Every day, commercial property managers are quite busy doing things for tenants and landlords. Property activity is ongoing, and the property managers systems are critical to the control and result achieved.
The message here to remember is that property management is not an easy or ‘coasting’ type of job. There are plenty of things that keep coming up each day and require the response of the property manager. Systems applied then help the property manager stay on task and within the targets of the landlord client.
The Value of Experience
The required experience and skills of commercial and retail property managers today will always be high, as the demands on property performance are high.
Think about the changes in the property market now; through all those changes, the property manager must optimize rents, lower vacancies, manage risk and maintenance, and report comprehensively to the landlords that they serve. Property performance is a forward based strategic process.
Creating Property Management Efficiencies
Here are some ways to work with the problems and create some efficiencies:
- Grouping tenant activity and build effective record-keeping processes – the higher the number of buildings managed, the greater the number of tenants and leases to watch. All rentals will be unique in specific terms and conditions, and that is a challenge. The best way to control things will be through the review of the individual leases and then the entry of all critical dates into a computer-based diary system.
- Planning lease negotiations and renewals well in advance – when you look at the tenant mix in a property, the lease expiry and option dates are critical to future cash flows. Tenants come and go from a property based on the success of their business, the space requirements, and the costs of occupancy. Many tenants will move from a property over time for several reasons so look for the motivators. The property manager would be well advised to stay close to all tenants and watch the lease expiry dates 18 months in advance. Negotiations with tenants can then be planned and timed.
- Seeing patterns in property performance with income and expenditure – watch the numbers that impact the net income for the property. Rents do not always rise, and spending by the property owners will always be there. Vacancies can also affect the property and drag down the income stream. To keep control of these things, a yearly compiled business plan for the property can be established, and then the document can be reported to quarterly. Expect that the local economy and business sentiment will have some impact on property performance and occupancy. The business plan can allow for the variables of income and expenditure movement, and budgets can be set for those financial matters.
- Setting up landlord report formats for unique clients – every landlord will have certain focus factors with financial reporting. They will want to know in advance of any expected changes and or recommendations. That is where the landlord report can be so crucial to the future of the property. A sound property reporting system will help you control cash flow expectations and actual numbers comprehensively. I go back to the point that you can structure and implement a business plan for the property and the client.
- Maintenance and risk – in the day to day operations of an investment property, the ongoing support will be required for things such as essential plant, building fabric, cleaning, electrical, and hydraulic matters. Failure to watch the issues here will see an escalation in risk for the property owner, and personal injury to people at the property or those that occupy parts of the asset.
So, there are many things to do here and watch in commercial and retail property management. For property managers to be effective in their day to day tasks, and to be aligned to landlord/client matters, sound systems are required. Watch all the dates, communications, maintenance, documents, and ‘day to day’ operations.
The control and the value that an experienced property manager brings to investment property owners are significant. Are you up to the challenge? Get your time under control and apply proven systems to focus on the most critical investment matters. Your landlords will appreciate the results achieved