For those of you that are new to office building management or property management, for the most part, property management services are performed by professionals that do not own the property. Typically they are provided the authority to represent the principals or owners, sometimes referred to as 3rd party management.  The fiduciary relationship of the agent creates legal and ethical responsibilities to achieve the owner’s objectives. Depending on the marketplace, a management fee is paid to the 3rd party managing agent and these fees can range depending on many different factors.

For example, a commercial office building of 20,000 square feet that generates $20 a square foot or $400,000 annually might negotiate a management fee of 5%.

But a 300,000 square foot building that generates $50 per square foot or $15,000,000 annually might generate 2 to 3% management fees or $450k annually.  There are many things to consider and it really comes down to what the market will bear.

Property Manager Job Description

Although responsibilities vary from property to property, there are specific tasks that are general in nature to all properties, large and small. The principal duties and responsibilities of a commercial property manager includes creating a income and operating expense budget; establishing building rules, policies and procedures; estimating operating expenses on a monthly basis; hiring personnel and selecting contract services to maintain the property; handling accounts payable; lease administration duties; tenant retention programs and administration of risk management programs. The property manager may also oversee and coordinate tenant improvements, specific building improvements such as replacing the roof or repaving the parking area or performing concrete deck repairs in an underground parking garage. The property manager is generally involved in the leasing process in some form although a separate agreement is typically entered into between the property owners and leasing broker. There are many other responsibilities not listed in this article as I am only trying to reflect some of the more pertinent responsibilities.

Qualifications

Qualifications of a property manager also vary depending on the real estate market and type of property. It would be  prudent to attain a real estate management designation such as the certified property manager designation sponsored by International Real Estate Management (IREM) or Real Property Administration (RPA) sponsored by the Building Owners and Managers Association (BOMA). Some firms require a college degree and some look at each candidate and their education separately to make a determination of their employment. There are also several universities offering property management or real estate management courses and may also be available on-line. You can get more information about these designations on the internet by going to www.irem.org or www.boma.org.

Get Information Pertaining to Salaries & Wages Here.

Wages for commercial property managers very significantly depending on the location, type of property and most importantly, responsibilities. I don’t know if this holds trues in all markets but there is a difference between suburban properties and downtown urban centers in the areas I am familiar with which is the the Washington, DC and metropolitan areas including Baltimore and northern Virginia.

There you will find that an experienced commercial property manager managing one medium sized (250k SF) property with annual wages ranging from $75k-$90k.

If you were to take the same property along with the same responsibilities, and relocate them to the suburban areas outside the city, annual wages could vary by as much as 10% if not more. Also, wages vary greatly throughout the country.

At the time of this writing (Mar-2010) the economy has just come out of a recession but the real estate industry as a whole has suffered losses in asset value and lower rents. Tenants are able to get generous concessions from rent abatement to above standard tenant improvements. This along with the unemployment rate at more than 10% changes people’s mindset and most are just happy to be employed. More about the economy, property values and the real estate market will be discussed in future articles.