Once bitten, twice shy as the old saying goes. If you’ve had a bad experience with a management agency overseeing your commercial property, you’d be forgiven for being somewhat sceptical when it comes to engaging with another agency. After all, it can be difficult to trust again when your investment is on the line.
Unfortunately, this is something I’m seeing more and more of: people let down by their management agencies are instead swearing off using them, attempting to do it alone, building an internal team to address their property’s needs, or simply selling up instead. This can obviously be a costly scenario, when it needn’t be the case.
What Bad Experiences Are Landlords Facing?
To understand why landlords are choosing these options, it’s important to first understand the circumstances which led them to feel disappointed and disenfranchised.
In many cases, it can be how small issues snowball into costly challenges. Without proper management – including regular site visits and a strong rapport with tenants – small problems can quickly balloon.
What was one day just a bad decision by a tenant, such as leaving wooden pallets in the yard, can in no time at all become a headache. In this particular example, the pallets constitute a fire hazard, and can see the landlord’s fire insurance coverage at risk.
It’s not just the cost of mistakes, repairs and fines that landlords are finding challenging, either. Late payments by tenants can be highly problematic, and if an agency doesn’t maintain a good relationship or manage the income properly, landlords can end up out of pocket – and sometimes their only solution is to sell up.
In recent months, we’ve been offering our clients an additional service whereby old commercial debt is recovered. Our conversations with clients in this area have highlighted a clear problem whereby agencies are taking actions which exclude landlords from getting their money back. For example, where a client hasn’t paid and an agency changes the locks on the building, they’ve negated the contract by kicking the tenant out – making the process of recovering the debt so much more difficult.
Don’t Give Up Hope
Despite these bad experiences, there are many reasons for commercial property landlords to not give up:
In short, although you may not have had the best experience with a commercial property management company in the past, don’t let it define a difficult future for you and your investment. Draw up some criteria from that experience and go in search of an agency which will be all too happy to keep your tenants happy, make sure your pockets are lined, and help your investment to thrive.