What are the consequences of mismanaged leases? Well, the answer is a lot of time waste and impact on the bottom line. If you wish to align your company with a better lease management process, you will need to explore why the mistakes are being made in the first place.
Let’s take a look at 5 common lease management mistakes that hold companies back and give you an idea about bad lease administration.
Not Up to Date with Critical Lease Dates
As your company grows, so would your lease portfolio. It becomes very difficult to manually keep track of all the critical lease dates to avert payment penalties. The average length of the lease fluctuates globally, hence if the lease is not terminated within the timeframe specified in the contract, it could lead to unintentional renewal and a huge fee for breaking the renewed lease.
This is where the CRE Lease Matrix software can enter the picture. This lease management platform offers reminders and notifications for critical lease dates. In this way, you will not miss out on deadlines.
Delayed & Incorrect Payments
It should be simple to manage lease payments but can become progressively tough as your portfolio increases. You need to abide by the strict payment due dates for real estate taxes, CAM charges and property insurance fees. It is non-negotiable. If the payments are delayed and not correct, the company will get the tag of being unprofessional. Moreover, this move will prove to be costly as well as affect the relationship between the tenant and the landlord.
Poor Data Management
Companies require a comprehensive and all-encompassing view of all lease-related data, which can become a struggle to maintain as your firm expands. When your data is not well integrated, updates that are not uniform across teams and inconsistencies between documents are common issues afflicting the companies that depend on paper filing systems or an array of spreadsheets and documents to store their information.
Bad & poor data management can also lead to too many unintentional leasing delays which escalate the need for expensive tenant inducements or better tenant improvement allowances to draw new tenants. A robust lease administration platform such as CRE Lease Matrix has a centralized data management system that can prove to be essential for forecasting and budgeting as well as streamlining your lease portfolio.
Neglecting to Asses Building Operating Expenditures
It is essential to evaluate your business operating costs as it is vital to comprehend the cash flow connected to every property. This process is not given due importance when firms relax their lease management practices. Overbilling by landlords, missed reimbursements, inaccurate CAM charges, building repair expenses, tax errors and so forth are common financial mistakes that can quickly pile up, thereby affecting the bottom line.
Missing or Incomplete Lease Documentation
Losing documents or not filling out the complete paperwork is one of the mistakes that can be prevented more easily and yet it is more common than others. It is vital to keep lease contracts, eviction notices, as well as move-in or move-out forms on file. With a lease management system such as CRE Lease Matrix, you can store these important lease documents in a centralized platform where it would be easy to access to retrieve.
To sum up, these are the 5 common lease management mistakes that should be avoided. CRE Lease Matrix can help you avoid these errors. This is why it is one of the top leasing solutions for businesses across sectors in India.
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