PROPERTY: Changing Face Of Property Management
Recent Western Cape Business News
The increased vacancies and debtors of the last few years has resulted in asset managers and property managers working more closely together to not only ensure that the day to day cash flow of properties is protected but also to look for income adding opportunities of strategic value for clients’ properties and portfolios.
This is according to Marc Edwards, the Managing Director of Spire Property Management. “There used to be a distinct line separating the role of asset manager and property manager in the past. Spire has seen this divide being narrowed of late and in some cases being blurred all together and we believe this is a good thing. A close working relationship between an asset manager (employed by the landlord) and the property manager ensures that the properties operational and strategic considerations are taken into account when making day to day decisions.”
“Good property management is no longer just about the basics, such as making sure tenants pay their rent - property managers need to also be involved in traditional asset management functions such as income and expenditure benchmarking, financial analysis, tenant mix strategy and optimisation, refurbishment and re-development opportunities and adopting sustainable “green” strategies to name a few,” says Edwards. “The property manager, with their “on the ground” operational exposure can ensure property strategies are relevant and value enhancing.”
“Property managers are exposed to property at the coal face. As a result, they are presented with numerous opportunities for their clients which they need to be aware of. A close working relationship with the clients asset manager ensures that these deals are not lost.”
Edwards advises that the traditional property management fee, which is generally charged on a “cash collected” basis, does not cover these additional services and managers should highlight these to their clients. “Additional fees should be agreed where property value is enhanced by the property managers. There are many ways to do this which result in a win-win for both client and property manager.”
According to Edwards, Spire Property Management has ensured that they offer such strategic services to their clients and subsequently the company is growing strongly on a national level – proof that niche, hands on property management can lead to success, even in recessionary conditions.
In the past 12 months Spire has secured a number of new, national property management contracts – a total of approximately 311 000 square metres of additional space. The majority of these contracts come from the listed property sector.
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