Nothing seems to stop the current exponential growth in real estate markets in North America. House prices and rental rates continue growing, thanks to increased demand and construction, both in the commercial and residential sectors. Even with the growing prices, Americans are not shy to spend a little extra cash to secure good properties. According to U.S. Bureau of Economic Analysis, the economy is expected to grow further by 2.4% in 2016 alone, consequently matching growth rates seen of the past two years. Evidently, everything is going well and things are looking promising, especially in the commercial sector, as more businesses continue setting up shop in urban and rural zones.
If the U.S. Census Bureau is anything to go by, there are more than 28 million small businesses in the U.S recording a growth rate of 49% since the year 1982. This, of course, translates to great potential for the commercial real estate sector.
Unfortunately, it’s not all rosy as it may seem on paper. Abundance of prospective renters doesn’t just simply convert into great returns. Your property and entire business setup, including management, needs to be strategically organized to not only cater to the market, but also seamlessly address critical administration issues. And that’s exactly where commercial property management software comes in.
A good commercial property management software has the potential of substantially improving your rental business on both the tenant and manager’s sides. It’s specifically designed to make running your business easier, so you get time to focus on other important issues. And the best thing about it is the fact that it is SaaS based. That means you don’t have to install the entire system in your computer or tablet to implement it across your property management framework.
Over time, the software will impact your business in the following ways:
Getting New Tenants
One of the hardest things about this business, as many property managers confess, is marketing vacant properties to acquire new tenants. Although there are many digital marketing platforms like social media, getting the word out to warm leads and subsequently passing them through the conversion funnel and tenant screening processes could take long, and cost you money. With the median monthly gross rent in the U.S. standing at more than $992, you can imagine the potential income lost with each passing month of vacant properties.
To save you the trouble of tracking potential tenants and marketing your property, a good property management software comes with automated advertising and tenant screening functionalities. Vacant property is documented and listed on popular rental sites frequented by tenants, as a way of getting the word out to warm leads. All the prospective tenants are subsequently passed through the tenant screening process, to pick out an eventual winner who’s the most suitable candidate for a rental contract. And that saves you the trouble of having to put up with a troublesome tenant for months, and possibly years, after committing yourself to a tenant’s agreement.
Access To Comprehensive Information
Even in an industry like medicine, where records are predominantly written and handled manually, studies have progressively proven the potential errors, not to mention risks of relying on manual systems. One of the things that have been identified by researchers is the complexity and incomprehensiveness of manual records. It’s easy to just pick a pen from your pocket and jot down a couple of notes. Storage, subsequent retrieval and analysis by a third party however, is where the big problem lies. And that’s exactly what has been dragging many businesses behind.
An optimized property management software changes all that. It comes with an expansive database to store data, plus the necessary features to organize, manage and retrieve it 24/7. So, you don’t have to walk around with your notebook or ledger just to track paid and pending rent. All information is available on demand at the touch of button on your computer or mobile tablet.
Streamlining Maintenance Schedules
According to a 2011 report by Rocky Mountain Institute that sampled running costs on a wide range of properties back in 2009, commercial premises usually have the highest maintenance and repair bills, at about $2.00 per square foot every year. Although typical commercial leases place a bulk of the responsibility for maintenance on tenants, landlords still have to take care of all structural repair projects. And we know that it could be hectic, especially if you’re dealing with tenants who work in a fast paced environment, requiring extensive repairs.
A good commercial property management software can ease the trouble, even when you’re dealing with multiple properties at a go. Instead of running between the properties, your office, contractors’ premises and the bank, you can handle everything right from the computer screen. All maintenance requests lodged by tenants are updated in real time, giving you the opportunity to also get in touch with the relevant contractors in time. Swiftly taking care of problems prevents increase in wear and tear, consequently minimizing related costs and keeping your tenants happy. After all the maintenance projects, the system also helps you reconcile all the pending payments to contractors.
Remember back in 2009 when the New York City Housing Authority erroneously overcharged hundreds of welfare families, threatened them with eviction, and even sued a couple of them in court? The problem, which span from September 2008 to May 2009, forced a couple of tenants to attend court sessions, and borrow loans from relatives to offset miscalculated rent. Of course this was very frustrating to the tenants, especially since they were low income families who couldn’t even afford legal representation in court. And that’s just a sample of many possible errors when you manage a range of properties with a system that’s not specifically optimized for property management.
Now, imagine the amount of damage such an incident would cause your businesses, considering the fact that you’re dealing with commercial tenants who can easily take you to court. On the other hand, instead of overcharging your tenants, relying on excel sheets could as well make you a victim of rental fraud. How would you prove, without a shadow of doubt, that a tenant has not paid rent if all you have backing you is a manually updated Excel sheet? We’ve seen skillful fraudsters who can easily dupe property owners into thinking that they actually forgot to update their rental payment records.
A comprehensive property management software can do the heavy lifting for you. All tenants pay rent directly to the system through electronic or check systems, and the records are updated in real time with funds being reconciled with your bank records. This, of course, eliminates the chances of error, and tenants are invoiced according to their actual payments due.
At the end of the day, shifting to a comprehensive commercial property management software will not only improve your operations, but also keep your tenants happy. By paying attention to your tenants needs, you’ll be making their lives easier without even breaking a sweat. And that’s the fundamental concept behind a successful business model.