RealProperty PLUS Commercial I

Escalations and Passthroughs

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How to get there

• In the Commercial Mgmt group, in folder Expense Recovery

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Define expense pools

The first step to the expense recovery setup process is to define the pools of expenses on which the tenant’s share of expenses is based

There are 3 types of expense pools:• Accounts – the user defines G/L accounts that may be

automatically updated when the user is ready to begin the billing process.

• Fixed Amount – fixed for every month• Statistical Category – the statistical categories that are

used in the budgeting process...percent increases etc.

Expense pools may be defined as either Automatically updated, or Manually updated.

• Automatic - The user defines a time period for which the system should update the pool based upon the type.

• Manual – The user may enter the values manually.

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Maintain expense pools - manually

Expense pools are comprised of the total monthly Actual and/or Budgeted expenses for the year.

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Maintain expense pools - Automatically• Define the range of periods to be updated

from the General Ledger

• The system reads the general ledger for the selected time period for the accounts defined in the expense pool, and imports the monthly expenses for the property.

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Maintain monthly square feet

• Because the square feet available for rent/use etc. can vary, the user may maintain property level monthly total square feet values to be used when the project square feet is based upon average leased.

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Tenant expense recovery definitions

• There are 4 categories of expenses– Common area expenses– Property taxes– Real estate taxes– Porter wages

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Define tenant expenses

This defines the duration of the pass-through expense definition

If this tenant is an anchor tenant, then this determines the order when calculating the expenses for other tenants

This may be defined differently for each expense pool.

Theses may be defined differently for each expense pool.

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Define tenant expenses – page 2This section may be also be defined for each expense pool.

A single charge is created as an open batch transaction.

A monthly recurring charge is created according to the billing frequency

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Assign pools

• At least one expense pool must be assigned, but multiple pools may be assigned if a single invoice with multiple types of expenses is desired.

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Assign expense poolsIf there are anchor tenants in the property, this determines whether or not the expenses for the property will be reduced by the anchor tenant's expenses before calculating the tenant's pro-rata share.

Calculated after all pro-rata calculations have been done.

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Billing tenants

For a new billing, identify the calculation month/year and the type of billing.

The only time the values from the tenant lease definition are used (including the pool definition rules) is when a new billing is created.

When working with an existing billing, the values stored in the work file from the previous create new billing, or work with billing session are used

If you wish to insure that the work file reflects the current state of the tenant pass through/CPI definitions, then you must clear the billing file first.

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Define criteria for new billing

If the property has anchor tenant's, and any tenant's have “reduce by anchor” checked, then the sequence should be “Anchor Level”

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Select expense definition to work with

This screen shows each tenant and its associated expense definitions. Which status types are displayed is determined by the filter options on the previous selection screen.

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Display and calculate expenses

All of the information on this screen comes from the tenant expense setup screen.

This tab provides a detail view of the tenants calculated pro-rata share of expenses.

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Line item detail

This worksheet shows what will be printed on the actual invoice, and allows the user to override the tenant share if necessary.

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Print the billing

If you have free-form financial formats defined, you may specify that they be used for printing the supporting detail for the expense pools.

You may specify to print a copy of all invoices or other documents to be attached to the bill.

The report is a crystal report that you may modify as needed adding logos, or reorganizing the invoice.

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A sample billing

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Posting

• What happens when you post escalations/pass-thru expenses?

– If the type is• Year-End adjustment, then the Total Due is

posted as an open batch transaction• Monthly Estimate, then the total due is

split into as many payments as there are months checked in the Billing Frequency.

– The Next Anniversary date is updated with the next month that is checked in the Calculation Frequency.

– The Last Calculation date and Lease Month/Year is updated with the Month/Year that was posted.

– The work file header and details are removed.

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Questions

We are open to your suggestions as to how the escalations/pass-through system may be improved to better meet your needs!