Investing in commercial real estate can be a promising decision if you choose the right property, purchase price, and location. For new investors in the commercial real estate business, it can be challenging, not only in buying the property but also in management.
Many investors confuse commercial real estate management and residential real estate management. Although these two share some similarities, like having tenants and leasing agreements, commercial properties come with unique challenges that only a qualified real estate manager can tackle. For instance, commercial property managers are in charge of maintenance and oversee the operations of business parks, storage units, lounges, gardens, and other non-residential properties.
In this article, the following are some pro tips to ensure the successful management of your commercial real estate.
1. Use Commercial Property Management Software
Managing multiple industrial centers, office spaces, and retail properties may seem impossible because it entails bulks of information and transaction details. However, with management software, you can merge all those tasks into one platform. The software also helps you organize data and information that would be impossible to handle manually. For instance, you can use the software to send rent alerts to tenants, especially if you’ve got hundreds of them.
When choosing a program software, select one that can keep track of total monthly expenditures, types of tenants, rental income rates, applicable regulations, rent turnover rates, orders for property maintenance, scheduled appointments, clean-ups, and inspections.
Apart from the software program, you can hire professional managers or experts to manage your commercial real estate. Commercial property management Toronto entails management services, including administration, maintenance, and financial services to ensure you get the most from your investment.
2. Have A Proactive Maintenance Plan
Taking good care of and maintaining your property is one of the proven ways to succeed in commercial real estate management. A poorly maintained commercial property turns off potential tenants compared with a beautiful commercial property. Many companies and businesses want an environment where their employees will be comfortable and enjoy working to boost their productivity.
Preventive maintenance also reduces the risk of more considerable expenses that could deter your investment goals. Your investment plan should handle electrical, ventilation, plumbing, pest control, landscaping, infrastructure, heating and cooling systems, replacement of equipment, and any wear and tear.
A good maintenance plan has some benefits that help maintain a good relationship with your tenant, including:
- Reducing maintenance costs: Fixing minor issues before they escalate to bigger issues is an excellent way to save money on commercial property maintenance. For instance, repairing a simple plumbing leak is cheaper than eventually having to tear down and repair parts of your walls and floors to fix an aggravated plumbing issue.
- Preventing injuries: Poorly maintained property can result in dangerous conditions in the building. For instance, tripping on uneven floors, respiratory problems from mold growth, or slippery floors caused by leaks can endanger tenants, guests, and employees. Adopting preventive maintenance can help prevent many of these situations.
- Keep your property value up: Many commercial buildings are rated or valued based on their class or grade, and properties with the best grades attract higher rental fees. Poor maintenance leads to a reduction in class, attracting lower rental fees for the property.
3. Know Your Space Well
Unlike residential properties, commercial property leases can be complex and complicated and need more space optimization. Understanding the needs of each commercial property is the first step to successfully managing the spaces.
Additionally, commercial property managers should know all the ins and outs of the physical spaces they’re managing. This means conducting regular inspections on all units and keeping records of unit use, specifications, condition, and areas of improvement to prevent future issues within the property.
4. Upgrade Your Amenities
Making routine upgrades to your commercial property may sound expensive, but it’s always worth it. Nowadays, commercial renters are always searching for newer spaces with many amenities. To be competitive, consider updating and upgrading your property.
You don’t have to go for the expensive upgrades—there are cheap updates that are effective and will keep your tenants happy and satisfied. These include upgrading smoke detectors, light fixtures, and smaller electrical equipment like copy machines, fans, or television for entertainment. Additionally, look for upgrades that help you save money. For instance, if you want to lower your energy bills, you can replace old heating and cooling systems with smart systems that help save energy.
The Bottom Line
Commercial real estate management is a complex area. Fortunately, the above tips will help you efficiently manage your commercial real estate. These are upgrading your amenities, doing proactive maintenance, using property management software, and knowing the needs of every inch of your premises.