There are many similarities between managing residential properties and commercial ones but there are some important differences as well. Commercial tenants are not looking for a home with a good commute to work and a stellar view. They are looking for a property that will be good for their business.
Commercial property managers need to understand that their tenants are operating a business and trying to generate income just as they are. Their focus will be very different and property managers should adjust their strategy accordingly. Here are six commercial property management secrets that experts use to succeed.
1. Constantly Upgrade Your Properties
Upgrades are always a good strategy in the property management business. Investing in your property increases its value while keeping tenants happy. It’s a good strategy regardless of what kind of property you manage but it’s even more important in commercial property management.
Commercial tenants use your property to generate income from which they pay their bills such as your rent. Making upgrades that will help tenants run their business protects you from unpaid rent while building tenant satisfaction and loyalty. Staying on top of new technologies and trends will keep you ahead of the competition in a market where tenants are focused on how the property helps them generate revenue.
As an employer, a commercial tenant wants a space that their employees will enjoy coming to each day. They want their employees to be happy and productive. A modern and up to date property is a more enjoyable workplace than a drab and dated one.
Upgrades don’t need to be complete renovations. Sometimes relatively inexpensive items such as a new photocopy machine, new appliances for the break room, or a television for the reception area can be very effective. Thoughtful but inexpensive upgrades are always better than costly thoughtless ones.
2. Make Repairs While They Are Small
If you conduct regular inspections on your property you will be able to watch for issues in their early stages. Being proactive with maintenance is a big money saver. Savvy property managers know that it’s easier to repair a small leak rather than having to treat mold and rip out flooring due to water damage.
Proactive maintenance is a good idea for any property type but the effects of neglecting issues can be much more severe in commercial properties. That small leak which led to flooding could mean downtime and loss of revenue for your tenant. This could be catastrophic for their business and certainly won’t build tenant loyalty.
3. Prevent Injuries With Preventative Maintenance
Landlords and property managers are responsible for keeping their units safe for tenants and visitors. Uneven flooring can be a tripping hazard, leaks create puddles for people to slip on, and damaged ceiling tiles can fall on someone. Regardless of what type of property you manage it is always important to stay on top of maintenance to prevent dangerous conditions which could lead to injuries and possibly lawsuits.
It is important for property managers to keep all their properties free from hazards but the risk of an injury is much higher in commercial properties. Residential tenants are more aware of potential dangers in their homes and are in a better position to keep anyone in their house safe. Commercial properties are often open to the public, filled with employees, and see many visitors. More people means more opportunity for injury so stay on top of preventative maintenance and be proactive with repairs.
4. Invest In Property Management Software
Keeping records with spreadsheets or even accounting software not designed for property management can be a tedious and time consuming job. The right software will save you a lot of time, give you better information, and help you streamline your operations. There is much to gain from software designed for property management.
Look for accounting software built for property management that can address all of the unique needs of managing rental properties. It doesn’t have to stop there. A good solution should be able to help with aspects such as document management and communication too. Leveraging technology is a commercial property management secret that’s worth the investment.
5. Avoid Creating Competition Between Tenants
If you are managing multiple commercial properties, be mindful of what kind of business you’re placing next to an existing tenant. If there is too much overlap in the target audience of two tenants, they may struggle to generate enough revenue. Use this commercial property management secret to secure your tenant’s ability to pay their rent.
Additionally, that tenant you’ve had for a while is probably not going to appreciate you renting the unit next door to a competitor. It shows that the landlord is thoughtless and has no regard for the wellbeing of the people who rent their units. No tenant will be loyal to a landlord who doesn’t care if their business sinks or swims.
6. The Outside Is Just As Important As the Inside
Curb appeal can attract tenants and help seal the deal on a lease but commercial tenants look at it from a business perspective too. They want a space to work in that they can be proud of. After all, the property where they operate will be a reflection of their business and its values.
A poorly maintained ugly building can easily make potential commercial tenants look elsewhere. For them it’s more than just aesthetics. A building that is falling apart can be a turnoff for customers and that can affect their revenue.
Commercial property management secrets are centered around the needs of commercial tenants. Make investments in the property that will help your tenants be successful and be mindful of factors that help or hinder their ability to generate revenue. Improve the success of your own business by making investments that will help you keep thorough records, organize your documents, and maintain good communication.