Lease abstraction

Lease abstraction commercial property

Lease abstraction is the process of converting lease data from PDF or paper, into a more analysis-friendly format – as desired by a client.

The analysis friendly target format can be Excel or a database structure.

Lease abstraction interventions

  • Extraction of data from one format (PDF) into another (Excel)
  • Transformation of data – explained in more detail:
    • Business rules can be applied that make the information in the target format more decision-relevant (such as changing all fields with value A, B and C, to value Y)
    • Cleaning of data: standardising of values, lease renewal terms, correction of street addresses
    • Enrichment of data: adding of tenant industry classifications, assignment of co-ordinates to property locations, addition of company unique identifiers
  • Loading of data into a client-specified end environment

A lease abstract provides a condensed version of the original lease document, and is ideal for portfolio analysis, due diligence or valuation exercises.

Phases in a lease abstraction project

(Certain projects may require only one of the steps below)

  1. Project setup – confirm requirements, document business rules, map data fields, formalise outputs
  2. Data processing – actual abstraction and queries (if required)
  3. Final data migration – loading of data into target environment
  4. Reporting – communication of project wins, root cause solutions, and proposed next steps (if required)

What data is abstracted?

  • Lease financial information: space occupied by type, rentals paid, rent review / escalation terms, expenses payable, turnover clauses, tenant installation allowances etc.
  • Lease general information: lease type, lessor entity, lessee industry classification, contact parties, deposits, guarantees, suretyships etc.
  • Property specific data: property names, addresses, location data etc.
  • Time-relevant lease events: lease expiry dates, lease renewal deadlines etc.
  • Onerous clauses (risks / liabilities) for the occupier: reinstatement clauses, dilapidation clauses, maintenance obligations, redevelopment clauses etc.
  • Onerous clauses (risks / liabilities) for the landlord: business continuity obligations / compensation, termination clauses, pre-emptive purchase rights etc.

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