The management of commercial and retail property today are complex issues. The profession requires diligent process and highly skilled people. As part of that, the chosen property manager should be reporting to their landlords in a regular and professional way.
The size and the complexity of a property under management will dictate the diversity and depth of the reporting requirement. The type of property will also have an impact on the style of reporting. The manager will need to know how to handle and optimise the property for the landlord.
Every landlord will also have certain requirements when it comes to keeping in touch, information management, approvals, and property manager contact. For this reason, the manager must completely understand the landlord, the property, and the market prior to commencing a management activity or appointment.
Here are some ideas to help you create a property management reporting system for the landlords that you act for.
- Review the property, the leases, and the tenancy mix thoroughly so that you can understand the demands of the property and its potential challenges. Take care when assessing lease management activities, tenancy mix, cash flow management, maintenance activities, and risk controls. Also look at arrears history, and lease critical dates.
- Some properties due to size and complexity will require extensive reporting and detailed control. On this basis, the fee that you set for the appointment should be suitably large based on the work involved. Don’t cut corners with low fees for the sake of having another property in your portfolio. Low management fees only create a workload problem and lack of professionalism within the department over time. Stressed and under resourced managers are usually the result and that will then reflect poorly in the services you provide.
- There are limits as to the numbers of properties and tenants that a property manager can control. To a great degree the limits will be based on the requirements of the landlord, the function and size of the properties, and the requirements of tenant management. I go back to the point that you do need to understand those things at the earliest stages of taking on the property.
- Every week and every month a detailed written report should be dispatched to the landlord summarising activity within the categories of arrears management, lease management, vacancy minimisation, income results, expenditure management, budgeting processes, maintenance activity, and risk management. The report should be in writing so that you have a record of progress when it comes to critical property issues. At the end of each month a full set of financials should be provided to the landlord so they can track income, expenditure, arrears, maintenance and tenant mix issues.
- Properties with multiple tenants will normally need a tenant retention plan and a tenant mix strategy as part of the overall business plan for the property. All of this information should be updated annually. Throughout the financial year the property should be tracked to the targets set within those categories.
- Risk management is a big part of your job. The factors of risk in commercial and retail property are many. Document all factors of risk and be forward looking to prevent issues or problems developing that could threaten the property, the tenants, or the customers.
- If you manage retail property there will be other factors to control and report on such as marketing, customer numbers, sales results, and tenant mix. Your fees for this type of property should be suitably large for the work involved.
So you can see that there is a significant requirement to professionally report to the landlords that you act for. When this is correctly handled, you will find that the control you achieve will give you other opportunities of portfolio growth, leasing opportunity, and fee improvement.