COVID-19 raises the risk that hard-hit retailers will enter landlord negotiations with faulty or incomplete information about their own stores, leases and co-tenants, warns  Peter Wilson, a Managing Director at A&G Real Estate Partners, in an Expert Analysis piece for Chain Store Age Online.

“Even in normal times, when retailers are faced with a cash crunch and a strict timeline for closing and restructuring their leases, a surprising number of them come to the table with incomplete information about their portfolios,” he writes. “In particular, they may be operating with inadequate information about anchor-store closings and co-tenancies in the portfolio; the current owners of particular shopping centers in which they lease space; and the status and accuracy of prevailing rent schedules and lease abstracts.”

In the April 21 blog post (“Updating Real Estate Docs Is More Important Than Ever”), the retail real estate consultant notes that the chaos wrought by COVID-19 makes it more likely that retailers will lose track of what’s happening in their fast-changing portfolios.

That could weaken their position as they’re forced to the table with landlords in coming weeks over issues such as lease obligations and rent reduction, says Wilson, who works with  healthy and distressed retail and restaurant chains on rationalizing their real estate portfolios.

Moreover, he cautions, “incomplete or even sloppy lease administration slows the entire process down—something that retailers will not be able to afford if we do end up in a V-shaped recovery that requires rapid adaptation.”

With so many anchors closing stores and filing for bankruptcy, it is more important than ever for retailers to know exactly what’s happening with each location within their portfolios and how this stands to affect other operators with co-tenancy provisions in their leases, Wilson advises.

In the piece, he urges retailers to redefine the lease-administration role into a much-more-critical part of their real estate operations, even though collapsing revenues could tempt them to furlough precisely those who are responsible for updating lease-accounting and property-history information.

In today’s chaotic retail real estate landscape, concludes Wilson, “the right response is to supplement and support lease administration and make sure this critical information is up-to-date and easily accessible.”