Where leases leak
Commercial leases carry dozens of date and formula obligations: rent steps, escalations, renewal and break options, and annual operating-cost reconciliations. Tracked by hand, a missed escalation date or an under-billed cost recovery becomes pure lost revenue.
Measure the gap
Economic occupancy, the rent actually collected against gross potential, set against physical occupancy, shows the leakage from concessions, arrears, and under-recovery. The recovery ratio quantifies costs you are absorbing that the lease lets you bill back, defensible only on consistent area data, the BOMA measurement standard.
Where the ERP closes the loop
On Hudace, leases, area schedules, and the ledger share one record, so escalations and cost reconciliations fire automatically against actual costs. Xenon AI reads lease documents for clauses and critical dates and surfaces under-recovered cost pools for an asset manager.
Every rebill and renewal stays a human decision. AI only narrows where to look.
The numbers to watch
The gap between physical and economic occupancy is the leak.
Economic occupancy
Collected rent / gross potential rent. The true revenue picture.
Recovery ratio
Recovered operating costs / recoverable costs. Below one is money absorbed.
Occupancy cost ratio
Total occupancy cost / revenue or area. The tenant-health and pricing signal.
Missed-escalation value
Rent steps not billed on time. Pure leakage, recoverable with alerts.
See lease leakage closed on Hudace
Talk to our team about firing escalations and recoveries automatically.