If you’re a Commercial Realtor, it would be helpful to know how to effectively collaborate with property management firms in order to better serve your clients' needs. Here are a few things to consider:
Roles and Responsibilities: commercial property managers are responsible for day-to-day operations, tenant relations, maintenance, and financial management of properties on behalf of property owners;
Local Expertise: commercial property management firms often have extensive local knowledge (in the case of GV Property Management, this is in the Greater Toronto Area and Barrie), which can be valuable to commercial Realtors. Property management firms can provide insights into market trends, rental rates, and neighborhood dynamics, helping Realtors make informed decisions when buying or selling commercial properties.
Tenant Relations: competent commercial property managers play a crucial role in maintaining positive tenant relations, which helps lower the operational cost for commercial real estate investors. Commercial Realtors should recognize that satisfied tenants are more likely to stay in a property, reducing turnover and vacancy rates, which can positively impact property values and investment returns.
Property Valuation: commercial property managers can assist Realtors by providing information on a property's historical performance, including rental income, expenses, and maintenance costs. This data can be crucial when determining the market value of a property.
Regulatory Compliance: experienced commercial property management firms are well-versed in local and provincial regulations related to rental properties. Commercial Realtors should understand the importance of compliance with these regulations to avoid legal issues and potential liabilities.
Property Maintenance: well-maintained properties are more attractive to potential buyers and investors. Commercial property management firms can help ensure that properties are in good condition, which can enhance their marketability.
Tenant Screening: commercial property managers may be responsible for tenant screening and selection. Commercial Realtors should appreciate the importance of thorough tenant screening in reducing the risk of problematic tenants who may cause issues for property owners.
Communication: effective communication between commercial Realtors and property management firms is essential. It would be wise for Realtors to establish open lines of communication to share information about property listings, upcoming expected vacancies, and potential buyers or investors.
Marketing and Promotion: commercial Realtors may need to work closely with property management firms to market and promote commercial properties for lease or sale. Coordination on advertising, showings, and property tours can help attract potential tenants or buyers.
Financial Reporting: commercial property management firms typically provide detailed financial reports to property owners. Commercial Realtors should be aware of the financial aspects of property management, including rent collection, expense tracking, and financial reporting, as these can impact the property's overall performance and value.
Contractual Agreements: commercial Realtors would be wise to understand the contractual agreements between property owners and property management firms, when they are able to obtain this information. This includes compensation structures, responsibilities, and termination clauses, as it can impact negotiations and transactions.
It is thus advisable for Commercial Realtors to recognize the complementary roles of property management firms in the commercial real estate ecosystem. A collaborative approach and a good understanding of commercial property management processes can lead to successful transactions and satisfied clients.
About the author: Alex Rascanu held senior marketing and senior policy advisory roles before entering the real estate industry, where he provides buy and sell-side commercial and residential real estate advisory services in the Toronto area. Alex completed a bachelor of business administration from the University of Toronto and a masters of public administration (management) from Dalhousie University, and is a registered real estate sales representative with Right at Home Realty, Brokerage. Connect with Alex Rascanu: on LinkedIn, Instagram, and YouTube, and via email at alex@rascanu.com.
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