EPISODE 6: The Lease Police | Phyliss Pruden

Phyliss Pruden is a former police officer who has led lease administration and lease accounting teams at some of the biggest companies in the world. Find out how law enforcement relates to lease management and hear Phyliss’ tips for success.

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Transcript

SPEAKER_00 0:06

Phyllis Curtain is a former police officer who has led least administration and least accounting teams at some of the biggest companies in the world. Find out how law enforcement relates to least management, and here are Phyllis's tips for success.

SPEAKER_02 0:20

Least administration and least accounting, I mean they just go hand in hand. In a post-842 world, you have to have knowledge of both to be effective.

SPEAKER_00 0:30

Welcome to New Least On, where we talk about the latest in least accounting and least administration and share stories of changes in perspective and new beginnings. I'm your host, Matt Waters. Let's dive in. Phyllis, welcome to New Lease On.

SPEAKER_02 0:53

Thank you, Matt. Thank you for inviting me on. It's great to be here.

SPEAKER_00 0:57

Glad to have you as always. And let's just dive right in. Tell us about what you were doing towards the end of last year and then about the big move that you've made.

SPEAKER_02 1:07

I have, I made a big move. So I was the Global Lease Administration, senior manager for lease accounting and lease administration at Oracle. So, and as we know we talked about that previously, it spanned 96 countries and as many languages and currencies. And I decided to just sit back and say, what does the next chapter look like? And I was fortunate to have an opportunity come to me from Kenco, which is the logistics company, a 3PL company. And it really allowed me to step into a more strategic role where I can apply the same experience that I have, what but while I'm learning a new industry and gaining a little better balance. I'm still very focused on, you know, delivering in my role, but I'm not working the same level of extended hours I had before. And that's allowing me to be more intentional with my time and really decide where to focus my time. So I look at it as more strategic and I'm not really stepping away from leadership. What it's allowed me to do is I can expand from operational leadership to like a broader impact. I can focus more on mentoring, I can invest more time with NRTA, I can share knowledge, hopefully, with the next generation of lease administrators. And it's really given me an incredible value, and that's the ability to grow in a new industry while giving back to the profession that essentially helped build my career.

SPEAKER_00 2:29

Yeah. Oh, wow. I love it. You know, it's funny. I actually on the day of this recording, earlier today, I was leading a class, brand new class of people taking the CGLA program, this certified global lease accountant program. And I brought your name up because I think you really have demonstrated how somebody can have a successful career specializing in lease administration and lease accounting. And the students that I was talking to this morning, they happen to be coming into the lease accounting opportunity by way of lease administration, right? Which is which is kind of what you did and and and so many others. And so I just think it's so encouraging to hear you say that that this profession, lease administration, lease accounting provided so many opportunities. And it wasn't just at one company, right? These skills are transferable. And really any big company is going to need somebody with that skill set.

SPEAKER_02 3:27

I mean, they just go hand in hand. In a post-842 world, you have to have knowledge of both to be effective in the position, whether you're, you know, primarily focused on the lease accounting side or you're primarily focused on the lease administration side. They work together. And I often find that companies that silo those, they have significantly more issues because they're siloed and there's that lack of communication. So if you're going to have them in separate groups, there needs to be an open channel of communication between those two groups.

SPEAKER_00 3:57

Absolutely. I couldn't agree more. So tell me about now. I know uh when you work at Oracle, because I've talked with people that you used to lead and work with, I know you mentored people in that role. But now do you have even more opportunity to mentor people and help in your new role?

SPEAKER_02 4:16

I do outside of my new role. My new role is very strategic.

SPEAKER_01 4:20

Yeah.

SPEAKER_02 4:20

There, and it's focused on more on processes, occupancy costs, you know, and working with a company to bridge that gap between the accounting department, the lease administration department, and build a, you know, a more robust lease administration program. And so it's like I said, it's more strategic rather than like the operational leadership. But what that's allowed me to do is to dedicate more time to NRTA, you know, outside of my working hours. So I'm I'm working on that. I started a blog because I thought that would be kind of fun. Oh, cool. Yeah. There's a lot of conversations out there. And sometimes you have questions like, what would you do in this situation? Because every day, you know, something new comes up. I see you learn something new every day in least administration. And so I feel like having a community where you could go and share information or ask information in the comments, or ask up a LinkedIn group, or go to this group and ask questions. I think a lot of information you're gonna learn, you're gonna learn from the lease administration community.

SPEAKER_00 5:19

Yeah, for sure. So what's the name of your blog? The Lease Police. Oh, awesome. Yeah. Yes. I love it. That's great. Yeah, yeah. I mentioned up front, you started out as a police officer. So I imagine that inspired part of that, right?

SPEAKER_02 5:34

It definitely inspired it because there's so many things that translate between the two jobs that you wouldn't think of. You wouldn't say, oh, working in lease administration requires some of the same skill sets that working in law enforcement does. But when you break it down, there are very similar skill sets. In law enforcement, your work is based on evidence, you know, your work is based on critical thinking, you know, figuring out difficult situations. And then you have to take all of that information and write a report. And that report is used by the courts, it's used by attorneys, both on the civil and the criminal side. And conflict resolution, you know, you may have to, you know, de-escalate situations, you know, it's very similar on the real estate side. You use critical thinking, you're reading legal contracts, you have to understand legalese. When you have disputes or audit issues, you have to put all of that into a report that auditors rely on that potentially attorneys could rely on. You know, you have to diffuse difficult situations with landlords or maybe tenants in a you know, a subtenant situation. And I kind of equate lease administration to the similar concept of crime prevention. You're often measured by what doesn't happen. So in law enforcement, you know, crime prevention is very difficult to measure because you're measuring what didn't happen as you're out there. So, you know, preventing crime. Well, if you're a really solid good lease administration team, it's the same concept. It's the error that never made it to the balance sheet. It's, you know, the occupancy cost that you found during the audit, it's all the things that you find when you're being proactive. So I say it's very similar in measuring the things that do not happen.

SPEAKER_00 7:05

Yeah, so true. Yeah, it can be the same, I think, in that sense that you're always just looking for the facts, right? And law enforcement, or if you're a detective, for example, or as a lease administrator or a lease auditor, you got to stick with the facts. What does the lease say? And always go back to that. And then, you know, by extension, I guess a database of well-abstracted lease information is vital, right?

unknown 7:34

Right.

SPEAKER_00 7:35

You have to have your facts straight and you have to have them organized in a way that you can actually get to them, right?

SPEAKER_02 7:40

Right. Right. And that they're helpful to somebody else. Someone else is going to rely on the work that you do.

SPEAKER_00 7:45

Yeah.

SPEAKER_02 7:46

Yeah.

SPEAKER_00 7:47

So you mentioned NRTA, and and that's for anybody who's not aware, that's the National Real Estate Tenants Association. And the annual conference is coming up in Arizona later this year. It's in the fall. Phyllis and I will both be there. Matter of fact, we'll be speaking together uh in one session, and there'll even be a 5k fun run or walk for anybody that's interested in that. Bring your running shoes for that. I think Phyllis already told me she's definitely bringing the uh the running shoes this year, right?

SPEAKER_02 8:17

I'm gonna do it this year. I'm gonna but you better do it early because it's Tucson in September. So right.

SPEAKER_00 8:22

Okay. Okay, yeah, yeah. We'll have to do it early, maybe, maybe pre-breakfast. Yes. Yeah, we'll make that happen. We had a good run in Orlando last year, uh, which is another humid place. Well, hot and humid, but maybe Arizona's less humid, but still hot. Yeah, yeah, still very hot.

SPEAKER_02 8:42

Yes. So I'm looking forward to I'm looking forward to our session too, because I know we're gonna change it up a little bit. And rather than it being more lecture style, it's gonna be case study style. So I'm excited for that.

SPEAKER_00 8:52

Yeah, yeah, I can't wait. So, Phyllis, tell us a little bit about your biggest pet peeve in lease administration.

SPEAKER_02 9:02

So, my biggest pet peeve in lease administration is what I will call the data processing mentality.

SPEAKER_01 9:09

Okay.

SPEAKER_02 9:10

And so, you know, lease administration doesn't exist in isolation. So whether it's managed, you know, through internally or through a third-party service provider, it's supporting a business whose core function is likely not real estate, right? We we know that. And so I feel that the most effective lease administrators understand what that business does, what's driving the operations, how real estate facilities supports those objectives, and then they align their work accordingly to that. And so, for an example, in the logistics environment, that's where I'm at today, you know, understanding customer seasonality, space utilization, warehouse configurations can significantly influence how you approach lease administration. For example, it's super important in that industry to understand like the landlord versus the tenant responsibilities, you know, where maintenance and repairs, operational costs can be significant, and knowing who's responsible for those costs, such as roof, HVAC, and it helps avoid unexpected cost and ensures compliance with the lease, and it supports more accurate forecasting and cam review. Um, and then you can take that even further. So just talk about payment processing. So, you know, you'll hear people say lease administrators pay rent. They do far more than pay rent, and there's so much more behind even just that statement of paying rent. So in a global environment, it goes far beyond simply paying you rent. It's understanding currency restrictions, it's understanding cross-border payment policies, internal approval processes, or even your payment timing. You may have different countries that go out on different days, but just knowing when your AP department runs its payment processing, all of that is significant and it plays into, you know, how payments are structured, how they're timed, and it'll help avoid, you know, delays, penalties, compliance issues. And I would say you can even take that even further learning about your company. Do you have legal entity structures? How do those work? Why are they structured the way they are? Do you have tax restructuring initiatives, things that will allow lease administrators to proactively support the business, you know, whether that's, you know, making sure that the when they're reviewing leases that it has the correct entity on it, or if you're getting ready to go through one of those exercises, you'll know your landlords, which ones are going to be more amenable to saying, sure, we'll assign it from one entity or another, or which ones are going to want a lot of information, which ones are going to push back. So I think that is important to you know help get it through the compliance transition. When you connect all of the pieces together, you move beyond processing, you know, transactions and you start to actively support the company's broader goals. So I just feel like that level of understanding allows lease administrators to move from simply managing documents to actively supporting the operational and financial decision making in a business. And I think that's where least admin can really add value in an organization.

SPEAKER_00 12:03

Yeah, I I love that because I think your pet peeve is basically the, as you said, the data processing mentality, right? Like, you know, almost like, oh, woe is me. I'm I'm just here to press the buttons, right? Like I'm I'm just here to get the lease from the email that somebody sends me, type something into the system. Right. But no, I mean, yes, some people do that, but that's not the way to have an exciting and successful career in lease administration, right? Right. And for all the reasons you just mentioned, right, if I summarize it a little bit, you know, we're talking about adding value, you know, even adding exceptional value by understanding how they lease, how the real estate transactions, or if it maybe it's not real estate, maybe it's equipment leases.

unknown 12:54

Right.

SPEAKER_00 12:54

And many equipment leases can even dwarf uh real estate leases at this point. You know, think corporate jets, think ships, think uh data center equipment.

SPEAKER_02 13:05

Data center fiber lines.

SPEAKER_00 13:08

Yeah. These leases that you get in, you're thinking about how the business is using the assets that are acquired through leases, and then all the way through the various uh aspects that Phyllis just mentioned, and even all the way through to the financial statements, right? The effects on the PL, the balance sheet, the cash flow statement, and ultimately the annual report, the 10K and the leases footnote. A professional that understands all of those ramifications and puts it in the terms of the business and the context and the industry that the business operates in, and ultimately in the language of business, which is accounting. That is a very valuable professional. And and you know, Phyllis, I think this has played out in your career. You have lots and lots of opportunities, and we've seen this in other people that we are mutual friends with, right? Lisa Krizik is an example. Exactly. Lisa has had a spectacular career as an executive in lease administration, and she also, like you, parlayed that into lease accounting as well, and and led the whole team at a huge retail company. And I could go on and on. I worked with people at Home Depot, right? Yep. Biggest home improvement retailer in the world, $100 billion company. And uh the head of lease administration there is a friend of mine. She is legitimately an executive, right? This is such a solid career path, lots of value to add. But again, don't fall into the trap of Phyllis's pet peeve, right? Don't be a data processor.

SPEAKER_02 14:50

Be a critical thinker.

SPEAKER_00 14:52

Be a critical thinker, yes. So, Phyllis, I love that. I I really appreciate you joining me today.

SPEAKER_02 14:58

Yes, thank you.

SPEAKER_00 14:59

This is valuable insight for all of us that work in this profession. Let me give you the last word and I'll ask you for two things, right? I'll ask you to sum up your best advice for lease administrators and then tell us how to find your new blog.

SPEAKER_02 15:16

Perfect. My best advice I always say is don't get so caught up in the process of doing business that you never do the business. And I've seen that, I think that spans multiple, you know, different types of careers. But I've seen people that they're always preparing, but they never actually get down to the work. And that's a trap that people get in. And so being prepared is fantastic, but you got to be prepared, but you just got to get in there and do the work. You got to get moving. So my team at Oracle will tell you, because I I've said that multiple times, but that's one of my biggest pieces of it. My second one would be don't be a data processor. You know, think think big, think big, think beyond what's in front of you because no one cares about your career more than you do. So you can sit there and be a data processor with some earbuds in, listening to music, trying to multitask, or you can really take, you know, what you're doing seriously, think about the impacts, think about what's 10 steps ahead of it, where the work's gonna go, and add value that way.

SPEAKER_00 16:15

Awesome.

SPEAKER_02 16:16

And you can find my blog two ways. So I'm very excited about it. And I would love for people to participate in the blog, you know, add comments, ask questions, and they're not for me to answer, but for the whole community to answer. But you can find it either through my LinkedIn profile, which is my name, Phyllis Prudent, and I have my blog linked on there, or you can go to Phyllisprudent.com.

SPEAKER_00 16:37

Okay.

SPEAKER_02 16:38

And it's there. And my name is spelled with one L and two S's. My first thing.

SPEAKER_00 16:44

All right. Great. Well, congratulations on the new blog. Thank you. I have already subscribed, and so looking forward to participating with you on that. And again, thank you so much for joining the podcast today. And uh look forward to seeing you at NRTA later this year.

SPEAKER_02 17:00

Thank you, Matt. I appreciate it.

SPEAKER_00 17:04

Thank you for joining us. I'd be grateful if you would like and subscribe wherever you listen. Perhaps today is your day to get a new lease on. Would you like to learn more about lease accounting? Check out the CGLA program. That's Certified Global Lease Accountant. You can earn 16 hours of CPE credit, study at your own pace, and earn the CGLA professional designation. Find out more at CGLA Institute.com.