Understanding Lease Abstracts- Real Estate Abstract


What is a Real Estate Abstract?

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 real estate abstract or 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.

What should be Included in a Real Estate Abstract?

Leases are extremely detailed documents with a plethora of legal terms and conditions. A lease abstract 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.

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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.


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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