When you find a good asset manager and a good property manager, you can trust them with your investments.
They can take a lot of weight off of your shoulders—something that most of us are looking for in today’s hectic world! Many investors understand that property managers are central to their real estate business, but do you know why asset managers are important? Read on to learn more.
How do asset managers and property managers differ?
Asset managers and property managers serve two very different roles for commercial property owners.
Property Manager Responsibilities:
- Manage day-to-day operations on a property level
- Show property/units to prospective tenants
- Find and/or screen tenants
- Answer tenants’ questions and address issues
- Manage maintenance and repairs
- Enforce the rules of the property
- Collect rent and other fees
- Ensure tenants take good care of the property
- (Sometimes) help with budgeting and other financial matters
Asset Manager Responsibilities:
- Manage the big-picture financial matters
- Prepare financial forecasts for properties
- Figure out a property’s financial performance using cash flow analysis/internal rate of return
- Determine a property’s value
- Make plans for increasing/maximizing the value of the property
- Negotiate deals regarding the property
- Work with lenders
- Help owners sell their property for more than they bought it for
What do asset managers and property managers have in common?
When you find a good asset manager and a good property manager, you can trust them with your investments. They can take a lot of weight off of your shoulders by acting on behalf of you when it comes to your property. Here are some of the advantages you get from both asset managers and property managers.
Both Help Increase Your Profits
According to the definition of asset management on Investopedia,
“The purpose of asset management, whether with real estate or any other asset, is to cultivate market value so ownership can increase its returns.”
Similarly, Investopedia describes property management like this:
“The property manager acts on behalf of the owner to preserve the value of the property while generating income.”
Even though they go about it in totally different ways, your asset manager and property manager both have the responsibility to maintain (and hopefully increase) your property’s value. Both professionals can help you get the best value out of your rental property and ensure steady profits over time.
Both Save You Time, Enabling You to Focus on Growth
Time is a scarce resource. Once you’ve run out of hours in the day, you can’t get them back. If you don’t have professional help with your real estate investing business, your day might look something like this: struggling to organize your finances, driving to your property to meet a prospective tenant, and then working late sourcing your next property. But wouldn’t you rather focus on growing your business, then go home by 6 pm to relax and spend time with your family?
Both Are Experts in Their Respective Fields
This brings us to the next point: asset managers and property managers are experts at what they do, meaning that they can probably do their job faster and better than you could do it yourself. Sure, maybe you’re capable of doing what they do, but it’s safe to say that you probably lack the depth of experience that these professionals have.
Why aren’t asset managers always considered as crucial as property managers?
It’s easy for most property owners to understand why they need a property manager. As a busy business owner, you don’t want to get a call at 3 am about a leaky bathtub in your residential unit, and you don’t have time to manage the cleaning and maintenance staff in your commercial units. In addition, it’s easy to understand how a well-taken-care-of property is far more valuable than a property in disrepair.
But sometimes, it’s hard for property owners to understand how an asset manager can help them. They think they have the financial aspects of their property under control. And maybe they do! But they might be underestimating the impact of an experienced asset manager who can look deep into their finances and make excellent decisions.
For some companies, these are separate positions. For smaller companies, these roles may be combined. But it makes sense when combining these roles, to look for people who have the skill set to do both roles.
Why it makes sense to have a property manager and an asset manager
When you have a property manager, your day-to-day operations will be handled, saving you time, and often helping to increase your profits. And when you have an asset manager, you can make smarter financial decisions, maximize your income or ROI, and save time while you’re at it. But when you have both, or you hire someone with the capability to do both, you’re in a position to save time, get double the professional advice/help, and grow your business even more!
The right people in the right position is undoubtedly critical. But, so is having the right software to manage your business. Learn how STRATAFOLIO can support your team with automation, access to valuable insights, and more. Request a demo today!