Caton Commercial

property management

Retail Portfolio Gains Value Through Addition of Property Management

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Commercial real estate (CRE) is an attractive investment because of its consistent returns, passive income, and growth potential. The commercial sector of real estate investing is becoming more and more popular as an alternative investment. However, while it has the potential to be profitable, the acquisition of commercial investments is only the first step to strategic profitability. Knowing when, what, and how to manage the assets in a commercial real estate is an essential component of success or failure.

A successful owner of five high-profile suburban Chicago retail centers reached out to Caton Property Management after struggling to achieve desired financial outcomes with his investment portfolio.

As part of the onboarding process, the property management team conducted an analysis of the financial records, reviewed tenant leases and performed visual inspections of each of the retail strip centers. They also began contacting existing tenants to help facilitate a smooth transition and to prepare the business owners to work with the management team directly. As part of this analysis Caton discovered that several tenants had not paid their CAM reconciliations for several years. Other issues were also discovered that had been negatively impacting the annual net operating income across the portfolio.

Within the first 120 days the property management team made an impressive collection effort netting over $70,000 in balances due from 2019, 2020, and 2021; reducing delinquencies within a very short period of time. Recognizing the opportunity to reinvest the unexpected funds back into the assets, the owner allocated the funds to several maintenance projects and exterior improvements.

Leasing vacancies is a natural next step after securing lost revenue and bringing maintenance up to date. In this case, Caton Property Management partnered with the brokerage division of the firm to lease the primary vacancy in the portfolio. With the combined power of marketing and relationships, Caton Commercial Real Estate broker, Rich Bowden, was able to attract and secure a long-term lease with national tenant within 60 days of listing the space for lease.

The value of commercial real estate is mostly dictated by three things, the location of the property, the physical building and how well it’s maintained, and the quality of the tenants occupying the spaces. After the critical first steps were taken to re-establish a relationship between this investor and his tenants the expectations for tenants has been reset. Caton Property Management continues to deliver comprehensive service with day-to-day tasks such as tenant relations, rent collection, CAM reconciliation, preparing a budget, capital improvement projects, invoice payment, maintenance, and monthly financial reporting.

Caton Property Management takes pride in finding effective solutions to their clients’ most challenging concerns as well optimizing investors’ property values.

Increase Investor Profits with Professional Apartment Property Management

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Apartment investors purchase property with the goal of generating income. There are two sides to income generation for an investment property. First, the owner can take a share of the annual operating profit generated by the investment, and second, the owner may profit from increasing the market value of the property beyond inflation alone.

Increasing the income generation and market value of a rental property requires a certain level of know-how, an understanding of market values and excellent management skills.

Management and Income

Professional property management is key to increasing and maintaining investment profits. Property management services include rent collection, routine inspections, repairs and maintenance, leasing, budgeting, financial reporting and more. All of this requires “hands-on” experience in the field and the latest in property management technology to optimize convenience for tenants and streamline communications.

Investment Property Valuation

The valuation of a rental property is based directly on the cash return, therefore adding value means increasing cash flow.

When evaluating apartment properties, professional property managers can help in two ways:

First, using a property manager to assist in the evaluation of a property prior to purchase can put you in a position to move quickly before other buyers have a chance to evaluate the investment. Property managers can inspect a property to inform you of the current fair market rental rates and a property’s fair market value based upon the current property condition. They can also advise you of any refurbishments or maintenance items that can attract higher quality tenants, as well as any safety issues you may need to consider in relation to risk management.

Secondly, property managers can assist in the due diligence process by performing lease file audits, review financial reports, coordinate physical property inspection, assess deferred maintenance and determine if capital improvements are necessary, provide a local market survey and assess current property operations. A feasibility analysis can measure the ability to add value. There may be many other measures that must be taken into consideration, such as, applications for new zoning, design and construction planning and a plan for marketing. A skilled property manager can assist with all of these. Their day-to-day experience in the market makes them experts that can quickly and efficiently provide insight into investment properties.

Contact Caton Property Management to maximize your apartment investment property today!

Why You Should Hire A Property Manager BEFORE You Invest

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Why You Should Hire A Property Manager While Investing  – Caton Commercial

The usual way that a property management company comes on the scene is when the owner of a building makes a contact. Often the owner has just acquired the property through purchase or exchange, then looks for a manager. Any questions about Property Management, contact Caton Commercial today.

However, if you are about to acquire an income property, consider contacting a property management company in advance. Their ability to estimate income and expenses and their keen knowledge of the market make a property manager a valuable asset during the pre-acquisition process. The property manager has the background necessary to provide significant assistance in determining both the location, desirability, and economic feasibility of a property. Learn more about how to hire a property manager below and why it’s a good idea.

Why Hire a Property Manager? Property Inspection And Evaluation

When evaluating a property, have a property manager perform a comprehensive inspection of the physical property, thoroughly review current leases and past maintenance records, and, when appropriate, talk with the on-site staff, and current tenants and neighbors.

Preliminary market analyses and pro formas should be completed during the pre-acquisition stage to determine the property’s operating costs and to project possible investment returns. These analyses will help establish whether the property will perform according to the owner’s investment objectives, or whether the property is too risky for acquisition.

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Analyze And Maximize Rent Structure

When the property is acquired, the property manager can determine what can be done with the rent structure. The goal will be to increase the rents to market levels and maximize value. Tenants with leases can not be given rent increases if their leases prohibit them, but the rent for vacant space or for the property with expiring leases may be increased.

Today’s investors in commercial real estate must have a grasp of market conditions and investors need assurance about the true condition of the property and its potential. With increased competition, the market place is becoming more complicated. As your professional commercial real estate management advisors, we are in the position to help you in making a more educated decision in real estate transactions. With this kind of information when considering a commercial property, planning is better and there is less chance for error.