BOMI RPA cheat sheet

Bundle of rights: disposition, exclusion, possession, quiet enjoyment, control - ownership is a set of severable rights, not a single indivisible thing.

Deed validity requires four elements: competent grantor, identifiable grantee, words of conveyance, and delivery with intent to convey; recording protects priority, not validity.

Easement vs. license: an easement is an interest in land binding successors; a license is revocable permission and creates no interest.

Leasehold estates: estate for years terminates automatically at a fixed date with no notice; periodic tenancy renews automatically and requires notice to terminate.

Title evidence hierarchy: general warranty deed (widest covenants) > special warranty > bargain and sale > quitclaim (no covenants).

Adverse possession typically requires actual, open and notorious, exclusive, hostile, and continuous possession for a statutory period.

Rentable vs. usable area: load factor = rentable area ÷ usable area; a higher load factor increases the effective cost per usable square foot.

Property manager authority flows from the management agreement: scope of services, spending limits, leasing authority, and reporting cadence are contract terms, not assumed powers.

Asset management optimizes the owner's investment return over a hold period; property management executes day-to-day operations at the building level.

NOI = effective gross income − operating expenses; it excludes debt service, income taxes, depreciation, and capital expenditures.

Effective gross income = potential gross income − vacancy and collection loss + other income.

Operating expense ratio = operating expenses ÷ effective gross income; compare against submarket benchmarks of similar age and class.

Capital reserve funding is a budgeted non-operating item; unfunded reserves shift cost to future owners and depress resale value.

Operating budget variance: dollar variance = actual − budget; percent variance = dollar variance ÷ budget line; investigate variances beyond a stated threshold.

Preventive maintenance is scheduled by condition and warranty cycle; corrective maintenance is reactive; deferred maintenance raises risk and future capital need.

Hold/sell analysis weighs NOI trajectory, capex needs, cap rate movement, and debt terms rather than current occupancy alone.

HVAC load components: conduction through envelope, solar gain, internal gains from people, lighting, and equipment, plus ventilation load.

Chilled water loop: chiller → chilled water pump → air handling unit coil → return; condenser water loop rejects heat via cooling tower.

VAV systems vary air volume at constant supply temperature; fan energy drops with the cube of flow reduction, so part-load savings are substantial.

Elevator maintenance contracts differ: full-service covers parts and labor; oil-and-grease covers routine lubrication only, leaving repairs to the owner.

Fire protection: sprinkler systems require periodic inspection and testing per adopted code; impairment procedures and hot-work permits govern shutdowns.

Electrical service capacity is rated in amps and volts; available capacity constrains tenant fit-out and must be verified before leasing commitments.

Life-safety systems include detection, notification, suppression, and egress; each has separate inspection and testing intervals.

Building commissioning verifies systems perform per design intent at turnover; retro-commissioning applies the same process to existing buildings.

Cash basis recognizes transactions when cash moves; accrual basis recognizes revenue when earned and expenses when incurred, matching them to the period.

Straight-line rent recognition spreads total lease payments evenly over the lease term, even if cash rent escalates.

Cap rate = NOI ÷ value; value = NOI ÷ cap rate; a lower cap rate implies a higher price per dollar of income.

Cash-on-cash return = pre-tax cash flow ÷ equity invested; it measures leverage effect, not unlevered asset quality.

DSCR = NOI ÷ annual debt service; lenders commonly require a minimum coverage threshold before approving a loan.

Depreciation is a non-cash tax deduction; it reduces taxable income but does not reduce cash flow or NOI.

Escalation recovery: recoverable operating expenses × tenant pro rata share (tenant rentable area ÷ total rentable area), subject to base year or expense stop.

Gross-up adjustment in CAM reconciliations normalizes variable expenses to a stated occupancy level so tenants pay a fair share.

Lease types: gross (landlord pays expenses), net (tenant pays taxes, insurance, maintenance), and modified gross (split defined by the lease).

Base year stop: tenant pays its pro rata share of expenses above the base year amount; expense stop uses a fixed dollar figure instead.

Tenant improvement allowance is landlord capital; amortization of the allowance into rent converts a lump sum into a lease-term income stream.

Concessions such as free rent reduce effective rent; compare deals on effective rent per square foot over the full term, not face rate.

Lease term components: commencement date, rent commencement date, expiration, renewal options, and early termination rights may all differ.

Assignment transfers the entire remaining interest; sublease transfers only part of the term or premises and leaves the original tenant liable.

Percentage rent = (gross sales − breakpoint) × overage percentage; natural breakpoint = base rent ÷ overage percentage.

Recovery structure must match lease language: cap on controllable expenses, audit rights, and exclusions are negotiated clauses, not defaults.

Vacancy cost = lost rent + unrecovered operating expenses + leasing commissions + TI + downtime; leasing speed directly affects net effective rent.

Tenant retention economics: renewal typically avoids downtime and full TI, so renewal cost per year is usually lower than a new lease.

Space marketing requires accurate rentable area, load factor, and availability date; misstated area creates lease disputes at execution.

Tenant satisfaction drivers measurable by survey: response time to service requests, cleanliness, security, comfort, and communication.

Work order metrics: response time (receipt to dispatch) and resolution time (dispatch to completion) are tracked separately.

Tenant improvement project communication plan: milestone schedule, access notices, utility shutdown notices, and escalation contact.

Delinquency escalation sequence: reminder, formal notice per lease, then remedies permitted by lease and local law; self-help eviction is generally prohibited.

Lease abstract data - options, notice addresses, co-tenancy, exclusives - drives both marketing claims and enforcement.

Risk control hierarchy: avoid, reduce, transfer (insurance and contracts), and retain; retention is appropriate for low-severity, high-frequency exposures.

Certificate of insurance review checks named insured, additional insured status, limits, and notice of cancellation - a certificate is evidence, not coverage.

Indemnification and insurance are distinct: indemnity allocates liability; insurance funds it; the contract should make them consistent.

Fair housing law prohibits discrimination in sale, rental, and advertising based on protected classes defined by federal, state, and local law.

Environmental obligations include asbestos and lead-based paint disclosure, underground storage tank reporting, and mold/moisture response procedures.

OSHA obligations for building operations cover hazard communication, bloodborne pathogens, lockout/tagout, and recordkeeping of injuries.

ADA obligations split into removal of barriers in existing facilities (readily achievable) and design standards for new construction and alterations.

Incident documentation should record time, persons, conditions, and witnesses contemporaneously; documentation supports both claims defense and insurance recovery.