There are numerous aspects to focus on when you're in the process of selecting a lease abstraction vendor, and evaluating a potential firm's experience ranks as one of the more important metrics.
If you are considering outsourcing your lease abstraction process, then it is because you already know the benefits of hiring a lease abstraction company to abstract your leases. These perks of outsourcing your lease abstraction include:
Offering you significant cost benefits
Ensuring you stay on top of your lease portfolio, no matter how short-staffed you are on the lease portfolio management front
Allowing you to benefit from the expertise and industry experience of your lease abstraction vendor
However, in order to actually enjoy these benefits, you should pick the right lease abstraction vendor. One of the many things to look at when considering a lease abstraction vendor is their experience. Generally, clients tend to look at the number of years the lease abstraction vendor has been in the business. While experience in terms of industry-years is certainly a major factor impacting lease abstraction vendor selection process, it shouldn’t be the only one. The element of experience has multiple aspects to it. When looking at your lease abstraction vendor’s experience, two other areas to consider are if they have specific experience in specific areas.
Serving both, landlord & tenant
Has your lease abstraction vendor worked with both tenants and landlords, or, is their experience largely focused on one of them? Leases are complex legal documents, and interpreting them from the perspective of either the lessor or lessee is a skill honed with time and experience. You need someone who understands complexities and nuances of your leases and will advocate for your side. A lease abstraction vendor who has experience working with tenants has a much deeper and keen insight on the key factors in a lease that impact tenants than someone who has been typically involved with both sides of a Landlord-Tenant negotiation. Such a specialized vendor will be able to bring their rich and diverse understanding and expertise into your lease abstraction project, driving maximum value for you.
Serving clients from your industry
Every lease is unique, and leases pertaining to each industry have their own nuances. When picking a lease abstraction vendor, you might want to consider someone who has experience working with clients in your industry. This is especially true in case of industry verticals like cell tower, healthcare, retail, etc., where there are a lot of industry-specific clauses and documents such as tower co-location agreements, HIPAA regulations impacting the lease liabilities, percentage rent and related audit rights.
Taking a second look at the experience criteria from these two additional angles that we discussed will help ensure you pick a lease abstraction vendor that is able to abstract the key elements of the lease that you actually. This will ultimately help you make better operational and strategic decisions accurately, consistently and fully.