InterServer Web Hosting and VPS
Quickbooks for Commercial Real Estate

Quickbooks for Commercial Real Estate

The most used financial software platform worldwide is QuickBooks. It is simple to use, reasonably priced, and suitable for almost any industry, including commercial real estate. For these reasons, small- to medium-sized real estate businesses favor it as their preferred software.

Many owners of commercial real estate firms believe that as their companies expand, so do QuickBooks. Some business owners opt to employ time-consuming, prone to user mistakes manual entry spreadsheets. Others spend tens of thousands of dollars on business-level software that has pricey subscription costs and convoluted user interfaces. Smart business owners know how to successfully expand their organization by combining integrated tools like STRATAFOLIO with QuickBooks’ basic features.

Quickbooks for Commercial Real Estate

Reasons Commercial Real Estate Owners Need QuickBooks

Payroll is only one of the many add-on choices available with QuickBooks. These add-ons are available in the QuickBooks marketplace to help you with a variety of business management tasks. Numerous daily transactions with tenants are documented because stand-alone property management systems are primarily designed to benefit property managers and tenants. However, they fall short of giving you a comprehensive commercial perspective.

These systems’ owner statements only include information on rental income, expenses, and owner withdrawals. Most real estate owners require additional accounting services, such as managing loans, payroll, and overhead expenses. As a result, owners often use a standalone property management system in addition to QuickBooks. Double-entry of data is necessary in these fragmented systems in order to view performance holistically.

Because of STRATAFOLIO’s seamless interface with QuickBooks, you won’t need to enter the same data twice to receive a comprehensive perspective of your business.

Ease of Invoicing/Posting Payments in QuickBooks 

How to make an invoice is one of the first features that QuickBooks users learn. The QuickBooks system’s main functionality—basic invoicing followed by payment receipts—allows for a great deal of flexibility and customization. However, tracking becomes difficult very quickly when you have dozens of renters (or more!) who have lease rate increases. And, a location that many owners overlook, costing them money. This is made simple by STRATAFOLIO’s capabilities, such as the built-in invoicing reminders and lease escalation tracking. With the help of our program’s Bulk Invoicing feature, you may bill all of your renters at once with their most recent CAM costs and lease rates. Even if the renters are in several QuickBooks files, STRATAFOLIO makes it easy to invoice and collect payments.

Your Team Can Access Their Data from Anywhere

In QuickBooks Desktop, the multi-user mode enables you to grant access to other team members and your accountant. It’s even simpler to access with QuickBooks Online. Since STRATAFOLIO is cloud-based, you won’t ever need to be concerned about losing access to crucial papers. Anywhere you have an internet connection, you have access to your data. Multiple user access levels are available in STRATAFOLIO to suit the needs of your entire company. The number of users who can be added is unrestricted.

Automatically Updated 

There is never a need to upgrade to a new version if you use QuickBooks Online with STRATAFOLIO because the program updates automatically. You won’t have to worry about losing crucial data or making software changes in the middle of the year that can mess up your taxes because you’ll always have the newest versions of QuickBooks and STRATAFOLIO.

QuickBooks – Built for Growth

Your firm can expand while maintaining the records you need for each asset you possess by using QuickBooks’ classes function or making a new company file. It’s as easy as adding another class or QuickBooks company file to add more assets to your portfolio in QuickBooks. It is as simple as adding another structure in STRATAFOLIO. You can have an unlimited amount of Assets and Tenants in any system, allowing you to develop and grow your company.

Available, Knowledgeable QuickBooks Experts

A standard in accounting is QuickBooks. The majority of seasoned accountants are familiar with the program. Additionally, a sizable network of proficient bookkeepers with QuickBooks knowledge exists. When you need assistance, our certified QuickBooks specialists at STRATAFOLIO are here to help. QuickBooks is a reliable corporation with easily accessible support resources, and it is user-friendly for all skill levels. STRATAFOLIO and QuickBooks Online both offer the highest level of protection. Your files are therefore always secure, negating the need for backups. Most people still use QuickBooks as their accounting software of choice. And, according to more than 18,000 customer evaluations on Capterra, has received a 4.5 out of 5 star rating.

Comprehensive View of All Your Properties

When using QuickBooks with STRATAFOLIO, all accounting and financial operations are handled by a single system. As a result, your commercial real estate business is more efficient and investors are more confident in you. Property managers typically use QuickBooks for overhead and payroll while keeping track of costs and income in a different system. However, using STRATAFOLIO, you can easily view your whole cash flow across all QuickBooks accounts.

With the help of STRATAFOLIO and QuickBooks, you can manage both your real estate transactions and business overhead expenditures using a single accounting tool. You have several options for running reports when reporting. Create reports using the account, class, or month. Alternatively, you could use customized report options or save a favorite. A better comprehensive perspective of their portfolios is needed by real estate investors. In contrast to standalone property management systems that are unable to handle loans, salaries, and overhead, STRATAFOLIO’s Owner Dashboard offers a graphic representation of the accounting data of a full business, by entity, or even per building. Running QuickBooks alongside STRATAFOLIO gives you access to an integrated asset management and full accounting solution.

Commercial Real Estate Accounting

What Is Commercial Real Estate?

Commercial real estate (CRE) is land that is only used for business-related activities or to offer a workspace, as opposed to being utilized as a residence, which would fall under the category of residential real estate. Most frequently, renters are leased commercial real estate to conduct businesses that generate cash. This vast category of real estate can range from a small shopping mall to a single storefront.

There are several types of commercial real estate. It could be anything, such as an office complex, a duplex, a restaurant, or even a warehouse. Commercial real estate can provide income for people, businesses, and corporate interests by renting it out or by keeping it and reselling it.

Retailers of all kinds, office space, hotels, and other types of commercial real estate fall into a number of different categories.

Commercial Leases

Some companies own the structures they operate out of. The commercial property is leased, though, which is the more frequent scenario. The building is typically owned by an investor or group of investors, who then charge each business that uses it rent. Commercial lease rates, which represent the cost to use a facility for a specific amount of time, are typically indicated in annual rental dollars per square foot. Residential real estate rates, on the other hand, are quoted as an annual sum or a monthly rent.

Commercial leases often last one year to ten years or longer, with office and retail space having lease terms of five to ten years as the norm. 1 This might be contrasted with residential leases that are more frequently annual or month-to-month.

According to a study by real estate market analyst CBRE Group, the length of a lease is inversely correlated with the size of the space being rented.

The data also demonstrated that, in a rising market situation, tenants would sign long leases to lock in pricing. But it’s not the only thing that motivates them. Due to the scarcity of properties that meet their needs, several renters who need huge spaces sign long-term leases.

Managing Commercial Real Estate

Leasing commercial real estate needs the owner to manage it fully and continuously. A commercial real estate management company can assist property owners with finding, managing, and keeping tenants, supervising leases and financing alternatives, and coordinating maintenance and marketability of the property. As the laws governing such property differ by state, county, municipality, industry, and size, the expertise of a commercial real estate management business is beneficial.

Landlords frequently have to manage increasing rents while reducing vacancies and tenant turnover. As a result of the necessity to modify space to fit the unique requirements of various tenants, such as when a restaurant moves into a building that was formerly home to a yoga studio, turnover can be expensive for CRE owners.

Advantages of Commercial Real Estate

Attractive leasing rates are one of the main advantages of commercial real estate. Commercial real estate can offer spectacular profits and sizeable monthly cash flows in regions where the amount of new construction is constrained by the land or the law. Compared to an office tower, industrial buildings often rent for less money, but they also have lesser overhead expenses.

Additionally, compared to residential real estate, commercial real estate benefits from comparable lengthier lease agreements with tenants. As long as the property is occupied by long-term tenants, this lengthy lease period provides the owner of commercial real estate with a sizable level of cash flow stability.

Commercial real estate provides a reliable and abundant source of income as well as the possibility of capital growth, provided the building is well-maintained and kept current. Additionally, it is a unique asset class that can offer a strong diversification choice to a well-balanced portfolio, just like all types of real estate.

Disadvantages of Commercial Real Estate

The main obstacles for most people who desire to directly invest in commercial real estate are rules and regulations. Legalese is used to hide the taxes, purchasing procedures, and maintenance obligations for commercial buildings. These specifications vary depending on the state, county, industry, size, zoning, and a variety of other classifications. The majority of commercial real estate investors either possess specific knowledge or have employees who do.

Another obstacle is the higher risk that comes with tenant turnover, which is particularly important in an economy where unanticipated retail closures leave premises vacant with little warning.

The amenities needs of one renter in a house typically coincide with those of earlier or upcoming tenants. With a commercial property, however, each tenant could have quite different needs that call for pricey renovations. The building owner must then modify the area to suit each tenant’s unique trade. Due to the expense of renovations for new tenants, a commercial property with low vacancy but rapid tenant turnover may nonetheless experience a loss.

Purchasing a commercial property is substantially more expensive than buying a residential one for individuals wishing to invest directly. Additionally, although real estate is one of the most illiquid asset types, deals for commercial buildings typically proceed more slowly.

Benefits of Good Accounting in Commercial Real Estate 

Investors and owners can see business-changing improvements in their profit by implementing good accounting practices within their processes. 

Improve Cash Flow
Completing accounting statements accurately and timely allow for other tasks like rent statements or vender tabs to be taken care of quicker, showing an improved method in cash flow.

Control Income and Expenses
Keeping track of all income and expenses can help investors maximize their revenue. For example, when a tenant pays their rent, the owner can track the payment and notice room to spend on a needed or profitable expense.

Reduce Outside Expenses
In addition to having control over income and expenses, investors will be able to reduce their number of outside costs. Good accounting will be orderly and up-to-date in real-time, leaving room for minimal error and the extra cost of fixing those errors.

Backup For a Tax Audit
An investor may never be audited, but there holds a chance and possibility. Good real estate accounting will keep track of all income and expenses incase it is asked for by the IRS, eliminating the daunting task of trying to compile all this information quickly.

Monitor Property Performance
Detailed accounting done the right way will make monitoring the financial performance of investor properties and portfolios easier. Comparison of the metrics helps give insight into the positives and negatives and the steps that need to be taken to maximize revenues.

Commercial Real Estate Chart of Accounts

Because they are necessary for creating a financial budget, charts of accounts and bookkeeping are crucial for real estate businesses. Additionally, complicated processes are used in the real estate industry for everything from purchasing and selling to property maintenance. Therefore, it’s crucial to maintain track of financial transactions. We’ll go over a real estate chart of accounts and bookkeeping techniques in this article.

Real estate agents can protect their financial security and keep organized for important tax compliance and collection chores by using a well-prepared chart of accounts. You may organize and streamline your company’s complex financial data with the real estate chart of accounts. Organizing data into comprehensible, logical account categories is beneficial. It also helps create financial models for real estate.

A real estate company’s chart of accounts shows all the accounts for your company organized in one place. It provides you with a bird’s-eye perspective of all of your company’s financial transactions. Due to the unique nature of the business and separate accounts, the real estate chart of accounts will be different from that of other firms.

You can use a chart of accounts to group all of your business’s transactions throughout a specific period of time. By dividing your revenue, liabilities, assets, equity, and business expenses, it also enables you to gain insight into the effectiveness of various parts of your organization. The chart of accounts also assists in financial budgeting and planning by listing all the accounts involved in your company’s daily operations.

The account names, brief descriptions, and unique account identification codes are all provided in the chart of accounts. The accounts for the income statement are listed after the accounts for the balance sheet.

Assets, liabilities, and shareholders’ equity make up the balance sheet accounts, which are further divided into numerous subcategories. Revenues and expenses are broken down further into sub-categories in the accounts that make up the income statement.

Setting Up the Chart of Accounts

The accounts that are specified while creating a chart of accounts largely depend on the type of business being run. For instance, a taxi company will have some accounts that are unique to the industry in addition to the generic accounts that apply to all companies. For instance, the taxi company will include a fuel expense account, which is not typical for businesses, but will omit an inventory account because it is a service company and does not keep stock.

Normally, a numerical system should be used to easily identify the accounts when listing them in the chart of accounts. Additionally, numbering makes it simple to record a transaction. Large firms typically use four-digit numbers because they have room for more digits as their operations expand, whereas small enterprises typically use three-digit numbers.

Each of the five major categories is given a set of numbers, with blank spaces at the end to accommodate future additions of more accounts. Additionally, the numbering needs to be uniform to make it simpler for management to roll up data from one period to the next.

Categories on the Chart of Accounts

Each of the accounts in the chart of accounts corresponds to the two main financial statements, i.e., the balance sheet and income statement.

Balance sheet accounts

Such accounts are required when creating a balance sheet for the business. Balance sheet accounts comprise the following:

1. Asset accounts

The asset account provides a list of all the categories of assets that the business owns. The account may include intangible assets (such as trademarks, patents, and software), current assets (such as cash on hand, accounts receivable, and

Each asset account can be numbered in a sequence such as 1000, 1020, 1040, 1060, etc. The numbering follows the traditional format of the balance sheet by starting with the current assets, followed by the fixed assets.

2. Liability accounts

Liability accounts provide a list of categories for all the debts that the business owes its creditors. Typically, liability accounts will include the word “payable” in their name and may include accounts payable, invoices payable, salaries payable, interest payable, etc.

Liability accounts also follow the traditional balance sheet format by starting with the current liabilities, followed by long-term liabilities. The number system for each liability account can start from 2000 and use a sequence that is easy to follow and compare in different accounting periods.

3. Owner’s equity accounts

Equity represents the value that is left in the business after deducting all the liabilities from the assets. Owner’s equity measures how valuable the company is to the shareholders of the company.

Some of the components of the owner’s equity accounts include common stock, preferred stock, and retained earnings. The numbering system of the owner’s equity account for a large company can continue from the liability accounts and start from 3000 to 3999.


Real estate agents and brokers use QuickBooks for several reasons. It’s a comprehensive accounting software that helps them track their income, expenses and balance sheet, but also to manage their leases, general ledger and mortgage payments.

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *