One of the biggest challenges that every large real estate or property management firm face is managing growth while keeping costs down. As the business expands, so is the challenges. An enterprise can only thrive once they learn to make what they have more efficient. Successful portfolio management can mitigate these challenges and elevate the company’s stature to the next level in the market. However, it isn’t as easy as it sounds.
A firm in the real estate business has to spend considerable time, labor, and money to stay ahead with Lease Administration, as it plays a significant role in making informed decisions. And one of the critical challenges with lease administration is ensuring data accuracy – from dates, dollars, and other clauses.
Lease Audits help identify potential hazards
A lease auditing is an invaluable process to identify billing errors that might occur in residential and commercial real estate. It can be tricky, as it involves reviewing the CAM charges, base rent, Insurance, HVAC / utilities, real estate tax, tenant chargebacks, and occupancy-related costs.
Anything can go wrong with lease audits if not paid proper attention. It often leads to unnecessary high overhead costs. Any discrepancies in the lease bills might also hamper the relationship between the tenants and the landlords. The ramifications of these unfortunate outcomes can drain a firm’s potential and damage business operations and performance. It is one reason why many companies are turning to an experienced lease administration partner for professional audit services.
Why is it essential for businesses to utilize a lease audit partner?
If you take care of your lease audits, they will take good care of your business. But imagine having to handle several lease documents for multiple properties; it is going to severely interfere with your schedule. Partnering with an expert lease administration service provider can put you at ease. It unwraps a world of benefits for your business.
Here are the top three reasons why businesses outsource lease audits:
- Sustainable Portfolio Management: An expert lease administrator by your side increases your chances of better portfolio management. They can relieve the stress of lease document audits for your managed properties. An experienced lease auditing agency will apply the best practices and employ qualified experts adept with technology and industry norms to handle the lease audits. You will be able to stay abreast of deadlines and commitments and have more time to concentrate on other aspects of your business.
- Reduce Operational Costs: Partnering with an experienced lease audit agency can help you save money on a large scale. With a team of subject matter experts, they can perform critical audits such as verifying CAM charges (assuring that it is in line with the lease agreement and industry standards), identifying discrepancies in the landlord billings, and even aid in eliminating the risk of missing lease dates. When compared to the in-house operational costs, outsourcing costs are far fewer. Businesses can train their resources to perform the task, but the associated costs remain high and time-consuming. Notably, real estate firms could reduce 2-4% of their total spending in portfolio management by outsourcing lease audits. Companies can expect a higher rate of efficiency in the audits, which removes overpaying or losing money. This applies to both the landlords and tenants. With the help of an external partner, a company can save millions of dollars spent on its operations.
- Enable better decision-making capabilities: Opting for a lease audit partner helps with cost reduction and enhances decision-making. Landlords and Tenants can leverage their expertise and inputs to make informed real estate decisions to advance their position in the market; the benefits for all parties—landlord and tenants—are substantial.
In addition to the above dividends, lease audit agencies can offer a leasing company a window into their business practice, highlight potential risks, and offer ways to optimize spending.
Partnering with leading leasing administration service companies like PreludeSys can enhance the quality of your lease audits. PreludeSys harnesses the power of state-of-the-art technologies and best practices in the lease audit process to maintain the quality and accuracy of the audits and offer insights that help to build successful business strategies.