What is a Lease Audit?
Lease Audit is Embraced by the Fortune 100.
Lease audit is a systematic process that examines leasehold expenses, billing methodologies, and lease language in commercial leases.
Professional lease audit is a very specialized forensic accounting function that requires expertise in building management, building operating systems, landlord billing structures, HVAC and energy audit, lease term interpretation / application, and is designed to level the field with the landlord and bring transparency to often highly complicated third-party billing / accounting systems.
Areas of a Review Typically Include:
- Annual Reconciliations / Operating Expenses / CAM Charges
- Base Year Calculations
- Escalation Indices: CPI, PPI, Porter’s Wage & other Index Driven
Escalators
- Gross Up Calculations
- Base Rent / Percentage Rent / Free Rent and Concession
Provisions
- Impermissible Lease Expenses / Capital Expenditure
- Pro Rata Share
- Insurance
- HVAC / Utilities
- Real Estate Tax / Specific Assessments and Parcels
- Overtime Charges and Tenant Specific Chargebacks
- All Other Chargebacks & Occupancy Related Costs
- Space Measurement Verification
- Sundry
