AUDIT COMMITTEE SUMMARY
September 19, 2017
Audit of CCDO Department
Property Management of La Villita and Market Square
Report Issued June 13, 2017
Objective
Determine if City leases at Market Square and La Villita are properly managed.
Background
CCDO's Leasing and Asset Management Division is responsible for the operation and maintenance of city owned real estate and special event venues. CCDO contract coordinators are responsible for managing new lease acquisitions and renewals of the real estate properties. Their duties include invoicing tenants, receiving payments, and confirming tenants' compliance with contract terms.
La Villita Historic Art Village and Market Square are two locations managed by CCDO. Both locations are comprised of city owned retail shops, art galleries and restaurants that are leased to tenants under revenue generating lease agreements.
Revenue consists of rent based on square footage, common area maintenance fees, and utilities fees. The following table illustrates budgeted and actual revenue received in FY2016 and the proposed revenue for FY2017.
Lease Revenue for
La Villita and Market Square
FY2016
Budget
FY2016
Actuals
FY2017 Budget
El Mercado Leases
$ 638,176.00
$ 596,123.53
$ 539,097.00
Farmers Market Leases
731,816.00
736,520.61
750,074.00
Patio Space Leases (Market Square)
174,788.00
166,823.26
168,940.00
La Villita Leases
449,249.00
485,842.28
452,468.00
Total Revenue
$1,994,029.00
$1,985,309.68
$1,910,579.00
Source: SAP
Audit Scope & Methodology
The audit scope included review of key terms identified in the lease agreements for properties at La Villita and Market Square, contract administration plans, tenant files, and city administrative directives. Our audit period was October 1, 2015 through September 30, 2016.
Our methodology consisted of conducting interviews and walkthroughs with key personnel from the CCDO Department. We also reviewed tenant invoices for monthly rent and utilities, and o...
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