Blog
Seasoned real estate investors know that the merit of a property itself is not always as important as the choice of property manager you have onsite. Whether it’s for a small apartment complex or a major shopping mall, property management is one of the most important aspects of ensuring tenant retention and making your property a long-term source of passive income. However, finding the right property management team for a commercial investment is not as easy as it sounds.
Whether you’re an individual investor working with a brokerage or part of a syndication, knowing what to look for in a commercial property manager is essential to success. They should have these five characteristics in order to make your property a value-added investment:
The Five Traits of an Excellent Commercial Property Manager
Specialization – A company that specializes in commercial management is essential for success. While you may be tempted to take your chances on a smaller firm, those that specialize in larger commercial properties will have the tools and services you need to keep tenants and cash flow steady.
A credible tenant screening process – Tenant screening is the best way to avoid turnover and defaults while you own the property. Ask your prospective property management firm about their tenant screening process in detail. What sort of questions do they ask? What about financial reports and prior histories? The more detailed the tenant screening process, the more likely you are to have thriving businesses in your commercial space.
Low turnover rates – Whenvetting property management companies, many investors look at their fees first, when really they should be looking at their turnover rates. The cost of vacancy is typically much higher than the cost of a reputable property management service, so putting your money into a company with the best reputation is worth the higher monthly fees.
A solid marketing plan – Most commercial property managers take on the bulk of marketing for your building as you find new tenants. They should come to you prepared with an extensive marketing plan including pricing according to the regional market, local advertising, and online marketing tactics that will draw in business 24 hours a day.
Ability to manage outside your area – As you expand your commercial real estate portfolio you want the ability to expand into other markets that aren’t right in your backyard. Using the same property management company for properties outside your city or state can ensure continuity and offer you better opportunities to invest.
Property managers can make or break your building’s success in the local market. Legacy offers property management services for all of our investment ventures to ensure you can put your money to work and not have to worry over the day-to-day hassles of your tenant leases. To learn more about our services, contact us today to schedule a consultation.