Lease administration is an important component of a property’s tenant relations program. It would not be a stretch for tenants to lose confidence in the building management if their lease is mismanaged. The owner will also lose faith since there could be lost revenue due to inaccurate rent statements. The overall business relationships for all parties would be compromised and therefore, lease administration is crucial to the success of a building.

The tenant looks to the landlord to operate the property in a professional manner that will allow them to operate the business without unnecessary restrictions but still within certain guidelines as stipulated in the lease agreement. The lease defines specific obligations for both the tenant and the landlord which comprises the overall operations of the property including the timely payment of rent by the tenant, Additional services include the maintenance and upkeep of the building’s mechanical equipment, electrical and plumbing, janitorial services, landscaping and other services depending on the type of tenant (retail/office) and the design of the building.

There are certain tenant obligations reflected within the lease other than the payment of rent. Some examples include insurance requirements, space improvements, signage, operating hours of the property, etc. The lease also spells out any changes or extensions to the lease such as renewals or rights of first refusal.

Ultimately it is the property manager’s responsibility to control the operating expenses of the property and enforce the rights and obligations of the landlord and tenant. The manager will administer the lease in an effort to protect the landlord’s investment. Understanding and administering every tenant’s lease agreement from the operating expense pass-throughs to the janitorial and security service requirements is a fundamental task of building management.