CHALLENGE: The class B+ building was experiencing cashflow shortages in spite of a steady occupancy over 90%.
RESULTS: Foresite worked with the ownership in notifying the tenants of the amounts due, the reasons why, and collected the entire amount of overlooked income.
“It was discovered that there was more than $20,000 in uncollected revenue.”
The two-story office building had been managed by a large local firm for several years. Upon receiving the assignment, Foresite’s property management team evaluated the historical income statement and prepared an operating budget. The class B+ building was experiencing cashflow shortages in spite of a steady occupancy over 90%.
Foresite carefully reviewed each lease and amendment and compared it to the rent roll. The rent roll correctly showed all tenants responsible for rent and their proportionate share of operating expenses but the estimated operating expenses were lower than the actual operating expenses. The team then compared these findings to the amount billed and collected as stated in the prior year’s general ledger. It was discovered that there was more than $20,000 in uncollected revenue as a result of the miscalculation of the year-end reconciliations by the prior management company.
*Names of the centers have been changed to protect client confidentiality. Representative photos used.