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Property Management Question

MAT3Sigma
2007-11-28 14:07

Hi!
This is a wonderful site! I've spent a lot of time just reading the forums and finding answers to many questions I have had.
I'm contemplating building a small retail center. I understand the leasing agent can get 5-6% commission on the total leases. How much does the property manager get?
I understand for NNN, the tenants pay for the property manager. Does the property manager mainly take care of landscaping, shell, snow removal, etc?
Thanks in Advance-


MAT3Sigma
2007-12-03 10:58

Remember- I'm a newbie. I'm hoping you experts out there can shed some light-
I once had a property manager tell me not to pay too much leasing commission or they wouldn't be anything left for their property managment. Or do I need one at all for NNN? (The property is located some distance away)
Ann


larock
2007-12-04 20:11

I don't normally use a property manager for commerical properties. In most cases the tenants are responsible for their utilities and interior maintenance, so that eliminates phone calls for those items. Then, I contract out the lawn care, snow removal, parking lot maintenance, etc. If the tenants have a problem, they can contact your leasing agent or you directly. If you are convinced you need or want a property manager a true NNN lease would have the expense billed to the tenant. However, most propective tenants may think the additional cost a little hard to swallow.


MAT3Sigma
2007-12-05 12:49




Quote:

On 2007-12-04 20:11, larock wrote:
I don't normally use a property manager for commerical properties. In most cases the tenants are responsible for their utilities and interior maintenance, so that eliminates phone calls for those items. Then, I contract out the lawn care, snow removal, parking lot maintenance, etc. If the tenants have a problem, they can contact your leasing agent or you directly. If you are convinced you need or want a property manager a true NNN lease would have the expense billed to the tenant. However, most propective tenants may think the additional cost a little hard to swallow.



Hey -thanks for the response. We've just done residential in the past- which was remotely located so have been forced to have property managers.

With doing it yourself I guess you receive the lease payment checks yourself and have to deal with late payments & evictions yourself. Guess you have to make sure the lease is strongly written-
It sounds like the leasing agent helps out to some extent, too.

I do have a good bookkeeper(we're very small), so the overhead shouldn't be too burdensome-

Thanks again
Ann
3 Sigma Corp.


Jess3414
2007-12-18 16:39

I am a commercial property manager for several NNN properties. The way it works is as follows:

The developer or property owner hire the management company and pay the manager 4% (in my case - this is all negotiated in the management agreement) of the total monthly rent and CAM income on the property. This fee is usually paid by the owner, out of his or her cashflow and is a benefit to them because the property manager is the responsible for EVERYTHING on the property. The owner then steps back and the Tenants direct any and all issues through the property manager. I am responsible for contracting out and setting up everything on the property (including, trash, utilities, maintenance, signage, marketing etc.) and everything I do gets approval by the owner. I also furnish the owner with reports monthly for cashflow, expenses, budgets, etc. Basically I relieve the owner of any day to day responsibility on a project. I would only recommend hiring a property manager though if you have a fairly large property that is a lot to handle or if you have more than one property to worry about and can't handle it all yourself or through your staff.

I hope I didn't confuse you! Let me know if you have anymore questions based on what I have said here!


MAT3Sigma
2007-12-31 14:09




Quote:

On 2007-12-18 16:39, Jess3414 wrote:
I am a commercial property manager for several NNN properties. The way it works is as follows:

The developer or property owner hire the management company and pay the manager 4% (in my case - this is all negotiated in the management agreement) of the total monthly rent and CAM income on the property. This fee is usually paid by the owner, out of his or her cashflow and is a benefit to them because the property manager is the responsible for EVERYTHING on the property. The owner then steps back and the Tenants direct any and all issues through the property manager. I am responsible for contracting out and setting up everything on the property (including, trash, utilities, maintenance, signage, marketing etc.) and everything I do gets approval by the owner. I also furnish the owner with reports monthly for cashflow, expenses, budgets, etc. Basically I relieve the owner of any day to day responsibility on a project. I would only recommend hiring a property manager though if you have a fairly large property that is a lot to handle or if you have more than one property to worry about and can't handle it all yourself or through your staff.

I hope I didn't confuse you! Let me know if you have anymore questions based on what I have said here!





Thanks for the input- In our case there would probably be only 4 tenants, at least in the first year or so & the realtor would be securing the initial leases-


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