Understanding Lease Abstracts- Real Estate Abstract

  • January 27, 2022
  • admin@ohi

What is a Lease Abstract?

Lease abstract is a commonly used word in the real estate world. You must have heard of the term several times but in case you don’t know what is a lease abstract, we are here to help. 

In the commercial world, a real estate lease is amongst the most important documents. Although not everyone is equipped to understand the legal terminologies, this further necessitates the use of lease abstract. It is a precise summary of crucial information from an extensive lease document. It allows you to review the key points easily.

The lease abstract is a concise version of the original lease document. It also tells you where to look for detailed information. And most lease abstraction documents are between one to five pages long. Thus, allowing you to quickly access the data.

We are sure that by now you have a basic understanding of what is a lease abstract. 

What should be included in a Real Estate Lease Abstract?

A lease abstract is an important document and it will only be helpful if prepared correctly. A lot of people who attempt making it are not aware of how to do a lease abstract. Preparing a lease abstract without knowing the right way of doing it can not only make the preparation process tedious but you might also end up with an inefficient abstract. 

Leases are extremely detailed documents with a plethora of legal terms and conditions. A lease abstract process or a real estate abstract contains only the important information. However, different information may be important for different stakeholders. While the breakdown of costs and the cost of periodic repairs may be essential for the tenant, key rights, such as the right of expansion or subleasing, would be important for the lender. Thus, it should be emphasized that one lease abstract cannot be used by different stakeholders.

Lease abstracts are extremely personalizable and should be prepared with care and by a professional. Some professional lease abstraction services also provide “abstraction insurance”. This will protect you in case any point is missed while drafting the abstract.

However, a typical real estate abstract contains a breakdown of costs, including operating costs and maintenance costs, rent, and the costs of repairs. The real estate abstract also clearly states the terms, such as renewal options and deadlines. Security deposit details are also mentioned in the abstract.

Knowing how to do a lease abstract can be a game changer because the person preparing it knows how to make a proper and personalized lease abstract for your firm, keeping in mind your firm’s needs, that will benefit your organization.

What are the Benefits of a Real Estate Abstract?

Lease abstraction has the following fundamental benefits

1. Highlights Issues

Lease abstracts highlight the issues that may need to be discussed while settling or once the ownership has been established. It summarizes all the information, making it easier for the reader to identify the issues.

2. Risk Mitigation

Complying with all the guidelines of a lease is essential to ensure no mistakes, that could cost money or the loss of property, are made. Lease abstracts ensure that owners and tenants do not miss the critical dates that can effectively impact the bottom line.

3. Cost Savings

Lease abstraction, when combined with reminder software solutions, will help you remember the essential dates. Thus, ensuring that you skip the hassle of late fees, interest, rent, taxes, and maintenance costs.

4. Allows for Strategic Use of Data

Lease abstracts provide useful information to organizations that can be used when they review their portfolio and its performance. This can also be used to make strategic decisions about acquisitions and to evaluate if the portfolio is adequately diversified.

Don’t know how to make a lease abstraction? Do not worry

There are many businesses and business owners who need a lease abstraction but don’t know how to make one. If you are one of them, you need not worry. Technology, like always, is at your rescue. 

You can easily hire lease abstraction services. These services are offered by professionals who are trained for the job. All you need to do is communicate your business’s needs to them and provide them with the information they need. 

Several commercial real estate lease abstraction services are available in the market today and you can easily hire them to prepare a lease abstract for you. 

These commercial real estate lease abstraction service providers especially deal with real estate business owners. They understand the needs of real estate investors or property dealers and work accordingly. 

Lease abstraction services can be easily availed of for a minimal cost. You should not think twice before availing of this service because its benefits are much larger than the cost you are required to pay for them.

Lease Abstract Software

Alternatively, you can also use lease abstraction software. Technology is an important part of our lives now and participates in almost our work. 

If for some reason, you do not like the idea of hiring people for the job, you can get a lease abstraction software installed. The software does all that a human will do and usually for much less cost. 

Software is easy to install and can be programmed to perform specific works for quite less money. It also has regular updates and significantly reduces the chances of human errors. 


Real Estate abstracts serve as a road-map for understanding leases. They not only simplify the entire lease, but they also summarize it, ensuring everyone can access it. The contents of leases vary as they are prepared differently for different stakeholders. It is, therefore, essential to understand the importance of this document and get it prepared by a professional lease abstractor.


OHI is a thirteen-year-old real estate services company working with 50+ commercial and residential real estate developers, funds and property management companies across USA. Our deep expertise in real estate accounting, financial analysis, lease administration and asset management has helped clients cut associated costs by 40-50%. We currently provide these services to a portfolio of 75000 units across clients.

We invite you to experience leasing and accounting outsourcing through us.

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