Notes

Commercial Property Agents - What Are Your Property Management Fees Today?
A property agent that is to get owning a commercial or retail property should cover operational costs and make up a profit. That is in which the fees charged are very important. It might sound a little crazy, but some agencies never make money from commercial or retail property management; that is because they cannot know what they are really being doing and don't setup the systems to support the special skill sets. Commercial or retail property management is very special; be simple rules of residential real estate property don't apply.
Many real-estate agencies also can regard the property management service at the office because the 'poor cousin' towards the sales and leasing division. Whilst that concept may operate in residential property management, exactly the same won't apply in and with commercial or retail property. Commercial and retail property management is merely far too specialised and sophisticated to be a 'poor cousin' to anything.
If you have a real estate property agency and even take up a commercial property management division, then allow me to share the fundamental rules:


Employ good people for that commercial and retail services you happen to be to provide. They need intelligence and drive to specialise.

Gather the commercial and retail market knowledge and trends which means you know what is required to create your division and business.

Make sure everyone that you apply on commercial or retail property really understands what these are doing, and get them taught to pick up on any shortcomings.

Charge reasonable fees which are reflecting the complex and special tasks of the property management job


So what are fees for managing commercial or retail property today? To answer the question you need to first discover what other agents are charging locally for your management services. You will soon see those that are 'cheap' making use of their fees; the truth is that they do not take the tasks of the job seriously. Low fees don't apply if you happen to be a serious and professional commercial agent. In praoclaiming that, it is vital to supply excellent services to the clients which you serve to justify your fee.
Here are a few fees to think about in providing your home management services to commercial and retail property:


A base management fee should be set for managing the property on a everyday basis. That will include rent collection, income and expenditure management, tenant and lease management, and maintenance management. You should also include an allocation of time for reporting to and talking with all of the tenants and the landlord, due to the demands and operation of the house.

A fee must be set for negotiating the many forms of lease rent reviews when and when they fall due. Given that the rent comments are of types, it's good setting fees for each type. Market rent comments are essentially the most time intensive and may attract the higher fees.

A fee for negotiating new leases and renewals of leases with sitting tenants ought to be set. It is common to negotiate leases with your sitting tenants.

New leases with businesses wanting to occupy your vacant space in the house will even attract its own fee. This is going to be above the fees that you set with your sitting tenants, as increasing numbers of work is required.

Set useful source for special tasks which are outside normal management duties. This can be away from hour's property attendance, court attendance, project management, and business planning or budgeting of the house once each year.


As an over-all observation, retail property is a lot more demanding on the house manager's time in the nature from the tenancy mix along with the operations of the house. Take care when setting a fee for the retail property management and present due regard to your office and staff costs.
So how much profit should you make in running your commercial or retail property management division? The answer is about 30% to 40% on top of your gross operational costs of running the division. When you know this number, setting another fees is not a problem.
There could be other fees for you to consider in addition for the main ones above, so be aware of what the home needs in daily management, and exactly what the local property market is doing. Do not discount your house management fees to win the business; a quality service uses a fair and reasonable fee.
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