The monthly report produced by Commercial and Retail Property managers for landlords is a critical component of property control. The report itself allows the landlord to be fully briefed on complex property activity and gives them the ability to return with comments and instructions appropriate to the current issues within the managed concessions.
Monthly reports to landlords should incorporate fixed categories of activity together with the detailed dialogue and recommendations in each case. Here are some comments relating to the income activity in a managed property.
- The income for the property received during the month will be very high on the landlord's concerns and agenda. They will need to see that the income has been correctly charged and received. They will also want to see the status of any arrears. In a complex property with lots of tenants, the financial reporting system handling the income will need to be advanced and accurate in all respects. A good property management accounting system will do this.
- Any income and charges raised to the penalties should be documented and raised in separate income codes applicable to the charge. These codes are typically standardized in the software programs that you work with. This chart of accounts or codes allows you to easily compare the income and expenditure activity of the other properties to your property. It is interesting to note that some inexperience landlords and property managers even today still raise rental invoices manually; This is a dangerous practice because it allows for errors and poor record keeping of charges and payments. In a complex property with many tenants it is inherently impossible to charge and raise the income without an appropriate supporting software program.
- The income raised by the property manager should tally with any lease negotiations and the existing lease documentation for each tenant. Any adjustments in rental to be applied should be referenced in the leases and the charges raised. These adjustments should be displayed as rent reviews or other sundries charges detailed in clauses of the lease document.
- An arrears status report should be compiled in conjunction with the income performance report. Arrears when found should be responded to in a timely way to ensure that legally correct and timely recovery processes occur for all lease monies. In some cases the landlord may choose to reach an agreement respecting the recovery of any outstanding monies, and some payment plan may be put in place. That being the case, the monthly report should reflect the up to date position on any payment plans and progress with any defaulting tenant or those that are in arrears.
When it comes to the monthly property management report, accuracy in all respects is required. The property manager has to check the documentation to be sent to the landlord prior to its dispatch. There is nothing more embarrassing than receiving a telephone call a few days later from the property owner to say that the report is incorrect or monies have misused.