Managing commercial properties is something that is quite different to managing rental homes, but it can still be a lucrative way to earn money. Although they have some shared principles, it is all about how you are able to apply those principles to get the results that you want. You may have a focus on increasing returns and rent, reducing costs and your overheads, or be all about simplifying things, and having fewer issues to deal with when managing them. It is imperative for any commercial management business to identify their goals, and establish them. If this doesn’t happen, then you are likely to bumble along with ad-hoc decisions, without having any clarity or progress with your longer term performance.
When you are looking at what is involved with managing commercial properties, it is likely to be able to be summarised through a few different perspectives. Here are some things to think about.
Property Perspective
This is all about the basics of the physical side of the property. Before you think about who rents it off you, you need to assess the building as a whole. It needs to be in good condition, in order to be hired out safely. Because the business of commercial property investments can be a little cut-and-thrust, this can be an area that can often be forgotten. First thing is to check what condition the property is in, and have a survey carried out, in order to consider what repairs or maintenance, such as backflow prevention may be required. You should also look out for what work former tenants may have done, to check that it is all safe and in order.
People Perspective
No matter what property you have, it is likely to lead to a number of people who will benefit from the property. Whilst this is true for a number of property interests, these interests can start to get even more complicated than other commercial properties. Even if you have a straightforward interest, such as from a landlord or a tenant, it can be more complex than first thought, because of how companies are structured, and things like partnerships and pension funds. There is some good news though that people are more likely to be business-like with your commercial property, which can really help.
Payments Perspective
Having property is something that can lead to money issues. Whether you are an owner looking to get a return on your investment, or want to reduce overheads, there can be issues that you come across. There may be less of an emotional attachment with commercial property, than perhaps residential properties, which could be a reason for the issues.
Rent is going to be a main issue for any kind of property. Which is why it is important to look for a reliable tenant, in order to help you to avoid any potential financial pitfalls. Like any business, there are pros and cons, but the good news is that there are things that you can do to help, should you decide to go into the business of commercial property management.
