Company: CRESW
Filing Date: 2025-10-24
Form Type: 20-F
Source: 0001654954-25-012195
Chunk: 250

Company: CRESUD INC
Filing Date: 2025-10-24
Form: 20-F
Item: Item 5
Chunk 250
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 and commissions, are recognized in the Consolidated Statement of Income and Other Comprehensive Income on a straight-line basis over the term of the leases. When lease incentives are granted, they are recognized as an integral part of the net consideration for the use of the property and are therefore recognized on the same straight-line basis.

Contingent rents, i.e. lease payments that are not fixed at the inception of a lease, are recorded as income in the periods in which they are known and can be determined. Rent increases are recognized when such increases have been agreed with tenants.

Tenants in our shopping malls are also generally charged a non-refundable admission right upon entering a lease contract or renewing an existing one. Admission rights are treated as additional rental income and recognized in the Consolidated Statement of Income and other Comprehensive Income on a straight-line basis over the term of the respective lease agreement.

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We act as our own leasing agent for arranging and closing lease agreements for our shopping malls properties and consequently earn letting fees. Letting fees are paid by tenants upon the successful closing of an agreement. A transaction is considered successfully concluded when both parties have signed the related lease contract. Letting fees received by us are treated as additional rental income and are recognized in the Consolidated Statement of Income and Other Comprehensive Income on a straight-line basis over the term of the lease agreements.

Our lease contracts also provide that common area maintenance charges and collective promotion funds of our shopping malls are borne by the corresponding lessees, generally on a proportional basis. These common area maintenance charges include all expenses necessary for various purposes including, but not limited to, the operation, maintenance, management, safety, preservation, repair, supervision, insurance and enhancement of the shopping malls. The lessor is responsible for determining the need and suitability of incurring a common area expense. We make the original payment for such expenses, which are then reimbursed by the lessees. We consider that it acts as a principal in these cases. Service charge income is presented separately from property operating expenses. Property operating expenses are expensed as incurred. 

Under the terms of the leases, lessees also agree to participate in CPF to be used in advertising and promoting our shopping malls. Each lessee’s participation generally equals a percentage calculated based on the monthly accrued rental prices.

Revenue so derived is also included under rental income and services segregated from advertising and promotion expenses. Such expenses are charged to income when incurred.

On the other hand, revenue includes income from managed operations and other services such as car parking spaces.