Mall leases billed exactly as signed
Mall leases bill turnover rent in tiers from daily sales data, checked against the guaranteed minimum rent.
LiveWhat does Turnover rent engine (Pact retail) do? Landlords stop under-billing complex leases in spreadsheets, and tenants get statements they can check line by line.
How it works
Store sales arrive daily, from a connected till system or entered by hand. Kinnow calculates turnover rent in tiers, like tax slabs, and shows the working. It then compares the result with the guaranteed minimum rent and says which one applied. Increases linked to inflation follow a published index, with a cap and a floor; if the index figure is missing, the increase does not go ahead. Utility bills are based on the difference between meter readings.
Each day's sales are checked: net must equal gross less tax. Days that fail are named, so a total that balances cannot hide one bad day.
Step by step
- Set up the lease. The lease carries the guaranteed minimum rent, the turnover bands, any yearly escalation and the shops it covers. Bands are edited as one list. A ladder with a gap, or with bands that overlap, is refused when you save, because a gap would exempt part of the turnover and an overlap would charge it twice.
- Daily sales arrive from each shop. Takings come from a connected till system, or someone enters a day by hand. Each shop and day has gross sales, discount, tax and returns. Net sales are worked out as gross less tax. Recording a day that already exists replaces it.
- Kinnow checks every day. A day whose net does not follow from its own gross and tax is named on screen. A month that adds up cannot hide one bad day.
- The turnover rent is worked out in bands. Each band's rate applies only to the slice of turnover inside it, the way a tax slab works. Kinnow shows the working for each band and the blended rate the shop is really paying.
- It compares with the guaranteed minimum rent. The shop pays the higher of the two. Kinnow states which one applied.
- Index-linked increases follow a published figure. When an escalation is due it appears on the Escalations due list. It reads the index value you have published, with the cap and floor in the lease. If that month's figure is missing, the increase is not applied.
See a banded mall lease billed on a month of your own daily sales.
What you see on screen
These are the screens under Leases & contracts (Pact), for property and leases.
| Screen or button | What it shows or does |
|---|---|
| Leases, Turnover bands tab | The ladder of bands for one lease, edited as a list. A bad ladder is refused with a reason. |
| Daily shop sales | Pick a lease to see what the till reported each day: Date, Gross, Discount, Tax, Net, Receipts and Returns. Days that do not add up are listed. A Record a day button takes one shop and one day. |
| POS reconciliation and Percentage rent | On the lease: the per-band working, the blended effective rate, the minimum rent, and whether percentage rent applies. |
| Meters | Record a meter reading. The charge is the difference from the last reading, and the first reading only sets the baseline. |
| Escalations due | A list across all leases of rent increases that are due and not yet applied, soonest first. Click a row to apply it from the lease's Terms tab. |
| Index series | Published index values by index, period, value and source. An index-linked increase cannot be applied until the index it reads has a published value. |
| Ancillary revenue | The mall's own income such as parking and signage, kept apart from shop turnover so that the mall does not pay itself a share of its own car park. |
Who uses it
| Who | When |
|---|---|
| Property accountant | At month-end, checking daily sales and raising the rent invoices. |
| Leasing manager | When setting up a lease, and before a renewal, to see the blended rate. |
| Mall operations head | Looking at the Escalations due list each month. |
| Tenant's finance team | Receives a statement they can check line by line against their own till figures. |
Related
- Pact: leases and property: the application these leases live in.
- Real estate: how a property business runs on Kinnow.
- CAM charges: common area maintenance in plain words.
- Tenant sales reconciliation agent: checking reported sales.
- Lease renewal agent: preparing renewals.
Questions
What is Turnover rent engine (Pact retail) in Kinnow?
Mall leases bill turnover rent in tiers from daily sales data, checked against the guaranteed minimum rent.
What changes for the business?
Landlords stop under-billing complex leases in spreadsheets, and tenants get statements they can check line by line.
Is it available today?
Yes, it is live.
What does a banded turnover rent look like?
Example with round numbers: 6 per cent on the first one crore, 8 per cent on the next two crore, 10 per cent above that. On a turnover of five crore, each rate applies only to its own slice. Charging the top rate on the whole amount would over-bill by about 19 per cent.
What if a shop's daily figures do not add up?
Kinnow names the days where net sales do not follow from gross less tax. The month total still shows, but those days are flagged so they can be fixed before rent is billed.
What happens if the inflation index is not published yet?
The increase is not applied. Someone publishes the index value for that period, and then it can be applied from the Escalations due list.
Is the mall's parking income counted in shop turnover?
No. Parking, signage and kiosk income go on their own register, so the mall does not pay itself a share of its own takings.
Send us one lease and a month of daily sales and we will show the bill with its working.
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