Lease abstraction is an important process in real estate management, whether it is for commercial real estate firms, property managers, or companies with multiple offices. The abstracted versions of lease documents make it easy for property managers and companies to stay on top of important information contained in their commercial leases, such as rent amount, payment dates, expirations and terms, to name a few.
Understandably, lease abstraction is a time-intensive process and can rack up significant costs for organisations overseeing multiple properties. In line with productivity and efficiency goals, many companies prefer to outsource lease abstraction services to third-party vendors offshore in order to to focus on their core business. In fact, according to JLL’s Future of Work (2018) study, 42% of the 561 global real estate directors surveyed said they outsourced at least 50% of their lease administration services, while around 36% said they planned to outsource more of these services in the coming three years.
It isn’t surprising that they are considering this step. Outsourcing lease administration services, such as lease abstraction, particularly to lower cost countries, offers cost and productivity benefits. The top 4 benefits of outsourcing lease abstraction services include:
- High data accuracy – Lease transactions need to be tracked regularly to ensure that lease terms and conditions are being followed and take action where required, such as following up on a lease renewal notice. This means that data in lease abstracts need to have a high level of accuracy and transparency. Experienced lease analysts familiar with lease terminology and formats will be able to ensure robust and error-free abstracts, which as an added benefit, comply with the latest global accounting norms. Accuracy in lease abstracts is necessary as part of an overall efficient lease administration process.
- Quick turnaround – Offshore vendors have teams that specialize in lease abstraction services and support real estate companies with abstracts for many of the provisions found in lease documents. Trained professionals who focus only on lease abstraction can do the work quickly and can handle high volumes. This ensures rapid turnaround times for lease abstraction services.
- Time difference advantages – Many outsourcing companies are in Asia and Western companies can take advantage of the time difference to get their lease abstraction work done. They can send the work to their offshore vendors before they leave the office and have the lease abstracts ready by the time they get back in the next day.
- Cost savings – A dedicated in-house team for lease abstraction is expensive for real estate companies, given time spent in hiring and training new people on these tasks. Third party vendors will already have such a team in place who can quickly start delivering the required output. Real estate companies will thus save on the costs.
You’re in good hands when you choose Cenza’s lease abstraction services. Our dedicated team of highly experienced lease analysts has at least a 99% data accuracy rate on all lease documents.