But all those buildings do not manage themselves, and there are solid, meaningful livelihoods to be made in managing commercial properties.
The pay of such manager positions varies of course, but salaries well above $50,000 are common, and above $70,000 in large cities. Moreover, while it helps to have a college degree to get started, it is not necessary.
For many, there is an additional bonus: The ideal commercial property manager is most of all reliable and responsible, but then also strong in communications skills, customer service, and personal relations. These are valuable attributes in anybody, but not beyond reach for most willing to dedicate themselves to a profession of operating commercial buildings.
That being said, the emergence of new internet-connected software to help manage buildings is increasing demand for IT-savvy people in the industry. Moreover, the property management workforce is known to be aging, and building owners in recent years have complained about manager shortages.
A commercial property manager generally oversees non-residential properties such as offices, retail spaces, storage facilities, shopping centers and industrial buildings.
The duties of a commercial building manager vary depending on the size and type of property, but some basics apply.
In general, a building manager is in charge of marketing vacancies, finding worthy tenants, collecting rent, scheduling repairs, and overseeing day-to-day maintenance operations, such as janitorial, landscaping, parking and security issues. In larger complexes, some of these tasks may be split among managers, or in smaller buildings the manager may become a jack-of-all-trades. Meticulous record-keeping is essential.
In modernized property-management settings, building management will utilize online software to monitor energy and water use, building security and even interior air-quality and other building metrics. A building website may be maintained, to market the structure and enhance the building’s image. The building manager may be in charge of neighborhood relations.
And one more, and most-important duty for a building manager: Keeping building ownership apprised, and when possible, forewarned regarding vacancies in, and physical conditions of, the property in question.
For better or worse, there is a bit of “credentialism” in every profession, and that includes commercial property management. Most states do require a real estate brokers license to become a commercial property manager. Beyond that, there are certifications and courses for commercial property managers (which will discussed later), but which are not required by law.
After getting a real estate license, starting out to actually become a commercial property manager will be a challenge, as it is for anyone wanting to crack into a new business or trade. Checking the online classified job-site ads is the obvious first step. Commercial property job-hunters may find that having a bachelor’s degree helps in the job search, but junior positions may be available in some larger locations or at smaller buildings.
It may also be wise to seek a job as an assistant to a commercial property manager, as a first step. This will assist in developing contacts, and also may also confirm one’s desire to enter the profession.
The National Association of Property Managers (NARPM) has job listings as well.
In addition to working directly for a building owner, there are commercial property management companies in most major cities, that manage properties for many clients, who also may be looking for employees.
One indicator of the increasing sophistication of the commercial property management trade is the emergence of commercial (and residential) property management certificate courses.
There are two main commercial property management certification courses in the U.S.; one is operated by the The Institute of Real Estate Management, and the other by The Building Owners and Managers Association International. Courses and certifications are available online.
The Institute of Real Estate Management (IREM) offers four types of property management certifications:
Certified Property Manager (CPM) is the standard certification.
Accredited Residential Manager (ARM) is for residential property managers.
Accredited Commercial Manager (ACoM) is for commercial property managers.
Accredited Management Organization (AMO) is for real estate management firms.
The Building Owners and Managers Association International (BOMA) serves the commercial property industry and they offer one primary certification:
Certified Manager of Commercial Properties (CMCP), intended for for commercial property managers in the early stages of their real estate career.
(There are also certificates available from the The National Association of Residential Property Managers, for those interested in the residential side of the industry).
In general, the commercial property management industry is expected to grow a little more quickly than the national economy in the coming years. One certainty: This is an industry with staying power, and there will be demand for property managers for decades to come.
But there is big, and positive caveat to the scenario for job seekers: People in the property-management industry have been graying for years, and the baby boomers are heading into retirement. The “world’s largest asset class”—that is property—is in need of bodies, and more than that, it needs managers who can utilize the virtual world to market and operate their buildings.
“Real estate’s traditional, aging workforce is becoming a major perception problem in recruiting. Decades of lax recruiting efforts have left the entire commercial real estate industry skewed toward the baby boomer generation,” wrote the Propmodo website recently. Nearly half of employees in the commercial property industry are 55 years old or more.
So for mid-career job-switchers or college graduates, the commercial property management profession promises to be a good choice in the long run.
After gaining experience in the property management industry, some may wish to start their own property management firm. Many smaller commercial property owners, but even some larger shops, farm out the property management function.
Of course, in their years as an employee in the industry, the would-be property management entrepreneur should learn as much as possible about the craft, and meet as many people as possible with the trade. Yes, network constantly. The people met may need a property management firm, or may make excellent employees or partners.
Keep notes on who are the top contractors and vendors, and which building owners have high business ethics. Nothing can drain optimism like a bad client or vendor.
As you get clients, tell each building owner that the smartphone in your hand will be answered 24/7.
It is rare to find a good-paying industry with open arms for new talent that is not flooded with applicants. But commercial property management has nearly slipped off the radar of an entire generation of Americans.
The glamor profession of institutional property investment management is well enough known, while big-time real estate brokers gain headlines in trade press. But the concept of property management seemingly has been lumped in building supervisors and windowless basement offices.
However, with the advent of the internet and online business and building-management software, the profession has drastically expanded horizons in the last 20 years.
A modern-day building manager may be tasked with creating a building website and online image in social media, or even staging building events.
Today’s building managers may monitor building metrics to comply with environmental, social and governance (ESG) goals—or even research and then help advise owners on the equipment and procedures needed to reduce water and electrical consumption, and effectively reduce carbon emissions.
Indeed, property managers today operate “building engines,” which are software programs that can automate many tasks, such as billing and tracking monthly rent payments, or reminding management of regular maintenance needs, or even spot excessive electrical consumption needing a fix.
Away from the ubiquitous computers, building managers must work on relations with commercial tenants, a role that requires tact and personality.
The property manager who can enhance the perceived “company culture” of a building is a valuable asset. While commercial buildings vary, in some modern office buildings—particularly those with shared space arrangements—building managers are tasked to “curate” incoming tenants as well as onsite amenities, such as food options and ground-floor retailers. The building manager may create an exercise room with lunch-time yoga instructors, or host an evening art show with top-notch snacks and a wine bar.
In short, the modern-era property manager has many hats to wear, and a profession that is far more sophisticated than collecting rents and making sure the lightbulbs are changed. The trade has vacancies, employment is steady, and the pay is good and rising. For many, a career in property management could be the right choice.
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You might chuckle at a three-page sublease clause in a commercial lease, thinking that some lawyers are putting their kids through college billing with this wasted verbiage. The reality is that owners of commercial real estate do need to properly restrict sublease rights to protect their profit, income streams, and property value. It’s important that landlords don’t allow high-profile tenants to weaken these crucial sublease clauses that protect their interests.
Real estate investors often look at the highest IRR when comparing one investment to another. But, in commercial real estate, such criteria is potentially short-sighted. Instead, investors should be evaluating commercial real estate opportunities by looking at their risk-adjusted returns – not just the overall IRR.
A recent article from CNN, “The Office, As You Know It, Is Dead”, suggests that working from home may not be a short-term phenomenon, but instead a permanent shift to remote working even after a vaccine is found for Covid-19.
