Yardi Breeze is refreshingly simple property management software for both residential and commercial properties. Since your commercial portfolio might include retail properties, we have tools for retail management too. Keep reading to learn how Yardi Breeze can help make managing retail spaces easier, including automatically calculating overage charges.
Managing retail properties
When you set up commercial properties in Yardi Breeze, all you have to do is check the Retail box to activate our retail setup tools. On the Retail Setup screen, you can set the formula for overage charges, including the frequency, breakpoints and percentages. Once you enter and save this information, it will appear on the lease screen for quick reference.
Calculating retail overages automatically
Charging retail overage rent, also known as “percentage rent” is characteristic of many retail leases. Percentage rent is an additional charge that’s calculated based on sales and added to the base rent charge.
Overage rent agreements can benefit both the landlord and the tenant. Because the landlord gets a financial boost if their tenant is successful, they are more likely to do things to encourage traffic, like maintain and market the property.
If you charge overage rent, the exact numbers should be specified in your lease agreement. You might have multiple breakpoints that indicate that a tenant will pay an overage of 7% if gross sales top a certain number or 10% if sales go above an even higher number. You can calculate these amounts monthly or annually. For more information, see this article about calculating breakpoints. In all cases, if your tenant doesn’t reach the first breakpoint, no charge is added.
If your retail property has overage amounts set up in Yardi Breeze, the software can calculate overage charges for you, saving you time and hassle. It can also prorate the breakpoint amounts to accommodate tenants who haven’t been in place for the full term. It automatically adds the calculation details to the notes field of the overage charge that’s created for the tenant.
Charging common area maintenance fees
If your retail tenants pay common area maintenance (CAM) fees, Yardi Breeze can help you with that too. You can track estimated and actual expenses for each tenant, and then automate CAM reconciliations at the end of the year, instantly creating charges or credits as needed.