It is a fact that property trusts well serve the smaller investor market within retail, industrial, and office property. It directly follows that property trusts should be given special focus by agents and brokers from a sale and or leasing perspective.
It takes a little while to develop the confidence and skill to connect with these ‘high level’ players of the property industry. So how can you reach into this segment of the property market? Let’s look at leasing first.
Targets of Property Trusts
A successful property trust is largely impacted by all of the following:
- Occupancy rates – It is essential that occupancy rates are kept under control as part of an asset management strategy.
- Market rentals – Each year certain market rental expectations are set regards properties in a trust structure. The movement in market rentals will impact investor sentiment and the potential for investment.
- Tenant mix strategies – It is not unusual for an asset manager in a property trust to take a direct involvement with large lease negotiations in a managed portfolio property.
- Property image and success – Investors are attracted to properties that are successful and well known. As smaller investors, they can participate in the bigger property market offering higher yielding sectors.
- Location – Can a property be improved in its location given local property churn and returns? Strategy is everything to a property trust as it strives to improve portfolio results.
- Diversity – Investing in a number of properties and property types allows diversity to minimise investment volatility. As one type of property type in a portfolio may be suffering a decline, other property types can be achieving better results.
- Property management strategies – The quality and knowledge of the property managers and leasing managers servicing portfolios in this trust category must understand how things work and why decisions are made at an asset level.
- Capital growth – Each year it is common for property trusts to seek market valuations of all of the properties within their portfolios. In that way they can understand the capital growth potential of each asset. Lease and tenant mix strategies produce better net rental outcomes and on that basis each lease negotiation is critical to helping the trust improve over time.
A top leasing agent can help with all of those things.
Most property trusts consolidate funds from smaller property investors to purchase larger properties in prime or soon to be prime locations; the future of properties held in trust portfolios can be quite important. The holding lifecycle of the property is then underpinned as the growth and success of the property is achieved. Trusts will acquire all types of properties providing the growth potential is there and future property potential is identifiable.