NetLease - Renewal Processing
Overview
With renewal options properly configured in NetLease, lease extensions can be processed seamlessly—either automatically after the final amortization entry is run, or manually with the click of a button.
Prerequisites
- Make sure the renewal options are set up correctly: Renewal Setup Guide.
Step-by-Step Process
The approach to handling renewals will vary depending on the Renewal Type.
Month to Month & Auto Renewals
Both Auto Renewal and Month to Month renewal types will follow a similar approach for processing, based on the configuration of the Automated Renewal setting in the NetLease System Setup.
Automatically Processed
If the Automated Renewal setting in the NetLease System Setup is configured to Automatically Process, renewals will be triggered and processed automatically once the amortization entry for the lease's final month is processed.
Step-by-Step Process
- For leases with either Month-to-Month or Auto Renewals, process the journal entry for the final month (see Run Monthly Journals):
- When the final amortization entry is generated, the system will detect the renewal and automatically trigger the process to modify the lease, extending it based on the specified renewal details:
- Once the process is complete, the renewal will display a status of Exercised on the Renewals subtab:
Pending Review
If the Automated Renewal setting in the NetLease System Setup is configured to Pending Review, auto-renewals will not be triggered automatically when the amortization entry for the lease’s final month is processed, providing an opportunity for a final review before manually processing the renewal.
Step-by-Step Process
- Process the journal entry for the final month (see Run Monthly Journals):
- Once the final entry is generated, the system will detect the renewal. However, instead of processing it automatically, the lease status will change to Pending Renewal, and a Renew button will appear on the lease record. This allows the user to either process the renewal or—if it's determined that the renewal is not needed—close out the lease:
- To process the renewal, simply click the Renew button.
- In the popup that appears, click the OK button:
- This will trigger the system to process the renewal to modify the lease, extending it based on the specified renewal details:
- Once the process is complete, the renewal will display a status of Exercised on the Renewals subtab:
Note that when the Automated Renewal setting in the system setup is set to Pending Review, both Month to Month and Auto Renewals can be processed in mass by navigating to NetLease > Mass Update Leases > Mass Exercise Renewal Options.
Right to Renew
The Right to Renew renewal type differs from the Auto-Renewal and Month to Month types in that it is not processed automatically. Instead, it serves a more informational role, acting as a record where available renewal details are stored. This information can then be used to manage renewal options and provide the necessary details to process a renewal, if needed.
Step-by-Step Process
- After processing the final amortization entry for a lease with Right to Renew options, go to NetLease > Mass Update Leases > Mass Exercise Renewal Options.
- On the following screen, apply any necessary filters, select the contract provisions to process, and then click the Exercise button:
- Refresh the page on the next screen as needed until the Status shows Complete:
- Navigate back to the lease record to view the results of the system processing the renewal, which modifies the lease by extending it based on the specified renewal details:
- The renewal will now display a status of Exercised on the Renewals subtab:
If a Right to Renew provision has expired or was not utilized, navigate to the Contract Provision record and manually update the Status from Available to either Exercised or Unavailable.