Commercial property management is perhaps the busiest and most intense part of the property industry. The knowledge that the property manager brings to the task is significant and special. Putting it quite simply, these people work very hard and should be carefully chosen for the buildings they manage.
Are the best managers for the role sourced elsewhere or are they allowed to rise through the ranks and other roles in the office? The answer is probably both. Importantly the person chosen for the role has to handle investment strategies for the landlord and occupancy issues for the tenants. This requires solid intelligence and analytical skills.
Retail property is even more advanced on the skill level scale. So much damage can be done to a property if the manager is underskilled or not well supported. All this requires a reasonable fee base of course. If the management fees are a recoverable item in a lease then it is a no brainer for the landlord to chose the best people to manage their property.
Low fees for property management produce poor levels of control in the property. The landlord and the tenants suffer.
It is very important that the bosses and proprietors of real estate businesses choose managers carefully. A well selected person will do the following for the real estate business:
- Stabilise the property portfolio so cash flow is optimised
- Attract more property tenants to the building when vacancy is pending
- Encourage landlords to grow their property portfolio into diverse and well performing property
- Provide a diverse commission fee base from well managed property including lease fees, rent review fees, and lease options
- Minimise the vacancy factors for landlords in times of property growth and or pressure
- Optimise the performance of the building outgoings in parity with the trends of the market
- Build a better business for the real estate agent proprietor
- Help the landlord build a better property income base
- Provide a building business plan that matches the targets of the property investor and the investment lifecycle that they require
- A good property management portfolio is a significant source of saleable listings in the future.
So a commercial property manager, is an essential part of the professional commercial real estate business. I would even go so far as to say that the best salespeople were grounded in the industry from a base of commercial property management.
Yes the mindset of a property manager is totally different to that of a salesperson, however the knowledge that comes from the role is high and relevant.
The management job provides real experience in legal, marketing, negotiation, lease structures, outgoings management, and property performance. Salespeople do not normally get that diversity as they move through their career.
The mindset required by a property manager is one of the diligence's to the daily management task, accuracy in financial analysis, excellent communication skills, and dedication to the landlords plans and targets. When a landlord is well served, the manager brings stability to the cash flow of real estate business. Extra commissions are possible though leasing, lease renewals, and rent review negotiations. The property manager also needs to be well versed in the negotiations and elements surrounding lease occupancy and enforcement relative to each property.
If you need to find a commercial property manager for your real estate business, select the person that brings a real future to the portfolio and can strengthen the relationships with your landlords. A commercial real estate portfolio can then grow from the skills of the property management team.