By Gary Tasman
For investors, the opportunity to earn “passive income” is one of the most appealing parts of commercial property ownership. A well-managed property will generate rental revenue above and beyond the expenses of mortgage payments, interest, and regular upkeep.
However, that doesn’t necessarily mean owning property is necessarily easy. Bookkeeping, rent collection, emergency maintenance, and tenant issues can be time consuming, stressful, and potentially damaging to your bottom line. Many commercial property owners invest in a professional property management service to handle these responsibilities.
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How do you know if you need a professional property manager? There are seven major signals that indicate you may benefit from employing a property manager.
Signs You Need a Property Manager
- You aren’t able to fill your vacant units
While some tenant turnover is natural and can give you an opportunity to perform maintenance or upgrades, vacant units don’t produce cash flow and can quickly turn your financial investment into a financial drain. A professional property manager can market your property to potential tenants, show the units, and process applications and credit checks to ensure your units are generating a return on your investment. - You’ve been burned by delinquent tenants
Most property owners don’t relish the idea of being a landlord, performing collections, managing tenant conflicts, or worse, evicting delinquent tenants. Professional property managers are prepared to deal with these unpleasant activities and provide a buffer between you and your tenants. More important, they have an understanding of the legal issues regarding tenant-landlord relationships to ensure you remain compliant while negotiating these issues. - You own more properties than you could visit in one day
As your commercial property portfolio grows, your ability to respond to on-site issues will shrink. If you live more than 90 minutes from some of your properties, or simply have more properties than you could visit in the course of an eight-hour day, you may not be able to effectively handle your responsibilities in a timely manner. A property management company has the resources to deploy staff quickly and efficiently to manage issues. - You have another full-time job
Even property owners with a small portfolio of real estate investments can struggle to find time to manage their properties when they’re also part of the working world. While investors love the phrase “passive income,” managing a property takes time—and time is money. When property management obligations start interfering with your full-time job responsibilities, it’s time to consider employing a management company. - You’re not sure what to charge your tenants
Knowing how to set the appropriate rent for your property takes a specialized skill. It requires knowledge in accounting, economics, and real estate values in your market. An experienced professional property manager has access to professionals with knowledge and proficiency in each of these areas to ensure your rental rates are appropriate for your facility. - You’ve been accused of discrimination or negligence
As a property owner, there are a host of legal requirements and considerations that affect your business. Commercial real estate activity is dictated by federal, state, and local laws to ensure fair treatment, safe facilities, and liability. A commercial property manager has the legal and regulatory knowledge to avoid these complex issues. Additionally, when tax season rolls around, your property manager’s expertise with legal and financial issues will come in handy. - You struggle to find good vendors/contractors/maintenance workers
Even if you consider yourself to be handy with a plunger or a set of power tools, the maintenance needs of your commercial property will likely extend beyond your abilities. Rather than hunt for an appropriate vendor every time a maintenance issue arises, your commercial property manager likely has a list of vetted professionals ready to assist. Some property management agencies, like Cushman & Wakefield | Commercial Property Southwest Florida, have a facilities management team on staff to handle these issues even more efficiently.
If any of the issues above are becoming a challenge for you, reach out to the professionals at Cushman & Wakefield | Commercial Property Southwest Florida. Our full-service property management team has the knowledge and experience to keep your commercial property running efficiently and profitably. To learn more, call us at 239-489-3600 or contact-us.