Leasing, Brokerage and Property Management Go Hand in Hand

If you own commercial real estate that you lease out, you may have used the services of a licensed real estate broker that specialized in commercial real estate properties in the past. Many owners select from the ala carte menu of potential services offered by real estate firms in our area, but most owners could benefit from a comprehensive asset management approach.

Comprehensive asset management utilizes both property management services and leasing and brokerage services to maintain and enhance the value of a leaseable investment property. Although a comprehensive program from a top firm may appear as an added expense, the result is often an increase in both the net income from the property and value of the asset.

The property management side of asset management involves both the fiscal and the physical maintenance of the property. The fiscal management tasks include timely collection and disbursement of funds related to the investment. Fiscal property management services provided by top real estate firms include rent collection, on time payment of sales and use tax, real estate taxes, and insurance premiums. In addition, fiscal services include contracting, monitoring, and payment for maintenance services and capital improvements. The proper selection of vendors and appropriate periodic inspections of key elements of the property, such as roofs and HVAC systems, can result in significant savings to the investor over time.

A professional property manager will also handle the difficult tenant issues that may arise. Enforcing the conditions of a lease, while maintaining a good relationship with the tenant, can be a formidable task, especially when unforeseen events occur. The recent hurricanes have raised issues about timeliness and expense of repairs, but appearance of mold, roof and window leakage, vandalism, and other unexpected events require prompt attention and mitigation of potential disputes with the tenant.

An efficient and effective property manager will utilize state of the art accounting systems to provide the owner with periodic reports of the income and expenses for the property. If the property management is provided by a top commercial real estate firm, a leasing report will also be included in the periodic reports to the owner. In fact, firms that integrate leasing and brokerage services with property management provide the owners with the benefit of a comprehensive oversight of the property or portfolio of properties. For example, weekly meetings between the property managers and the leasing and brokerage agents improve the overall management of the property. The leasing agent is kept informed of potential vacancies and tenant issues and the property manager becomes aware of new tenant prospects and the requirements for tenant improvements. As a team they work to minimize vacancy, assure a good tenant mix in multi-tenant properties, and enhance the value of the property.

Although the onsite signs are a tried and true marketing tool, commercial leasing and brokerage professionals use a variety of tools to assist in the lease and sale of investment properties. The key tool is experience, which is evidenced by the years of real estate practice, accreditations and designations earned, and participation in key industry organizations. Most experienced professionals use a variety of commercial real estate internet listing and email marketing systems that are designed for the leasing and sale of commercial properties and sophisticated financial management tools to assess the potential value of leaseholds and assets.

To identify key real estate professionals, property owners might look for realtors with designations such as CCIM (Certified Commercial Investment Member) or RPA (Real Property Administrator) or with membership in profession organizations like SIOR (Society of Industrial & Office REALTORS), BOMA (Building Owners and Managers Association), or REIS (Real Estate Investors Society).

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