Property Management and Leasing

1
Property Managementand Leasing

• Real Estate 310
• Principles of Real Estate
• Dr. Longhofer

2
Property Management

• Property management involves the leasing,
  managing, marketing, and overall maintenance of
  real estate
• Residential (apartments, condominiums and
  cooperatives, single-family homes)
• Office buildings
• Retail complexes
• Industrial properties
• Hospitality properties (hotels and motels)
• Special purpose facilities

3
Roles of the Property Manager

• Position the property in the market and advertise
  it to prospective tenants
• The management plan is a document that
• Analyzes current market conditions
• Evaluates the subject property and its position
  in the market
• Outlines the investors objectives
• The management plan is then used to make
  recommendations regarding the property, position
  it in the market, and help determine appropriate
  rate schedule

4
Roles of the Property Manager

• Select tenants and negotiate leases
• The manager may act as his own leasing agent, or
  may hire a broker to do this for him
• Remember, however, that the manager is concerned
  with the long-term viability of the property,
  not just leasing space to earn a commission
• Selecting good tenants is essential for long-term
  profitability

5
Roles of the Property Manager

• Collect rents and maintain good tenant
  relationships
• Collecting rents, of course, is the fun part
• What will you do, however, if the tenant is
  delinquent?
• The ultimate success of a property manager will
  be his ability to maintain good relations with
  tenants
• A bad property manager will drive out good
  tenants every time
• Oversee administrative tasks
• These include preparing the budget, maintaining
  the property, hiring and overseeing employees,
  and recordkeeping

6
Legal Issues for Property Managers

• Property managers must be familiar with a wide
  variety of regulations and laws
• American with Disabilities Act The ADA requires
  that people with disabilities have full and equal
  access to services and facilities
• Fair Housing Act The FHA prohibits
  discrimination in residential properties on the
  basis of race, color, religion, sex, handicap,
  familial status, and national origin.
• Employment laws, landlord-tenant laws,
  environmental hazards, and more

7
Real Estate Leases

• The lease is the document that outlines the
  rights of the landlord and the tenant
• Recall that the lease divides the real estate
  interest into two components
• The leasehold interest gives the rights of
  possession, use, and control to the tenant
  (lessee)
• The landlord (lessor) retains a leased fee
  interest

8
Common Leasing Issues

• Possession of Premises
• Use of Premises
• Term of Lease
• Security Deposit
• Improvements to Premises

• Maintenance of Premises
• Destruction of Premises
• Assignment and Subleasing
• Recording a Lease
• Options

9
Types of Leases

• Gross lease
• Net lease
• Double-net and triple-net leases
• Percentage lease
• Step or graduated lease
• Indexed lease
• Other types of leases
• Ground lease
• Oil and gas lease