Client
Leading special interest magazine publisher that leased 93,000 square feet of office space in New York City
Audit Discovery
KBA reviewed the lease and analyzed all available charges since lease commencement in 2006. KBA discovered that in the middle of the lease term, the landlord modified an assumption used to determine the amount of electricity used by the tenant. The new assumption was not necessarily incorrect, but it was inconsistent with past practices. Because the tenant’s electric charges were structured over a base year, the change in assumption caused an abnormally large increase in the electricity component of operating expenses and a significant increase in the tenant’s liability.
Resolution
At the Company’s request, KBA spearheaded an audit resolution process, leading and participating in all conference calls and meetings. These actions ultimately led to a resolution, and through KBA’s efforts, the Company’s liability through the end of the lease term, 2010, was reduced by $48,000 per year.
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