The goal of becoming a commercial real estate investor is to amass a significant portfolio that generates consistent income. The tricky part is managing all of those properties, and doing so well enough to draw tenants in and keep them happy. Commercial real estate is not a passive investment, and the more properties you own, the more time-intensive it becomes.
The solution for many investors is to work with a real estate management company. However, as with all steps of the investment process, you need to choose carefully. Here are some tips on how to evaluate a real estate management company.
Ask Them About Their Property to Manager Ratio
Property management companies are a business, and as such, they need to make a profit. Some companies do this by overloading their property managers with work, assigning them more properties than they can effectively manage. You want to select a company that can give your properties the focus they need, so look for those who give their managers a reasonable workload.
Have Them Explain Their Rental Rate Strategy
Setting rent for your property is one of the hardest and most important decisions to make. When you hire someone to handle this for you, you need to know how they are going to come up with the right number for you. Ask them to explain the strategy they use and give some examples of properties they have recently priced so you can be comfortable with their method.
Go Over Their Tenant Screening Process
When you rent to someone, you want them to be the best possible tenant for your property. Property management companies are supposed to thoroughly vet all potential tenants and then rent to the best candidate. However, how do they determine who is suited to your property and who is not? Go over their process in full, and make sure it's thorough and something you feel comfortable with.
Find Out How They Interact With Tenants
Your property management company needs to be a good fit for you, but if you are going to keep tenants happy—and keep your occupancy rates high—they also need to be good at interacting with tenants. Find out not just the services they offer—rent collection, maintenance, etc.—but precisely how they approach communication with tenants. You want a dynamic that is friendly enough to be accessible but authoritative enough to get results when needed.
By following these tips, you should be able to determine how suited a real estate management company is to work with you. Or, better yet, rely on the help of MGR. We’ll be delighted to put our decades of experience to work for you.
At MGR Property Management, we believe hiring a property management company should provide such a quick turn around on your investment, that it should practically feel free. By managing properties well and pricing them at competitive rates, you will see nearly instantaneous results. Read Your Property Management Company Should Pay for Itself