Making Places Better...One Building at a Time

Leaping Tall Buildings at a Single Bound | September 7, 2010

One of my favorite business pastimes is perusing industry magazines for “buzz” or the latest talk around the virtual water cooler of the real estate business.  In this month’s “Commercial Real Estate Network” magazine is an article for Property Managers, so it caught my attention.

Check out the skill level implied by this excerpt:  “Managers who are able to effectively negotiate contracts, control operations and reduce costs while maintaining tenant satisfaction, and advising owners on effective hold strategies will earn more business.”  I wholeheartedly agree with that statement.  The question is, how exactly does a Property Manager get those impressive credentials?  The article answers it nicely…by becoming a member of BOMA and taking advantage of all the learning opportunities.

In my humble opinion, however, it takes more than that.  It takes exposure to the ownership side of the equation.  Because that is where the real world of this kind of experience is gained.

Take the first part of the statement:  negotiating effective contracts.  In two areas of purchasing, property insurance and electricity buying, we have bundled all (or as many as possible) of our properties together to bid and negotiate the cost, and the process has indeed given us a number of advantages, in lowering costs, keeping increases to a minimum, and providing leverage we didn’t have before.  Here is the rub though–we had our “Owner” hat on when we instigated each process.  Had we been Property Managers only, we would have looked at each building as separate entities, and maybe not as a portfolio.  With a critical mass of properties in our portfolio that are owned by in-house partnerships, we take on the extra work (and it is extra work, believe me), and get the experience that allows us to “advise owners on effective hold strategies.”

In short, you have to know what you’re talking about, and walking in the shoes of the owner is the best way to get there.

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