Investing in commercial real estate offers the potential for significant returns, but managing a commercial property requires a substantial amount of time, effort, and expertise. Hiring a property management company can be a smart solution, but sometimes finding a competent property manager can sometimes feel harder than finding true love.
So, what’s a commercial landlord to do? Start by considering these ten key factors when selecting a commercial property management company:
1. Do they practice proactive, scheduled property maintenance?
Regular maintenance is crucial for preserving property value and ensuring tenant satisfaction, which directly impacts your income. Ask to review a sample maintenance schedule and records from one of their managed properties. Does their plan include routine inspections, timely repairs, and necessary upgrades? Do they promptly address maintenance concerns to prevent minor issues from escalating into costly problems?
2. Do they thoroughly screen tenants?
Effective property management starts with selecting the right tenants. A rigorous screening process helps prevent future issues. Does the management company check financial backgrounds, rental histories, and business credentials? Do they provide clearly written lease agreements and tenant guidelines to set expectations and mitigate conflicts?
3. Do they follow best practices for financial management?
Understanding how a company handles finances is critical. Ask about the types and frequency of financial statements you’ll receive. Do they send monthly or quarterly reports? Do they maintain an escrow account for security deposits? How and when do they distribute profits to landlords? What documentation will you receive at tax time? Do they have an in-house accountant, or do they outsource financial management?
4. Do they maintain regular communication with tenants?
Strong tenant relationships lead to higher retention rates. Ask about their communication practices. What is their average response time for maintenance requests? Can they provide examples of property-wide communications?
5. How do they ensure legal compliance?
Staying compliant with local, state, and federal regulations is essential. How does the company stay updated on changing laws? What are their eviction policies and procedures? Do they have access to an experienced real estate attorney to consult when needed?
6. What are their emergency preparedness plans?
Hurricanes and severe weather are a reality on the Gulf Coast. Does the management company have a plan for handling natural disasters, fires, or security breaches? How do they ensure tenants are aware of emergency procedures? What steps do they take to protect your property when storms are approaching?
7. How do they market vacant properties?
Vacancies reduce profitability, so effective marketing is essential. Does the company have a strong local business network? Do they utilize online listing platforms and social media to attract tenants?
8. How close are they to your property?
Proximity matters in property management. If your property is more than two to three hours from their office, what systems do they have in place to ensure regular site visits and tenant communication? Do they have experience managing properties in your area? Do they have a network of reliable vendors nearby?
9. How do they plan for growth and scalability?
A growing property management company must be able to scale its operations effectively. How many employees do they have? Is employee turnover high? Do they have a plan for sustainable growth to ensure they continue providing excellent service?
10. Will they provide references?
A reputable property management company should be able to provide references from both property owners and tenants. Ask for a list of current clients who can speak to their experience. Are property owners satisfied with their financial reporting, maintenance, and tenant relations? Do tenants feel heard and supported? First-hand accounts can give you valuable insight into how the company truly operates.
White-Spunner Realty has been successfully managing commercial properties along the Gulf Coast for decades, and many of our landlords are long-term, satisfied clients. Our 90% tenancy rate speaks to our great working relationship with many long-term tenants as well. If you’re looking for a commercial property manager in Mobile, Baldwin or along the Gulf Coast, White-Spunner Realty should be your first call!
