Case Study 11 – Lease Review

Firm

A mid-size real estate firm in Miami, Florida. The company manages over $300 million of real estate, over 4500 apartments and have been appointed receivers on over 15 properties.

Needs

Client had recently acquired a portfolio of seven properties comprising of about 1000 units. Lease abstraction and entry of leases was done in-house. Due to the shortage of time and the rent roll due in the monthly cycle, the client wanted a proper review of the leases entered. OHI was mandated to ensure that everything entered in the software was in line with the lease agreement and to correct any discrepancy found during the review process.

Challenges
  • Transmission of leasing documents
  • Consistent and accurate review of leasing charges across multiple leases
  • Executing Corrections in Resident Card
Solution

OHI allocated 2 leasing and AR specialists to meet the requirement of the client. These were in-turn supervised by a Team Leader, who was also responsible for communication and coordination with the client. Special emphasis was laid on establishing clear quality control mechanisms and review checklists.

A thorough review of the entered leases was done by the team.

  • Transmission - A common drop box account was set-up for sharing the lease contacts
  • Quick and accurate review – In a short frame of time, the accountants managed to review the entire set of leases entered. Essential terms like Security Deposit Amounts, Rent Charges, Dates and other Lease Charges such as Utility Charges, Pet Rent, Late fee charges, Concession on Move-Ins were closely reviewed. A filed checklist was created for every reviewed lease to ensure consistency of the review process
  • Correcting data in Accounting Software – An excel spreadsheet was maintained for all the discrepancies found during the review. Post a final go-ahead from the client corrections were done in the accounting software
Results
  • About 1000 leases were reviewed and corrections in Yardi were completed within one month
  • Detailed Documentation of the review process for future reference. The manual now forms an important part while addressing any new leases
  • We now assist the client in providing complete accounting and management reporting services. Lease abstraction, property accounting services include coding of payables, running rents, booking receipts, reconciliations, general ledger maintenance and monthly closing and reporting of books