Operating costs are part of buying and managing real estate properties. Maintenance, cleaning, parking lots, and other factors are considered operating expenses. While some expenses cannot be reduced, there are ways to cut other costs associated with your property. Read on to learn about some of the tactics you use to manage some of your real estate operating expenses. .
Small but mighty changes
1. Maintain the Property
Perform preventative maintenance on any equipment to avoid costly problems down the road. Checking on your equipment regularly helps you catch an issue early if it arises. This saves you money and time when a repair is needed. An in-house maintenance team also cuts down on repair costs compared to hiring an outside company to fix the problem.
When you recognize and repair problems efficiently and quickly, your tenants appreciate your actions. It demonstrates your dedication to providing working equipment for them and builds a strong relationship. Tenants are more likely to stay when they feel like their needs are being heard.
2. Use Green Alternatives
Water and electricity are expensive in older properties, but there are ways to bring the cost of utilities down. One simple solution to lower utility costs are switching regular light bulbs for LED bulbs. LED bulbs last longer and use less energy than other lighting options.
Another way to decrease your utility expense is by installing low-flow toilets and shower heads. Using these sustainable alternatives reduces your utility bill and is an attractive feature for potential tenants. If your water bill is more expensive than usual, check for any water leaks on the property. Depending on your property, water usage could be high due to landscaping maintenance. Water usage is reduced significantly by using equipment and watering systems with sensors regulating the water.
Look for additional ways to improve sustainability in commercial real estate, through renewable energy, smart systems and other options.
3. Shop Around for Quotes
It is normal to look at different companies for insurance, internet, and other personal services – why not do so for commercial properties? Shop around for better prices, service upgrades, and new technology regularly. Different companies outside your usual provider may offer better deals on internet and insurance plans than you currently have.
4. Appeal Your Property Taxes
Property taxes are a costly expense for property managers to pay every year. Your property’s taxes could be appealed and reassessed. If the taxes on your property have increased significantly, you should try to appeal the taxes. Hire an experienced tax appeal expert to help you with the appeal process. Tax appeal experts make sure you are not paying more than the bare minimum for your property.
5. Use Smart Lockers
Delivering tenant’s mail causes time to be wasted where it isn’t needed. Holidays, birthdays, and other events make sorting or delivering mail takes more time than usual. Smart lockers cut down on needing extra staff to work in the mailroom. Tenants receive a text or email when they receive something and have a barcode in the message to unlock the locker. This helps tenants feel safer when receiving packages.
Managing your real estate operating expenses is challenging and time-consuming, but STRATAFOLIO is here to help. Schedule a 1:1 demo to see how we help you manage your properties.