Creating and Administering Leases

The following is a high-level overview of the steps involved in creating and administering a lease:

• (Optional) Create a lease abstract for a lease.

  Before you create a new lease, you must extract the terms and conditions of that lease to be captured and administered in the system. A lease abstract provides a work template and/or summarization of those terms and conditions, thus streamlining lease entry.

• Create a lease in PeopleSoft Lease Administration.

  Each lease you add, whether it is a payables or receivables lease, enables you to define the timetable of the lease commencement and termination date along with the term of the lease. Each lease can include one or multiple properties. You also can designate the administrator, portfolio manager and other operational information such as region.

• Capture base rent, operating expenses and other financial terms for a lease.

  As a lease administrator, you define the base rent and operating expenses for a lease. Operating expenses can be defined for shared maintenance costs. These costs are for the common area maintenance of the property such as: landscaping, cleaning, lobby staff, and so on, and these operating expense categories can be predefined in setup.

  Once you have defined theses terms, PeopleSoft Billing can generate an invoice or a payment can be made through PeopleSoft Payables, depending on the lease type.

• Define rent escalations for a lease.

  You can associate a financial index or assign a periodic stepped increase for escalation of rents in a lease.

• Setup periodic billing and payments according to lease terms.

  Recurring monthly rent can be setup for periodic billing according to lease terms. The information is sent to PeopleSoft Billing or PeopleSoft Payables on a periodic basis, simplifying the administration of that lease.

• Define percent rent terms.

  You can establish leases with variable rent payments based on reported periodic sales. Lower rent payments can be negotiated in exchange for a portion of sales. As sales reach specified thresholds (breakpoints) the percentages change, thus altering the final rent amount. You can predefine these sales categories in setup.

• Select clause types and clause subtypes to be associated to the lease.

  You can predefine clause types and clause subtypes to associate to a lease. Leases can have multiple clauses defining the terms of conditions of that lease.

• Define options and critical dates in a lease.

  Leases can have many events, options and key milestones dates that may be of significant importance and might require reminders of actions that need to be taken. The options and critical dates feature acts as a early warning of when these dates become due so you can take the appropriate action. Additionally, templates can be setup to expedite entry and enforce consistency in notification rules.

• Manage notes and contacts.

  Enter notes to serve as a contact history of the lease, with optional attachments, if desired. From the defined Landlord or Tenant in the general information, customer or supplier contact information can be accessed from the customer or supplier master and referenced on the lease. You can also set up either internal or external lease administration contacts specific to that lease.

• Manage lease changes through amendment processing.

  Amendment processing enables you to make changes to an active lease while keeping a historical record of the original lease and any prior amendments to that lease.

See Understanding Leases.