The term commercial property management can be a bit abstract – what exactly does it mean?
This comprehensive guide will review everything you need to know, including the types of property management, what a property manager does, and other factors to look for.
The Basics of Commercial Property Management
Commercial property management involves overseeing a non-residential real estate investment. Whether it is an office space, retail location, or industrial building, the key is that it requires you to run an income-producing property.
When commercial property management is done right, you can generate more revenue and ensure that your tenants are happy and willing to renew their leases. Similarly, it includes meeting with tenants and potential clients, working with contractors to service the property, building partnerships with real estate associations, and more.
Types of Commercial Property Management
There are four basic types of commercial property management: asset management, property management, development and construction, and leasing and marketing.
Let’s dive into each of these categories in more detail!
Asset management refers to the strategic planning behind your real estate investments. This type of commercial property management looks at financing, lease negotiations, re-development and densification, and more. The goal of Asset Management is to protect the property’s value and increase it as much as possible.
For example, the strategy will address the reasons why you invest in a particular property. What is the upside potential, and how long does the owner intend to own the property? What needs to be done to ensure that you maximize the return on investment for the owner?
Answering these questions is essential to your success and will require analysis of future cash flows and sales values depending on your individual goals.
The next category is property management, which is likely what you automatically think of when considering commercial properties. This includes much of the day-to-day responsibilities, like keeping the space clean and presentable or addressing any maintenance issues.
Likewise, it involves managing tenants and leases to ensure smooth operations. That means it also requires experience with property accounting, collections, budgeting, and other reporting.
Development and Construction
Development and construction are also vital aspects of commercial property management. Land planning, supporting tenant construction, and having the ability to repurpose spaces will ensure that you are maximizing the ultimate value of the property.
As a result, you must carefully manage tenant mix, construction timelines, scope, and budgets.
Leasing and Marketing
The fourth type of commercial property management involves leasing and marketing. You can’t have a retail space without tenants, so you need to curate a desired tenant mix, market to target tenants and negotiate good and fair leases!
Leases can be complex and difficult to read, but it is one of the best opportunities you have to increase the value of your property. This is where working with an experienced property manager can make all the difference.
What does a Property Manager Do?
So, what exactly does a Property Manager do?
Many responsibilities fall under the role of a property manager. They can fall under any of the categories described above, like asset management and leasing, but the day-to-day duties will vary depending on the retail property itself.
Here are some of the most common tasks a commercial property manager must complete:
- Manage leases and tenant contracts
- Supervise maintenance work orders
- Marketing open units
- Resolving tenant complaints or concerns
- Collecting rent and completing property accounting and reporting
- Oversee construction and repurposing projects
- Track KPIs to measure retail assets and investments
As you can see, while some of these responsibilities overlap with residential properties, retail locations have a broader scope.
What Do Commercial Property Managers Look For?
Now that you understand commercial property management, you may be wondering what commercial property managers look for.
When you partner with N3 Commercial Realty, LLC our goal is to provide much more than your basic management services. Whether you need us to perform daily functions or help with asset management, we will work to increase traffic, occupancy, and property NOI.
As professionals in the financial and retail property space, we can develop a custom solution that maximizes your returns. In other words, the goal of commercial property managers is to improve every aspect of your retail investments.