How to Manage Commercial Properties: Finding Tenants and Buyers
Commercial Property Marketing
Knowing how to effectively market a commercial property is crucially important since vacancies mean less rental income for the property owner. The last thing any owner wants is to earn less than what it costs to maintain the property each month. The whole point of investing in a property to is to earn a profit.
There are basically three ways to find potential renters and/or buyers:
- Property owner handles marketing
- Property manager or management company handles marketing
- Real estate broker handles marketing
Do I need a broker?
A real estate broker helps clients buy, sell, or rent properties. If the property is run by a property manager or management company, a broker may not be needed since many managers can find tenants and potential buyers without the assistance of a broker. However, if the property is owner-managed, it may be necessary to hire a broker who works in or around the area where the property is located. The best practice is to utilize all three of the methods described above. The property owner, manager, and broker should all actively market the property for new tenants when there is a vacancy or when the property is for sale.
How can I attract potential tenants and buyers?
- Signage: Aesthetically pleasing signs that are well-maintained can be a major selling point when attracting both tenants and buyers. Business owners seeking to rent a space will want to make sure that their customers or clients will be able to find their place of business. For example, retail store owners will probably want their store signs to be visible from the street. Conversely, people interested in leasing an office space may want the name of their business to be listed in a building directory or displayed on an outdoor marquee.
- Parking: Whether a property has adequate parking is a key factor in a tenant’s decision to rent a commercial space. It will be difficult to attract new tenants if there are an insufficient number of parking spaces or if the parking lot is in disrepair (potholes, loose gravel, unpaved, ect.). The best practice is to always keep the parking area free of trash and debris, and if need be, re-pave the parking lot, re-paint the parking spot lines, and add more parking. If there aren't enough parking spots, you can either purchase or lease land adjacent to the property to use as additional parking, or you can rent to tenants who have different hours of operation to avoid overcrowding.
- Security: Having a safe premises is another great way to attract tenants and buyers. People will want to know the property and its’ visitors are safe before committing to a lease or sale. Maintaining safety can be done by employing security measures that are appropriate for the property based on the type and location of the building. The most common measures include installing a security alarm, installing security cameras, and hiring a security guard. In addition, a well-lit parking area is a simple and inexpensive way to put the tenants’ minds at ease.
Exterior façade and landscaping: The exterior of the building and its surrounding area are the first thing prospective tenants and buyers see. To make a good and lasting first impression you should maintain the lawn, regularly landscape, clean any exterior windows, and power wash the building façade when need be. For older properties, you may need to re-paint the exterior and fix cracks in the building walls or columns. Beautifying the exterior makes the property more atheistically pleasing thereby attracting prospective tenants and buyers.
The information in this article is for general information purposes only. Nothing on this or associated pages, comments, answers, or other communications should be taken as legal advice. The information provided is not intended to create, and viewing of this information does not constitute, an attorney-client relationship.