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Setting Up A Chart of Accounts For A Property Business: How and Why?

Updated 16 September 2025 

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One of the first critical tasks when setting up your commercial real estate business is creating a chart of accounts (COA). This guide outlines how you record and categorize every financial transaction, ensuring consistent, accurate reporting.

Contents

Why a well structured chart of accounts matters

A well-constructed chart of accounts is more than just a list of accounts; it’s the backbone of your financial management system. It allows you to:

  1. Organize Financial Transactions: Every financial transaction is linked to a specific account, ensuring that your records are precise and complete.
  2. Communicate Financial Information: Whether sharing data with bankers, accountants, or investors, your chart of accounts provides a clear picture of your financial health.
  3. Simplify Tax Filing: By categorizing transactions properly, you can streamline tax preparation and compliance.
  4. Make Informed Decisions: A detailed and organized chart of accounts enables you to monitor your business performance, identify trends, and make data-driven decisions.

Starting with a well-structured chart of accounts can save you from costly rework and help you see your business operations clearly from the outset.

Key Components of a Chart of Accounts

The chart of accounts is generally set up within your accounting platforms, which means you don't have to set it up inside of your property management solution. With Re-Leased 
you have extensive two way integrations into a number of different specialised accounting systems that automatically pull through data from your accounting systems. 

At its highest level, a chart of accounts for a commercial real estate business includes the following categories:

  1. Assets
  2. Liabilities
  3. Equity
  4. Revenues
  5. Expenses

While there is no universally standardized format for a chart of accounts, a typical structure groups accounts into blocks (e.g., 1000-1999 for assets) to allow for flexibility and growth as your business expands.

What we recommend for account structure

Below is a suggested numbering scheme for your chart of accounts broken by type. This framework is designed to accommodate the unique needs of a commercial real estate business:

Number Main Category Purpose
1000 - 1999 Assets (This includes Bank, Fixed Assets) Bank accounts, commercial properties, equipment, etc.
2000 - 2999 Liabilities (Can be long-term liabilities or short term) Mortgages, loans, accounts payable, etc.
3000 - 3999 Owner's Equity Owner contributions, retained earnings
4000 - 4999 Revenues/ Income Rental income, management fees, other income
5000 - 5999 Cost of Goods & Services Sold (COGS) Costs directly related to providing services or products
6000 - 7999 Expenses Operating expenses, utilities, maintenance, etc.

 

A more detailed version

Here is a more detailed breakdown of individual accounts that a commercial real estate business might use:

Account Number Account Description Type Use
1100 Checking Account Bank Record all deposits and withdrawals
1200 Escrow Account Bank Funds held for property taxes, insurance, etc.
1400 Accounts Receivable Asset Unpaid rents and other receivables
1600 Land Fixed Asset Value of the land associated with each property
1700 Property Improvements Fixed Asset Capitalized property improvements
1800 Accumulated Depreciation Fixed Asset Depreciation of properties (excluding land)
1900 Commercial Property Fixed Asset Value of each commercial property owned
2500 Credit Cards Liability All credit card transactions
2600 Mortgages Long-Term Liability Mortgages associated with each property
3000 Owner’s Equity Equity Owner investments and retained earnings
4100 Rental Income Income Rental income from properties
4200 Other Income Income Income from services like parking fees, storage, etc.
6000 Marketing Expense Expense Advertising, promotional expenses
6100 Professional Fees Expense Legal, accounting, consulting fees
7000 Operating Expenses Expense Utility costs, repairs, maintenance, etc.
7100 Property Taxes Expense Taxes on owned properties
7200 Insurance Expense Insurance premiums for properties
7700 Management Fees Expense Fees paid to property management firms
7900 Repairs and Maintenance Expense Costs associated with property upkeep
8000 Utilities Expense Water, gas, electricity expenses
8500 Office Supplies Expense General office expenses
8700 Miscellaneous Expense Other expenses that don’t fit into specific categories

 

The above chart of accounts will vary if your business only manages property instead of owning it.

Tracking Multiple Properties

To manage multiple properties effectively, consider setting up sub-accounts under your main accounts. For example:

 

Account Number Account Description Type Property
1900  Property - Main Fixed Asset  
1901 123 Britomart Fixed Asset Property 1
1902 456 Wynyard Quarter Fixed Asset Property 2
1903 346 Ponsonby Road Fixed Asset Property 3

 

This structure enables you to track the financial performance of each property separately, making it easier to manage your portfolio.

Using Classes for Enhanced Tracking

Classes allow you to further break down expenses by property or project. For example, you could track maintenance expenses separately for each building within a commercial complex. This granularity is especially useful for profit and loss reports.

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About the Author

Image from iOS-3Dulan Perera
Director, Demand Gen


Dulan combines strategic marketing expertise with deep knowledge of commercial real estate (CRE) to drive meaningful growth across the industry. His focus is on connecting property professionals with insights that matter, spanning compliance, financial operations, property management, stakeholder relationships, and the evolving role of technology and AI. His goal: help real estate businesses scale smarter in a digital-first world.

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