Transcript Document
Property Management
Overview
Property managers have three major
responsibilities:
financial management
physical management
administrative management
What do you think the primary differences
would be between residential property
management and commercial property
management?
A growing source of employment are
homeowners’ associations and PUD’s.
The Management Agreement
The property manager is usually a general
agent of the client.
The agreement should cover:
description of the property
time period the agreement covers
description of manager’s responsibilities
statement of owner’s purpose
extent of manager’s authority
extent of reporting required
compensation of management
allocation of management costs between
manager and owner
equal opportunity statement (protects both
manager and owner)
Management Functions
Budgeting expenses
fixed operating expenses
variable operating expenses
cash reserve fund
any desired capital expenditures
Renting the property
the property manager does not necessarily
act as the leasing agent and may have
different goals than a straight leasing agent.
Rental income must:
cover fixed charges and expenses
provide a fair return to the owner
must be competitive
A primary indicator of property health is
the vacancy rate. Too high or too low
could indicate a problem.
Selecting Tenants
It is crucial that new tenants be
compatible with existing tenants!
Tenants have to be creditworthy
What are some ways to maintain good
relations with tenants?
What might happen if you are too lenient
on tenants that don’t pay on time or who
break other rules?
Maintain the property
Maintain the property
Maintain the property
preventive
repair or corrective
routine
construction – primarily for new tenants
Americans with Disabilities Act
The law recommends the owners of
existing buildings to make reasonably
achievable accommodations to provide
access to facilities and services.
Existing barriers must be removed when
this can be accomplished in a readily
achievable manner.
See book for most common modifications.
Risk Management
Four choices:
avoid it
control it
transfer it
retain it
Types of insurance:
fire and hazard
business interruption
contents and personal property
liability
liability
liability
worker’s
compensation insurance
casualty (theft, vandalism, etc.)
surety bonds