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02 May The advantages of using a property management company for commercial property
Owning commercial real estate can be disappointing to a financial portfolio unless sound property management practices are employed. Profitability does not come automatically.
Losses, on the other hand, gain momentum, and few owners have pockets deep enough to turn a property around when it is heading down the wrong path.
Every detail of tenant retention, building maintenance, utility consumption, and marketing for new tenants is critical in achieving a profitable bottom line. It requires full-time attention, specific management expertise, and most of all, it requires a daily hands-on awareness of tenant concerns that do not always suit the interests and patience of entrepreneurial owners.
Fortunately, property owners have an attractive alternative to managing the properties themselves. Professional property management firms know how to bring a sharp focus on the day-to-day operational health of property. They are specialists in the profit-loss management of daily affairs, whether it is negotiating with contractors, responding to emergencies, or simply keeping the grounds and building in tip-top condition to enhance the property’s appeal to the community.
There are several specific advantages in using a professional property management company.
The most important concern an owner has is to keep tenant occupancy at a level that returns profits. A management company, acting on behalf of the owner, is dedicated to tenant retention. Keeping tenants happy, signing new leases upon the expiration of old ones is the primary business of a property management company.
To achieve and maintain high occupancy rates require time and responsiveness. A company designed to manage, as opposed to one that is designed to invest, is more suited to the task of keeping tenants happy.
Another advantage that property management companies offer is their existing market presence.
When it is time to fill the lease spaces in a new building, or to replace tenants who have moved elsewhere, a respected presence in the marketplace attracts businesses that are looking for new office space. Owners share in the reputations of their management companies, and they can benefit directly by leveraging the company’s standing in the business community.
Sourcing management to a firm that hires, trains, and promotes professional managers who understand the problems of managing buildings and tenants, and know how to solve them, can assure owners that their long-term investment will not be diluted by empty, poorly maintained properties.