For many absentee property owners, the benefit of retaining professional Property Management is abundantly clear, yet many local property owners fail to realize the real cost savings of professional management. Many believe Property Management is a vehicle to reduce operational costs and assist in timely rent collection, but this barely scratches the surface of the benefit of a competent Property Management team.
In fact, the whole dynamic of Property Management has changed drastically over the years as property owners struggled to weather economic losses, retain their asset’s occupancies and enhance overall value. The best Property Management teams today have restructured to reflect this changing standard—superseding outdated models and becoming fully-aligned partners who think and act like owners. Utilizing collaborative brokerage relationships, Property Management teams remain completely in tune with ownership’s goals, risk-tolerance level, investment timeline, exit strategy, and specific performance margins.
Our firm believes in this new philosophy so much that we successfully completed an acquisition of one of the area’s most prominent established Property Management operations in May of this year—resulting in a fully-integrated commercial real estate platform armed with significant enhanced capabilities.
By utilizing Property Management as a strategic differentiator through collaboration amongst owners, managers, leasing agents, tenants, and third-party vendors, the result is an innovative operational approach which delivers a more stable rent roll and profitable operating statement. The right tenants are key to this approach and add significant value through long-term lease structures, high-credit regional / national brand backing, and their ability to act as a traffic generators. Skilled Property Management teams employ aggressive campaigns to fill vacancies before expiration to reduce turnover, tactical methods for lease renewals, and in-depth screening and vetting for top quality tenants—ensuring tenant mixes remain accretive to the overall goal of enhancing investment value.
Repairs and Improvements:
When tenants do relocate, the majority of newly-vacated spaces require some degree of tenant improvement. The ability to minimize down time between tenants is vital to ownership’s occupancy goals. Through commercial relationships, expertise in managing contracted improvements, and volume discounts from contractors, professional Property Management teams put the best team on the field to prevent owners from costly delays. Moreover, leading-edge preventative maintenance approaches keep major repairs in check and implement plans for value-added capital improvements including energy efficiency and “green” solutions. Execution at precisely the right time operationally, ensures investment properties remain highly competitive in the market.
While most owner-operators are adept at dealing with most day to day landlord-tenant issues, there is far-reaching benefit to an intermediary or liaison to provide a degree of separation between landlord and tenant. Property Management teams are this liaison. At its very basic level, this intermediary saves ownership valuable time, yet, the potential cost savings is significant. Knowing and ensuring compliance with current landlord/tenant legislation from evictions, to tenant privacy laws, and expertise in legal proceedings is an invaluable asset to any investment portfolio.
Owners who believe property management is a commodity service which “anyone” can do are likely unnecessarily saddled with underperforming assets. In this competitive environment, maintaining tactical excellence is the only path to superior operational performance. Property Management must be recognized and utilized as a strategic differentiator for ownership to realize growing profitability and consistently improving operational statements.