What to gather before a lease audit

4 min read

A lease audit compares what the lease says with what the landlord billed. The comparison only works if the paperwork is complete. Most delays come from missing amendments and scattered payment records, not from the review itself. This article lists what to pull together before a partner firm contacts you, so the first conversation can be about findings instead of file hunting.

You can send a request through Request a professional before your file is perfect. A partner firm will tell you what else it needs. Still, the more you have ready, the faster the work can start.

Start with the lease itself

Find the signed original and every change made to it since. Leases are rarely the single document people remember. They grow through amendments, addenda, renewal notices and side agreements.

Check each of the following:

  • The signed lease with all exhibits and schedules
  • Every amendment and addendum, in date order
  • The commencement memo or any letter fixing the start date
  • Renewal and option notices you sent or received
  • Guarantees, if any
  • Estoppel certificates, where they were issued (see estoppel certificate)

Missing pages matter. A source on lease record keeping notes that absent documents can lead to wrong rent calculations and missed option dates, which is why a partner firm will ask for gaps to be listed rather than ignored.

Collect the billing side

The lease tells you what should happen. The billing records show what did happen. Assemble these for each location:

  • Rent invoices or statements for the period under review
  • Payment history showing amounts, dates and method
  • Annual operating expense and CAM reconciliation statements, with any backup the landlord supplied
  • Monthly estimate notices that set your advance payments
  • Letters from the landlord about additional charges or rent changes
  • Records of any true-up payments or credits

If your accounting system splits one landlord across several accounts, export them together. A partner firm needs one continuous view, not four partial ones.

Write down what you already suspect

Your team often knows where the problems are. Ask the property manager, the facilities lead and accounts payable for a short list of issues they have already spotted. Examples include a charge that appeared without explanation, a square footage figure that changed, or a rent step that seemed to arrive early.

Keep the list plain. For each item, note the location, the approximate date and who raised it. This saves the partner firm from rediscovering what you already know.

Pull key terms into one place

You do not need to produce a full abstract, because a partner firm can build one. A rough summary still helps you spot gaps before anyone else does. For each lease, note:

  • The term and the dates of any options
  • How rent changes over time (see escalation clause)
  • How operating costs are shared and whether any caps apply
  • Who is responsible for repairs, taxes and insurance
  • Notice requirements for disputes or audit rights

If you want to know what a finished summary looks like, read about a lease abstract.

Note: Audit rights in a lease often carry a time limit and notice rules. [VERIFY: check the audit and dispute clauses in each lease with counsel before relying on any deadline]

Gather contacts

List the people a partner firm may need to reach:

  • The internal owner of the lease
  • The person who approves and pays landlord invoices
  • The landlord or property manager contact
  • Anyone who negotiated the lease or its amendments

The review is run by the partner firm, but you stay involved. You will be asked to confirm data and to review findings. The steps are described on How it works.

A short checklist before you submit

  1. Confirm you have the full signed lease and every amendment.
  2. Export payment history for each landlord account.
  3. Locate the last several operating expense reconciliations.
  4. Write your list of known issues.
  5. Name an internal contact and a backup.
  6. Choose the right request path for your business size.

Where this fits

This checklist supports the work described on Lease audit and compliance. Fairview connects you with a partner firm. The firm does the review, and any fees or terms are agreed between you and the firm. [CONFIRM: a partner firm supplies and approves this statement about its typical process]

Sources

Find out what you are overpaying.

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