In every city of the world office buildings provide much needed working space in our crowded cities but they bring with them management complexities. Complexities arise in the management of revenues and costs, for actuals, budgets, and cash flows across the many stakeholders that include tenants, management companies and owners of the building.
Owners may additionally be large corporate financial entities that require reporting across multiple buildings using different accounting GAAP, currencies and languages. Complexities arise due to the property management issues being across the many business units or combinations thereof that can cover multiple floors. Also annual weather extremes of heat, cold, winds and rain storms can probe for any building weaknesses and various seasonal celebrations bring peaks and troughs for real estate management action.
Typical property management requirements that should be end-user driven are as follows:-
Management of Revenue
- Budgets that need to be built and maintained across stakeholders and variances explained.
- Management fees and monthly lease or rental fees that need to be efficiently billed to each unit, parking place owner, outlet or corporate gym member with property management software.
- Delinquent payments managed, including interest payments and workflows.
- Auto generation of contextual actionable alerts and workflows to management and clients to drive timely problem solving.
- Lease payments from shops to be calculated including turnover related rent where applicable.
- All postings to the accounts to ideally be at transaction level and posted by month for the duration of the contract giving risk assessment or budget creation personnel an unparalleled level of detail by tenant management and allowing any specific issues to be automated through contextual alerts.
- Renewals that need to be processed quickly to minimize down time.
- Empty spaces marketed by floor space size to attract tenants well in advance of tenant renewals in case of non-renewal with rolling update reports.
- Management of demand to determine future price increases.
- Serviced apartments requiring management and billing of utilities need to be available in some cases recognizing that this form of billing is not available in all software systems.
- Monitoring traffic and flows of people for various reasons.
- Video surveillance of people and for car number plates for revenue planning and audit.
In the above cases comprehensive reporting is required to ensure that all fees are collected from the tenants in a timely manner and all unit renewals are handled efficiently to avoid dead time. Licensing rules from software vendors are not easily managed as property management systems are often not a purpose built module. Solutions are built from accounting components that are priced based on typically “non-property” scenarios that see multiple stakeholders as additional autonomous users acquired at extra cost.
Management of Costs
- Staff or contractors need to be rostered where relevant. Transportation, F&B including vendor machines, security and administrative services need planning.
- Common areas need to be maintained, cleaned and administered for general maintenance and relevant permits issued.
- Various inventory needs to be logged and maintained for all sorts of items for the upkeep of gardens and pools not to mention keys to common areas and building access keys.
- Decorations need to be organized at different festive times of the year.
- Liaison with emergency services for fire safety.
- Preventative emergency repairs scheduled as required.
- New areas of cost management are emerging and need review like those offered by the Internet of Things (IOT) that will allow costs to be fine-tuned as required for better management of cost opportunities.
- Cost management scenarios should cover the entire procurement process with the ability to understand detailed costs and/or variances for any item or service in the various locations for which management services are being provided.
Transparency to stakeholders is important and can only be achieved by having the ability to record and report for all items in multiple dimensions which therefore allows for cash flow surplus and deficits to be visualized through any period.
New technologies today are fast and allow systems to work for you and not vice versa and some are optimized for management accounting meaning fewer steps to achieve the same result which means less errors and faster execution and that helps reverse the anecdotal 80% of time on process and 20% on management review. Contextual actionable alerts over contractual receipts and expenses allow you to quickly understand your business allowing you to take corrective action quickly to minimize losses and to organize your process flows as you want to organize them across all properties. Also business simulations with visualizations allow you to understand how changes in your business model will impact your business.
Paring management charges to an efficient level is a competitive weapon to maximization of profit and attractiveness to tenants in like for like comparisons. Additionally being transparent to any “Resident Committee” is also vital to show accountability to stakeholders.