WHY PROPERTY MANAGEMENT IS THE BEDROCK OF THE INDUSTRY
22 February 2016Property/asset management has traditionally been seen as the “Cinderella” of the property industry. Upon graduating, young surveyors dream of carrying out big agency transactions such as letting or selling shops and offices or engaging in the close combat of rent review or expert witness work. Property management is more traditionally regarded as the area of fusty leases and blocked drains. However there is no doubt that proper professional property management forms a vital part of the property industry.
If you think of the property industry as a building, the asset management is the foundation upon which the superstructure is constructed. Whilst the superstructure itself is highly visible and within the consciousness of the observer, property management is actually the sub-structure upon which this “building” is constructed. However no building will be able to function without a good, well-designed base. This is why asset management is so important because in many respects it is the foundation upon which the industry is built.
For example, asset management involves issues such as rent collection, service charge apportionment and collection, insuring buildings, dealing with repairs, dealing with disputes, and most importantly, mapping out a future strategy in order to achieve the optimum value for the asset. Whilst certain areas of the property industry are in response to events such as valuations because the bank requires it, disposal or acquisition because that is what the client wants, asset management is more cerebral in that it is geared to the maintenance of the asset and setting out a path for its future increased value thereby maximising its worth for the beneficiary.
These beneficiaries may be many and varied. Many asset owners are developers, speculators, investors, but others may be pensioners who will be reliant on their property for their income into their twilight years.
The quality of the property management advice is very important. All too frequently investors take asset management advice from the cheapest source. However that can be a mistake.
Asset management is a technically diverse area dealing with construction issues, maintenance repairs, planning, business tenancies, rent reviews, lease renewals, accounts, insurance and overall strategic planning. So asset managers need the technical knowledge on how to deal with a myriad of diverse but exciting issues.
Therefore engaging the services of a well-respected experienced firm of asset managers can be money well spent and saves the owner not just money but also anguish and hassle.
It is for these reasons therefore that asset management, whilst it operates in the background, is very important for many property owners particularly those who are reliant on rental income for their winter weeks away from the latest Storm Henry. When somebody says that property/asset management is dreary and unexciting it should be remembered that it is a mainstay of the profession and an excellent source of revenue for commercial property businesses when the higher profile parts of the industry are in a down cycle. Frank Cassidy may be contacted on 028 90270000 or at frank.cassidy@osborne king.com