---
name: lease-abstract
description: >-
  Read executed leases and their amendments and produce a rent schedule of the terms that drive value, then flag every place the leases disagree with the rent roll you were given. Use when valuing, underwriting or acquiring income-producing property, or whenever a rent roll has to be trusted rather than accepted.
---

# Lease abstract

**A rent roll is somebody else's summary of the leases.** The income approach, the
underwriting and the offer all sit on top of it, and it is prepared by the party with the
most to gain from it reading well. This skill goes to the leases themselves, produces the
schedule from the documents, and reports every disagreement with the rent roll rather than
quietly adopting one side.

## Step 1: assemble each tenancy before you read anything

Group the files by tenant or suite. Within each group, put the documents in force order:
the original lease, then every amendment, assignment, estoppel, subordination agreement,
side letter and guaranty, in date order.

**The last executed document controls.** An amendment beats the base lease on anything it
touches and changes nothing it is silent about, so read forward through the chain and carry
the surviving term. **A first amendment that resets the rent does not reset the expiry
unless it says so.**

State the chain you used for each tenancy. If a document references an exhibit, an amendment
or a schedule you were not given, name it and treat everything that depends on it as
unresolved.

## Step 2: pull the fields, one row per tenancy

**Identity and term.** Tenant legal name, any trade name, suite or unit, rentable area and
the document it comes from, commencement date, rent commencement date where it differs,
expiry date.

**Rent.** Base rent at commencement, the full step schedule with the date of each step, and
the escalation mechanism, whether fixed percentage, fixed amount, index-linked, or fair
market with a floor. For index-linked rent, record the index, the base period, the cap and
the floor.

**Concessions.** Free rent or abatement with the exact months, tenant improvement
allowance, moving allowance, and any rent credit, together with whether any of it is
repayable on default.

**Expense structure.** Whether gross, modified gross, net or triple net. Base year or
expense stop, the tenant's pro rata share and how it is calculated, any cap on controlled
expenses, any exclusion, and the treatment of management fees, capital items and real
estate taxes.

**Options and rights.** Renewal options with the notice window, the number of terms and the
rent-setting method. Termination options with the notice and any fee. Expansion, right of
first refusal, right of first offer, contraction, and any co-tenancy or go-dark right.

**Everything else that moves value.** Percentage rent with the breakpoint, exclusive use,
permitted use, security deposit or letter of credit, guarantor and the scope of the
guaranty, assignment and subletting terms, landlord recapture, holdover rate, and any
landlord obligation with a cost attached.

**Quote the clause for anything a reader might dispute**, with its section number. A field
with no citation is an assertion.

## Step 3: rules that keep the abstract honest

**Never fill a gap in a lease from the rent roll.** If the lease does not state it, the
field is unknown, and the rent roll's figure is a claim to be checked rather than a source.
Reversing this is how an error in the rent roll becomes an error in the valuation while
looking like corroboration.

**An option is not exercised until it is exercised.** Record the option and its notice
window. Do not extend a term because the option exists, and flag any option whose notice
window has passed without a notice in the file.

**Distinguish rentable from usable area** and say which the rent is calculated on. A
load factor stated in one document and a measurement standard stated in another are two
facts, not one.

**Record dates as written and flag the ambiguous ones.** Leases commonly define
commencement by an event rather than a date. Say so rather than computing a date the
document does not contain.

## Step 4: reconcile against the rent roll, line by line

For each tenancy, compare your abstract against the rent roll supplied. Report every
difference with the lease citation, the rent roll figure, and the size of the gap. Check at
minimum the tenant name, area, current rent, expiry, next escalation date, expense
structure and security deposit.

**Report the direction of every difference**, because a rent roll that overstates income is
a different problem from one that understates it, and a pattern in one direction across
several tenancies is the finding rather than any single row.

Also reconcile the total. Rent rolls foot incorrectly more often than any single line is
wrong.

## Step 5: what to hand back

1. **The schedule**, one row per tenancy, every field cited.
2. **Exceptions**, being every disagreement with the rent roll, worst first.
3. **Unresolved**, being every field you could not settle and the document that would
   settle it.
4. **Documents referenced but not supplied**, from Step 1.
5. **The rollover profile**, meaning expiries by year with the rent at risk in each,
   because that is the first thing anyone asks the schedule for.

## What this skill will not do

**It does not interpret a disputed clause.** Where a term is genuinely ambiguous, quote it,
say what the readings are, and leave the choice to the professional. **Never pick the
reading that makes the schedule tidier.**

**It does not value anything.** It produces the input, not the conclusion.

**It does not assume the file is complete.** An abstract built on a partial chain of
amendments is confidently wrong, which is why Step 1 comes before the fields and why
missing documents are reported rather than worked around.