Real Estate

Commercial Property Leasing Activity Report: Your Complete, Foolproof Guide

When you manage or lease a commercial, industrial, or retail building, you need to keep track of lease issues, not just for the owner, but for the tenant as well. The performance of an investment property is affected by rental and lease documentation in a number of ways; you normally don’t want a vacant property.

The property manager or property lease manager must keep things in check and on track with the property strategy, business plan, and lease mix.

To resolve the issue, it is best to run a Leasing Activity Reporting process and update it at least once a month. Within each month, the report becomes a mobile tool to support real estate investment for the owner. It is a document that tracks:

  • Current Leasing Activity
  • Forward Lease Changes
  • Vacation

What you’re typically looking to avoid here with the report is cash flow disruption or something that disrupts the function of the property outside of any plans you may have. Accuracy in the report is paramount as it is likely to be the primary document that keeps you on top of critical lease issues. If there is an error in the report, a critical date in a lease is likely to be missed, and that can be significant in the long-term role of ownership for the landlord.

The Leasing Activity Report is a forward-looking report that typically covers the next 12 months and everything that can happen with leases and licenses. Special attention should be paid to anchor tenants and tenure mix strategies that are already in place; these strategies are already active and should continue.

In a multi-tenant occupancy, the number of leases in the building can become daunting and diverse. When the lessor owns and operates multiple properties at the same time, the stability of the lease is also complex. The Leasing Activity Report keeps you up to date.

A leasing activity report must include the following aspects:

  1. A lease schedule of current leases, including expected or known upcoming changes, such as rent reviews by type and time, options for an additional term, and expiration dates.
  2. Status of any current negotiations with new and established tenants.
  3. Signed lease report (i.e., for existing tenant-occupant leases)
  4. Lease report filed for documents that are pending for any reason
  5. Proposals for new lease contracts pending decision by the lessor or lessee
  6. Vacancy report for soon to be or already vacant areas
  7. Marketing strategy and inspection feedback for currently vacant areas
  8. Prospects currently seeking property and status
  9. List of vacant areas in nearby competing properties
  10. Changes in tenure mix are recommended
  11. Rental schedule in the current surrounding market you compete with
  12. Overview of the types and levels of incentives that exist in the surrounding market
  13. Target Rents and Target Lease Terms
  14. Summary of recent leasing decisions made by the landlord in the last month that affect the property or any vacancies.

When you use these topics for your lease report, it’s clear to you that most things are covered and under control. In addition to the items above, it’s best to provide a timeline chart of current and forecast events to help track events before they happen.