Whether new to commercial real estate ownership or a veteran, these tips could prevent major headaches down the road…
Commercial real estate is complex puzzle.
From the early stages of the property search and negotiations to securing quality tenants, commercial real estate is not for the faint-of-heart. You need to be savvy, detail oriented, tough, fair and have an uncanny ability to deal with the unexpected as a routine part of daily life.
There are many pieces and the picture you’re trying to construct seems to always be changing.
Whether you are a proud new owner of a shiny office building, or a veteran that has been in the commercial real estate trenches for decades, staying educated and on top-of-your game is critical to achieving the goals you’ve set for your real estate assets.
MacRo’s here to help you remain vigilant when it comes to continuing to hone your commercial real estate ownership chops. Remembering our top five tips for developing and protecting your commercial real estate assets is sure to come in handy during your landlord adventures.
Keep Learning. Always.
Don’t rest on your laurels. Constantly better yourself through seminars, podcasts, books and whatever other resources you can get your hands on. Talk to other building owners about their experiences and how they’ve handled difficult situations.
You don’t have to be on an island.
Get involved with the local commercial property owner community. It’s crucial that you never stop learning about the field, whether that is keeping pace with the latest technology, newly passed laws or brushing up on your do-it-yourself office repair skills.
Stick to Your Guns
Develop a clear policy for your tenants to follow and enforce it consistently and objectively.
If you’ve set a late charge deadline and a tenant misses it, charge the late fee regardless of how the tenant might plead innocence or hardship. And apply that objectivity to all of your tenants, if you have more than one.
By developing clear policies and enforcing them immediately and universally, your tenants will eventually appreciate your transparency and follow through, which lets them know where they stand and what the consequences are for not fulfilling their tenant obligations.
But policy enforcement will only go so far without building trust with your tenant or tenants—they will tend to follow your policy more readily if they trust that you will provide great service and do what you say you are going to do. It’s a two way street and both lanes need to stay clear of obstacles.
Set Clear Boundaries.
Protect your time right from the start. Getting calls at 10:30 at night to fix a toilet is not why you invested in this property, right?
Oh, you’ll have toilets and sinks and many other items to fix, but try to make sure that requests for service happen within a framework that you dictate.
When taking on a tenant or tenants, provide clear direction on acceptable office hours and when you are available. Remember, you are the boss. You set the hours. Now, there will be times when you’ll have to plug a leaking pipe at 2 a.m., but that should always be the exception if you’ve laid things out correctly right from the start.
Know When to Get Help.
Know thyself. Have an unfiltered and objective understanding of what you can and can’t do when it comes to making repairs or improvements to your property.
Remember, your time is valuable. You need to protect it. Even if you believe you can fix anything and everything, you probably shouldn’t. Knowing when to call the pros and when a situation fits for the best of your do-it-yourself handyman skills is important for you, your tenant and the health and longevity of your commercial real estate assets.
Keep these four tips in mind as you manage your commercial property and your tenant or tenants. By establishing rules, sticking to them and having the self-awareness to do some work and outsource the rest, you will go a long way to enjoying your role as owner and creating loyal, happy tenants that pay their rent on time.
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Rocky Mackintosh, the Founder and President of MacRo, Ltd., is a leading commercial real estate expert in the region.He has been an active member of the Frederick, Maryland community for over four decades. He has served as chairman of the board of Frederick Memorial Hospital and as a member of the Frederick County Charter Board from 2010 to 2012.