Few Questions To Ask Before Hiring A Commercial Property Management Company

Hiring the right commercial property management company can be quite overwhelming. There are many good management firms out there but how do you know which is the right one for you. Thus it is important to find the one that matches your property’s specific needs and interests.  

To make the process simpler, commercial real estate Austin has listed the following questions that you should ask a commercial property management firm before you hire them. This way, you can be assured that you have a qualified and capable commercial property manager by your side that is the right fit for your property.

So, here we go

1. What is the reputation of the Property Management Company?

To hire a property management company in Austin, there are some essential commercial property management tips that you should consider. You also need to check whether the company is reputable, reliable, and is successful in fulfilling your property management needs. You also need to check the firm’s reputation with other clients and professionals in the industry. Client and tenant references can help you determine if the company is reputable or not.

Some other ways of determining the company’s reputation are:

• Ranking of the company in Austin’s Business Journal.

• Different inputs given by leasing brokers in the market. 

• Previous client’s reviews about the company mentioned either online or through referrals.

Additionally, you should also check the reputation of the company among the vendors. Vendors and contractors are the keys to servicing the different needs of industrial properties. The property manager should have strong relationships with the contractors to ensure that when the problem arises, there is somebody present from the team to fix the problem on time. 

A few questions to ask the property manager to ensure that your commercial property is in good hands

• What vendors are they working with for maintenance services?

• Who are some of their clients and what properties are they currently managing?

• Can they give names and contact information for references that you can talk to?

• Do they have testimonials from the clients or tenants that they have worked with recently?

• Who from their firm will be on your management and maintenance team and what percent of the time will be dedicated to each team member?

2. How much experience does the management team have?

Experience is one of the most important factors when it comes to the success of a property management firm. If the firm has a rich experience, they are well aware of how to anticipate your needs and adjust accordingly. The experienced team will know how to respond to a plethora of unforeseen circumstances that your property can face. 

Along with the years of experience, the type of experience is equally important. The property management company should have experience with your property type – industrial property or retail, class A office or mixed-use, etc. Managing different types of properties come with a variety of skills and knowledge, specific challenges, types of tenants, lease intricacies, and more. 

Other factors that should be considered are the property size and its location. The property manager should have his presence in the locale of your property. If you own a larger property, you should check whether the property manager has enough experience in managing a property that big and enough team members to handle it. 

Questions you can ask the property manager to ensure that he has the necessary experience

• What challenges or opportunities can he see for your property? What additional suggestions can he give to improve the property? 

• How long have they been in the business?

• Where is their company located and where will the specific team operate from?

• What types of property have they managed?

• Have they managed a property similar to yours in the past?

• Can they supply the resumes for the management team that will be assigned to your property?

3. Does the Property Management Firm provide the services your property requires?

Property management companies come with a wide variety of services and hiring them is your best bet. But, you should check whether the services they provide match your portfolio of properties.

You also should check that they can adapt to the budgeting and reporting methods that can be required. 

Questions to ask them to ensure that the commercial property manager fits your property needs

• What kind of contingency plans do they have in case of an emergency?

• How will the company help in preparing the budget to reach your property goals?

• What monthly financial statements does the company provide?

• How will the company handle the rent collection process?

• Do they have a maintenance schedule in place? What does it look like?

• What services do they provide?

4. How are the Property Management fees structured?

When hiring a property Management Company, one thing you need to know is their service fees. Management fees are structured based on several factors that influence its pricing. Typically, management fee agreements fall into one of the three structure categories. These categories are nothing but the percentage of the flat fee, hybrid and gross receipts.

A flat fee structure means that you will be charged a flat monthly fee of the property manager which determines to be sufficient to maintain the building and maintain their reasonable margin.

Hybrid fee structures are generally used when the managers are unable to predict the gross receipts accurately. It charges the greater of a flat fee or gross receipt percentage. 

The percentage of gross receipt structure is a percentage of gross revenue and other charges that tenants incur in their occupation. These include operating expense reconciliations, bill backs for tenants with extraordinary utility needs, and so on. The margin runs generally between 2% to 4%. 

The fee amount varies upon several factors like square footage, the number of tenants, vacancy, the service offerings, and the anticipated amount of hard work. The property management company should charge a fee that is in line with your property’s needs.

Questions you can ask them to understand the fees structure associated with hiring a property management company

• What influences their fee structure?

• What characteristics of your property influence the fee amount that they charge?

• Would they structure their fees as a percentage of gross receipts, a flat fee, or a hybrid of the two?

Our final word

As you can see, there are too many things to consider when choosing the right commercial property manager for managing commercial real estate in Austin. The most important thing you should do is to ensure that the property manager you choose for managing your commercial properties is capable of providing the service you need. 

Now that you know what questions you should ask a property manager, you are all set to go ahead. If you are looking for an experienced property manager in Austin, contact GW Partners, a professional commercial real estate austin to take away all your woes of managing your property.

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