Whether you’re a commercial real estate tenant with 100 or 3,000 leases, chances are high that you’ll find yourself with closed units from time to time. If your lease allows subleasing the property, it can be a great way to recoup any monetary obligations through the terms of your lease. However, many people forget that proper management of subleases is just as important as managing your primary lease portfolio. Below are a few somewhat obvious, but commonly overlooked, subleasing management tips to keep in mind.
- Know the lease – You must know exactly what you’re allowed to bill your subtenant, paying special attention to details like allowable rent increases.
- Create an invoice template – It’s critically important that invoices include a summary of charges, due date, remittance instructions, and above all, it must be legible. The invoice also must provide a contact name and number should your subtenant have questions.
- Bill on time – As the landlord, it is your responsibility to let your tenants know when payments are due, as well as send bills and other statements in a timely manner.
- Backup your invoices – Whether you’re paying your landlord, the taxing authority or an association director, you must promptly send invoices and proof of payments to your subtenant. And don’t forget to include their payment instructions.
- Track the dates – Your subtenants need to know payment due dates and understand the penalties for late payments. If you aren’t tracking payment receipt dates, you could be missing out on the opportunity to collect late fees.
- Stay on top of industry trends – You may be aware of skyrocketing lease rates and the affect it’s having on expanding multi-unit chains, especially those in strip centers. By staying informed of industry trends, you can better spot opportunities and manage your portfolio.
While these tips may seem pretty straight forward, it’s easy to overlook the basics when you’re responsible for multiple units with different lease dates. If you’re a Property Works client, ask your relationship manager for information about managing subleases through our software platform.
About Property Works
Established in 1996, Property Works provides lease management services to multi-unit retail, restaurant and commercial operators with 30 to more than 1,000 locations. Utilizing its propitiatory software platform and/or full-service lease management capabilities, the Property Works team helps clients: track critical dates and deadlines; redeploy valuable resources; make data-driven decisions; and boost the bottom line. For more information or to schedule a demo, visit PropertyWorks.com or call 678.795.3830.