When you manage commercial or retail real estate, you really do need to know what’s going on in the property every day of the week. Regular inspections and meetings with tenants will be part of that.
In larger properties under management, many things can happen each day and thereby challenge your personal organization and business skills.
The diversity of the tenancy mix can also create extra demands on your time in negotiating leases and managing occupancy issues. In your properties, expect that some things that you didn’t expect will happen, and others that you did plan for will take a different direction.
Property Management is full of change, and control systems will help you stay ahead of things and opportunities.
Your lease documents across the property and with each tenancy will be the foundation of occupancy control. Get to know the leases, the tenants, and the critical dates in those documents with every property you manage.
Things to Watch in Organization
Create notes and keep good records as a property manager. Your notes from conversations and meetings will help protect you and or the client when matters take a turn for the worse.
All property markets are different so watch the indicators, your tenancy mix, the rents, the leases, the vacancies, and the maintenance. Factors of change like that will impact your property management processes. Stay ahead of the ‘curve’ as a property manager.
Monitoring Property Events and Issues
The categories of activity that need to be monitored from a property management perspective include the following:
- The marketing and leasing of vacant space to the local business community and potential tenancies is ongoing. Have a plan for targeting the better tenants in your location. You can then fill vacancies from time to time as they arise.
- The optimisation of rental should apply to the existing leases and the tenancy mix. Rents and tenants change through the year. A good way to handle that change is through a property financial and business plan. Know the differences between net and gross rents, and how those matters can be handled in leasing your properties.
- Maintain good relationships with the tenants and the landlord to ensure that the property performance remains on target. There are many interests to focus on with the various stakeholders. Create plenty of meetings and follow up systems to ensure that you are aware of concerns, changes, and challenges in tenancy mix and property performance.
- Budget the activities of income and expenditure as it relates to the property each financial year and then track that activity to the actual cash flow. Everything tends to increase cost wise in commercial and retail property. Your budget is the way to watch what is happening.
- Ensuring that the maintenance of the property complies with laws and regulations associated with the building codes and the occupancy approvals. Emergencies and issues happen regularly when you manage property. What is your emergency response? Have plans in place for controlling major property events and the situation of personal injury or death.
- In the case of retail property, the function of the property should be maintained to match the needs of the asset, the customers and the tenants. This is more critical than in office or industrial property. The age and design of a property will also have an impact on your maintenance systems. Keep good records of all your maintenance events.
- In the case of retail shopping centres, the marketing of the property to the local community will encourage extra trade for the tenants. This underpins the rental for the property and its overall success for the landlord. Everything is linked. You can have a marketing plan in the property business plan. Both documents can be balanced to improve property performance over time.
So these things are separately administered and managed on a daily basis. It is the job of the property manager to oversee and action any events within these categories.
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Complex Property Challenges
A complex property will have further issues to consider in property management, and in the case of very large properties, you will find that further specialised assistance will come from maintenance managers, lease managers, and administrative assistants.
It is interesting to note that the greater experience knowledge and expertise required of a professional property manager will put them in high demand when it comes to complex and modern properties today.
In many cases, commercial and retail property managers have far more experience in the industry than sales and leasing people.
Property managers understand how to optimise the performance of an existing property and then direct it into a new level of activity and success for the landlord. That’s how they can generate plenty of new managements and clients to service.