WALE, passing rent against market rent, and reversion
Each property shows its weighted average lease expiry by rent and by area. It sets passing rent against market rent, and shows the reversion between them.
PLANSScale only
The problem it solves
- Lenders and buyers ask for WALE, and you work it out in a spreadsheet each time.
- You do not know whether a building is let above or below the market until a lease comes up for renewal.
- Market rents sit in valuers' reports, away from the leases.
How it works
- On each unit, enter the market rent and whether it is a month or a year.
- Open the property's Rent and Expiry tab.
- WALE by rent and WALE by area show the years left on its confirmed and running leases, weighted by rent and by area.
- Passing Rent a Year sums those leases' rents; Market Rent a Year sums the units' market rents.
- Reversion (%) shows how far market rent is above (plus) or below (minus) passing rent.
- The figures are worked out each time you open the property, so they follow every new lease and renewal.
Everything it does
WALE
- Years left from today to each lease's end, weighted by its rent a year (WALE by rent) or its units' area (WALE by area)
- A lease with no end date counts as 30 days left
- Leases already past their end count as 0
Rent picture
- Passing rent a year: the monthly rent of confirmed and running leases times 12
- Market rent a year: every unit's market rent, monthly ones times 12; common areas are left out
- Reversion (%): market rent less passing rent, as a share of passing rent
- Empty units' market rent is in the market figure, so vacancy raises the reversion
Who uses it
Asset managerReads WALE and reversion before valuations, refinancing and sales.
Leasing managerKeeps market rents up to date on the units.
Owner or directorCompares buildings by WALE and reversion.
Where you use it
- Web: the property form, Rent and Expiry tab
- Not in the apps
- Not a report across properties yet: open each property
What you control
Settings
- Market rent and Rent Per (a month or a year) on each unit
Questions
What does WALE by area mean?
The years left on leases weighted by the floor area each lease holds, so a large tenant counts more than a kiosk.Why is reversion so high on a half-empty building?
Market rent counts every unit, let or empty, while passing rent counts only let units. Read reversion together with occupancy.Where does market rent come from?
You enter it on each unit, for example from your valuer's report. It is not looked up from anywhere.Which plan has it?
Scale.Related features
REPORTS AND AIRent roll, occupancy and vacancy lossOne list of every unit with its tenant, lease dates, passing rent and asking rent. It also shows the rent you lose each month on empty units. The same data gives occupancy by property and unit type.REPORTS AND AINOI and yield per propertyWork out net operating income for each property over any dates: rent and charges billed, less repair bills. See the yield on the value you enter.COMMERCIALTenant categories and exclusivityGive each commercial lease a tenant category, such as pharmacy or food court, and the categories it was promised as exclusive. A new lease that would break a promise in the same property is refused when you confirm it.REPORTS AND AIAsking-rent and renewal-rent hintsEach day SmartMy Lease suggests a new asking rent for empty units priced away from the market. It also suggests a rent for leases ending in the next 90 days. You apply a hint with one click; nothing changes by itself.REPORTS AND AILease expiries, arrears ageing and collectionSee which leases end when and how much rent ends with them. See every unpaid lease bill by how late it is, and billed against collected each month.
See your buildings on it.
Tell us how many properties and units you have, whether you let your own or manage for owners, and how rent is paid today. We will set up your portfolio with you on SmartMy Lease.