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Unit 19

Terms in this set (23)

Property Manager
Wears many hats
- achieve the goals of the owners
- generate income
- preserve and/or increase the value of the property
Securing management business
- corporate owners
- apartment buildings
- owners of small rental residential properties
- homeowners associations
- investment syndicates
- trusts
- owners of office buildings
Specialization has opened a range of new opportunities
Well-trained specialists are needed to manage shopping centers, commercial buildings, and industrial parks, in addition to the more visible management of residential properties.
Manufactured homes
homes that are built in a factory and towed to the home site, where they are installed
Resort Housing
Managing second-home and resort rentals presents specific challenges.
Management Agreement
a contract creating a general agency relationship between the owner and the property manager.

- It is a guide used in operating the property, as well as reference in case of any future disputes.
The Property Manager Role
Considered a general agent

An agreement should be in writing, and should include the following points:
- Description of the Property
- Time period the agreement covers and specific provisions for termination
- Definition of the manager's responsibilities
- Statement of the owner's purpose and responsibilities
- Extent of the manager's authority
- Reporting
- Compensation
- Allocation of Costs
- Liability
- Antitrust provisions
- Equal Opportunity statement
Operating Budget
The projection of income and expense for the operation of a property over a one-year period.
Cash flow report
A monthly statement that details the financial status of the property.
profit and loss statement
a financial picture of revenues and expenses used to determine whether a business has made money or suffered a loss
budget comparison statement
Compares actual results with the original budget, often giving either percentages or a numerical variance of actual versus projected income and expenses.
Collecting rents
a property manager should accept only those tenants who can be expected to meet their financial obligations
terms of rental payments spelled out in the lease agreement
- time and place of payment
- provisions and penalties for late payment and returned checks, and
- provisions for cancellation and damages in case of nonpayment
Maintaining good relationship with tenants
The ultimate success of a property manager depends on the ability to maintain good relations with tenants
Maintaining properties
- Preventive
- Repair of corrective
- Routinr
building-related illness & sick-building syndrome (SBS)
...
Risk Management
the four alternative risk management techniques:
- ACTOR
- Avoid
- Control
- Transfer
- Or
- Retain
Surety bonds
cover an owner against financial losses resulting from an employee's criminal acts or negligence while performing assigned duties
Multiperil policies
Such a policy offers an insurance package that includes standard types of commercial coverage, such as fire hazard, public liability, and casualty.
Two types of Insurance
Depreciated/Actual Cash Value = Insured for what it was originally worth, less the depreciation in value that results from use and the passage of time
A statement sent to an owner that does not reflect the entire debt service as an expense is called
Profit & Loss statement. The profit and loss statement provides a general financial picture based on monthly cash flow reports. Only the interest portion of the debt service is reflected.
Consequential Loss, use, and Occupancy
Also called business interruption insurance, offsets loss of rental income due to disasters that keep a property from being used.
Tenant Improvement
are alterations to the interior of the building to meet a tenant's particular space needs.
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