When entering the commercial real estate market, owning a property is as much about the people as it is about the building. Tenants, just like the property itself, have needs. The two have a direct relationship: Ignore the property, and tenants leave. Ignore the tenants, and the property suffers.
The combination of a well-managed property and strong people skills not only strengthens the tenant/owner relationship, it also raises the value of the asset. In other words, a happy building is a happy tenant, and a happy tenant is a profitable investment.
First and foremost, it’s important to take stock of the property itself with regular inspections. Be aware of any property needs that may need attention, such as air conditioning, plumbing, pest control, and safety issues. If there is any work that needs to be done, know the contractors who will be doing the work. While they’re working in and around the property, they are a direct reflection on you.
At the same time, it’s important to not take the building’s appearance for granted. Consider the curb appeal of the property, as well as what’s on the inside. Adding or improving landscaping in addition to offering amenities like high-speed Internet service or Wi-Fi can go a long way in not only attracting the right tenants, but also convincing good tenants to stay rather than relocate.
When it comes to keeping tenants happy, communication is key. The biggest complaints from unhappy tenants are usually poor communication and any misunderstanding of terms. To address this, it’s important to:
While it’s impossible to prepare for every issue, it’s always a good idea to address problems before they become a crisis. Being proactive will alleviate many of the headaches associated with owning a commercial property.
If the management of your property is too large of a task, surround yourself with good people who can represent you and your vision professionally. Anything you can do to add value to your asset is a win for you and your investment. The property management team at Morris Southeast Group has a history of adding value to office, industrial, flex/warehouse, and retail properties.
For a free consultation or to learn more about our property management services, call Morris Southeast Group at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at email@example.com.
When the housing market collapsed, investors of all sizes swooped in to buy up residential properties to grow wealth and expand portfolios. What is often overlooked, though, is another real estate investment opportunity that often stays comparatively stable during swings in the economy: commercial real estate (CRE).
Diversifying into the CRE market is vastly different than investing in residential, and investors new to CRE should dip their toes in slowly and cautiously.
Most residential investors are familiar with the ins and outs of single-family homes, duplexes and triplexes, and even small apartment buildings. CRE investments operate on a whole new set of metrics and complexities – and a new investor needs to answer a few key questions before jumping in:
There are a host of unique benefits from commercial opportunities. Topping nearly every list is the reason why so many turn to the CRE market: higher yields. Generally speaking, commercial tenants assume many more costs (such as insurance and maintenance) than landlords do for residential properties.
Additional positives include:
Despite the positives, there are complexities woven throughout CRE investment – and failing to deal with each one usually comes down to a single mistake: the investor not doing his or her homework.
Many new-to-CRE investors falsely believe that commercial properties won’t go into foreclosure, and failure to do proper research can lead many investors down that path. Consider the following before taking the leap:
Of course, the best way to face many of these issues is to talk to someone who is well-versed in CRE and the area you’ve chosen. The professionals at Morris Southeast Group have decades of experience in helping commercial investors in South Florida and beyond, and we help match a new investor with the best opportunities.
For a free consultation on CRE or to learn more about our property management services, call Morris Southeast Group at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at firstname.lastname@example.org.