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Centralization of Lease Administration Nets $390,000.

Centralization of Lease Administration Nets $390,000

Lease Administration
Client: Top five national university

Overview:
The client did not have a centralized lease administration function. Multiple administrative assistants throughout the University’s various schools were keeping track of the lease portfolio (including tracking critical dates) via an Excel spreadsheet. Prior to hiring MBG Consulting, the client had opted to buy and use a lease administration software package and had committed all financial resources to it.

Scope of Services:
MBG Consulting was able to leverage of technological agility to implement the client’s chosen software and maximize its functionality. All leases were abstracted and the database was organized to reflect the client’s unique internal structure, which allows reporting by school, geographic location, unique internal identifier, cost center, fund resource, etc. Rent payments were centralized, which generated improved reporting and enhanced portfolio management. We gradually expanded the relationship to include lease audits, property tax and insurance premiums review and contest, and the production of specialized executive management reporting (detailed 10K, capital assets, depreciation, etc.). We implemented a comprehensive lease audit process and became part of each new lease negotiation by providing detailed reviews of operating expense lease clause language. The rental payment process evolved from MBG Consulting submitting rental reports to the client and the client cutting the physical checks to our current process whereby we issue the physical checks or utilize Electronic Funds Transfers (EFT) to pay all rental liabilities to the landlords.

Results:
MBG Consulting has saved the client $390,000 to date by recovering funds from incorrect or duplicate payments, as well as from correcting annual pass through of Operating Expenses. The value we have delivered is further measured by streamlined processes and procedures that eliminate errors, enhance the predictability of reporting, and allow for proactive management of real estate assets. Our flexibility allowed us to use the client’s lease administration software and formulate an elegant approach to achieve maximum lease administration efficiency with already-existing technology, a great benefit to the client.


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