Why You Need a Commercial Property Management Company

While it may be possible to manage a small commercial property on your own, if you're hoping to expand your portfolio of properties—or just want to free up your own time—hiring a property management company can be a smart, cost-effective investment.

A commercial property manager can:

• Fill vacancies in a timely manner
• Maximize the value of your lease agreements
• Handle both day-to-day and emergency maintenance
• Build and maintain good relationships with tenants
• Take care of accounting and provide regular financial statements

No matter what the scale of your commercial property, a professional property management company can help improve your ROI. 

In this guide, we’ll dive into the considerations that come with hiring a commercial property manager including what they cost, the services they offer, and how to hire the best property manager for your specific needs. Learn more below, or use our commercial property management company search tool above to get started today!

What is a Commercial Real Estate Property Manager?

A commercial real estate property manager is a professional tasked with overseeing the day-to-day operations of commercial properties, such as office buildings, shopping centers, industrial parks, and multifamily residential buildings. Their primary responsibility is to manage the property in a way that maximizes its value and profitability for the owner.

This includes a range of duties from leasing vacant spaces and maintaining the property to managing tenant relations and ensuring compliance with all local laws and regulations. The role requires a blend of strong interpersonal skills, financial acumen, and a deep understanding of the real estate market and property management laws.

What Does a Property Manager Do?

A commercial property manager’s responsibilities are extensive and vary significantly depending on the property type and the management agreement.

Generally, they handle the leasing process, including marketing vacancies, screening potential tenants, and negotiating leases. They also manage tenant relations, addressing complaints and facilitating repairs and upgrades as needed. Financial duties include collecting rent, preparing budgets, and maintaining financial records.

Additionally, property managers keep the properties they oversee in compliance with all applicable laws and regulations, performing regular inspections and coordinating maintenance and security services to keep the property safe and appealing.

How Much Does a Commercial Real Estate Property Manager Cost?

The cost of hiring a commercial real estate property manager varies widely based on the location, type of property, and the scope of services provided. Typically, managers charge a fee based on a percentage of the monthly rental income, which can range from 3% to 10% or more. For larger commercial properties or those requiring extensive management services, fees can be on the higher end.

Additionally, property managers might charge extra for services such as tenant placement, construction management, or major renovation oversight. Property owners should clearly understand what services are included in the management fee and what might incur additional charges to avoid unexpected expenses.

Key Considerations When Searching for a Commercial Property Manager

Managing commercial properties requires different expertise than the management of residential buildings. While there is some overlap in the skills required, you should look for a property management company that is either specifically dedicated to commercial property management or has a team devoted exclusively to commercial.

Explore some of the most important considerations to keep in mind while searching for a commercial property management company.

Experience and Specialization

A commercial property manager should have extensive experience managing the type of properties that you own, whether those are office spaces, retail locations, or industrial sites. Their expertise should encompass various aspects of property management, including lease negotiation, tenant retention, and operational maintenance.

Familiarity with the local real estate market trends and tenant demographics can help maximize your property's potential and address specific challenges efficiently.

Reputation and Reviews

Investigate the property manager's reputation by examining online reviews, testimonials, and their standing in local or national real estate associations. A reputable manager typically has a history of positive feedback and a strong track record in managing commercial properties effectively.

This research will help you gauge their reliability and performance from the experiences of other property owners and tenants.

Services Offered

Confirm that the property manager offers a comprehensive suite of services for effective management, such as tenant screening, lease administration, property maintenance, and 24/7 emergency response. Additionally, inquire about their strategies for marketing vacant properties and maintaining high occupancy rates. You should start your search with a checklist of services you support for, ideally arranged in order of importance. 

Communication and Reporting

Effective communication is a cornerstone of property management. Your property manager should have a clearly defined plan for regular updates and should demonstrate that they will be responsive to your inquiries and concerns.

They should also provide detailed financial reports and analytics on occupancy, which are indispensable for tracking performance and making informed future investment decisions. Regular, transparent communication will keep you well-informed about your property’s status and management activities.

Fees and Contract Terms

Understand all the costs associated with the management of your property, including fixed management fees, variable costs like leasing commissions, and any additional charges for services like advertising vacant spaces. Scrutinize the management contract for terms related to the duration of the service, renewal clauses, and termination conditions to be sure they are reasonable and offer flexibility.

How can I find commercial property managers near me?

Most property owners interview several commercial property managers before making a final decision about which company to hire. All Property Management has an extensive network of qualified commercial management companies to choose from along with helpful learning resources to get the best results for your specific needs.

Use our database to find commercial property management companies who manage real estate in your area, then get in touch with the companies that interest you by filling out requests for free quotes. No matter the size of your business, we have companies that can work with you to maximize the profitability of your properties.

Begin your research and find the right commercial real estate property management company today with our helpful search tool.