Property management - our management concept
The starting point
- Since many services are now rendered on a decentralised basis (rather than centrally by local administrators), large property management firms operate through numerous inferfaces. As a result, administrators are no longer solely responsible for traditional activities from A-Z; directly monitoring of working processes is less feasible and processing delays are possible.
- In many instances, quality and expertise levels offered by the various branch offices cannot match those of smaller, owner-operated management firms.
- Many large property management firms operate in a radius of as much as 200km, in some cases delivering on-site support through caretakers. Since proximity to the tenant can be inadequate, measures necessary to reduce fluctuation on the part of the administrator may be inconspicuous and scope for local claims management activity, to give one example, may be limited.
- Given an extensive business relationship, poor property managment performance often makes it difficult to claim financial compensation without putting the whole contract scenario at risk in cases of liability.
Objective and basic concept
- Optimisation of management
- Central portfolio management division shares business address with asset management
- Overall responsibility for administering all properties in the portfolio
- Central control of lettings
- Central control of all cash flows
- Integration of local property management firms as landlords, site managers and technicians
- Provision of on-site property support through local property managers
One way of optimising property portfolio management over the long term (as regards the key factors of local support, response times, processing times, quality, monitoring and scope for intervention) is to bring about a competitive situation. A central portfolio management division was therefore set up to operate nationally while incorporating local property management companies.
Central portfolio management shares a business address with members of asset management to ensure continual and fast exchanges between the divisions (also supported by a direct link to the ERP programme).
Within the central portfolio management set-up, the property manager bears overall responsibility for managing all properties in the portfolio; in a large portfolio, the managing director will be responsible for the property managers, who in turn oversee individual properties through third-party local property management firms, site managers and technicians.
The divisions of finance (which monitors all cash flows within the administration management analyses, evaluations and so on), debtor management, legal affairs, utility billing and central lettings control are also under the direct control of the managing director. To ensure control of finances, all rental revenue is paid directly into head office accounts, with the payment of operating expenses and other administrative costs managed from there.
Local property managers are then contractually bound to oversee properties on site, thus ensuring properties are serviced and tenants are locally supported.