It is easy to misunderstand commercial property management and the important role that it can play in the performance of a property today. It is also easy to misunderstand or underestimate the importance of skill and knowledge when it comes to choosing the right person to be a property manager of an important property. That is why a guide to commercial property management is needed. Here are some tips from our Newsletter.
What is it?
Commercial property management is a number of things that are interwoven into each other. When it comes to property performance for any landlord all the factors of the property should be well balanced. That is why a good manager is required to control the services and property tasks for the landlord.
Ultimately the landlord wants a property that is under control from many different perspectives. Here are some of the big and important ones to control in any agent providing a commercial property management services:
- Rent has to be collected on time and in accordance with the terms of the tenants lease. The critical dates of the lease will be important to the process.
- Arrears management and recovery is part of a quality property management service today. Watching the payment of rents is one important thing for any manager; knowing how to recover unpaid monies is another.
- All the leases will need to be understood and interpreted to help with the tenant mix and the lease strategy. Understanding leases is therefore a key part of a property manager’s job.
- Standard leases will come in many forms and will be relative to the property owner and the property. Knowing the right lease to negotiate on a property will help with the income and the tenant mix.
- Rental types will either be gross or net rent, but there are variations to those rent types and most particularly the outgoings recovery will have an impact on the rent type chosen. Choosing the right rent type based on industry standards relative to the property will help your chances of leasing the property.
- Lease incentives will be part of many lease negotiations today. You will need to know a lot about market rents in your local area and relative to the property type.
- Outgoings are a cost of running the property. Some of those outgoings can be recovered as part of leasing the premises. A good property manager will know how to recover the outgoings in the best way possible and in accordance with the terms of the lease.
- Maintenance costs will need to be controlled. That will involve a budget for income and expenditure. Good financial controls and strategies will be required when it comes to managing any quality property.
- Code compliance relates to the essential services and design of the property. You will need experts to help you with the rules and regulations that apply to the property design and code compliance.
- Vacancy management and minimization is part and parcel of your services that must be provided. If a vacancy exists then it needs to be filled quickly at a realistic market rent.
- Tenant communications should always be maintained to keep the property stable from a tenant mix perspective. Good tenant communications will reduce the vacancy threat in any property today.
- The ability to negotiate a lease or the terms of occupancy for a tenant is quite a specialized task. The manager is required to be centrally involved in any new lease negotiation with new tenants to a property.
So these are some of the bigger facts to consider. A property manager must therefore know how to do these things. When they are correctly provided, a fair and reasonable fee should be paid by the client for this optimal level of control.
If you want more tips for Commercial Real Estate Property Management you can get them in our Newsletter right here.