The Differences Between Commercial and Residential Property Management

1

• The Differences Between Commercial and
  Residential Property Management

2

• When researching property management companies,
  youll notice that they fall into two categories
  commercial and residential. There are major
  differences between the two and only by
  choosing the right one for your needs will you
  receive the support and services you require.

3
Leases

• A lease for a residential property is usually
  brief, quite standardized, and easy to renew. In
  contrast, leases for commercial tenants are
  complex and may feature a variety of extension
  options. Only a commercial property manager is
  likely to understand such leases, know how to
  increase the price to the appropriate amount on
  an annual basis, and be able to help you if the
  tenant wants to end the contract early, which is
  often difficult and will depend on the
  termination clauses.

4
Tenant Payments

• Tenants for residential properties only need to
  pay rent and utilities. This keeps things simple
  for residential property management companies.
  Commercial building tenants, however, are usually
  required to pay a number of expenses relating to
  property tax, insurance, and maintenance.

5

• Depending on the type of lease, tenants may need
  to pay all or just some of these expenses. For
  instance, with a triple net lease, the tenant
  pays a net amount for all three, whereas with a
  gross lease, the landlord pays the expenses using
  fixed rental fees. There are also modified net
  leases (which are somewhere between a triple net
  lease and a gross lease) and percentage leases
  (common for retail malls).

6

• Whatever type of payment system you choose, it
  will be complicated for your property manager.
  This is why you need someone who is experienced
  in dealing with lease types, who will understand
  the clauses, and who will know how to conduct an
  annual recalculation of costs, if applicable.

7
Availability

• Residential property managers only need to visit
  the building for short periods, often on a set
  schedule. Their main duties consist of collecting
  rent and carrying out any necessary maintenance.
  Commercial properties, however, often require
  much more attention. In fact, if your building is
  a large office or mall, you may need a manager to
  be onsite at all times.

8
Tools and Software

• Finally, commercial property managers have tools
  and software at their disposal that a residential
  property manager would never even need.

9

• Managing residential properties is always much
  simpler than managing a
• commercial property in Edmonton. Building owners
  with anything other than a residential property
  should always choose a professional who
  specializes in commercial buildings if they want
  to prevent problems and receive top-quality
  services.