Chapter 5: Managing Retail Properties

Question 1

Classification of Office Properties

Answer 1

• Grade A
• Grade B
• Grade C

Question 2

Grade A Offices:

Answer 2

• Prestigious & prime location
• International Market
• Rental: usually high af
• In the heart of financial district
• grand lobbies

Question 3

Grade B Offices

Answer 3

• rent is usually cheaper as facilities is not as superior
• image not as good as Grade A
• in suburbs/less prime locations

Question 4

Grade C

Answer 4

• just provide functional space
• maintenance is ew
• shophouses etc
• sometimes no lift

Question 5

What is your job?

Answer 5

• keep vacancy rate at minimum
• ensure building commands market rent

Question 6

Management Challenge in Office buildings (what need to do what, to lead to what)

Answer 6

• Reduce vacancy rate
• Attract & retain tenants
• Match market rental rate
• IT & Internet revolution
• Well designed & Maintained buildings

Question 7

What does SOP stand for?

Answer 7

Standard Operating Procedures (SOP manual).

Question 8

What is a SOP manual?

Answer 8

• most basic and essential tool an office building manager can have
• every office property should have its own SOP
• a detailed collection of instructions pertaining to every phase of an office building’s operation

Question 9

what does an sop manual tell you

Answer 9

what, when, how, and by whom each operation is to be performed

Question 10

2 major functions of an SOP manual

Answer 10

• Administration
• Operation

Question 11

Administration in SOP

Answer 11

• Organizational chart of the building
• Job description for each position

Question 12

what does Organizational chart of the building do?

Answer 12

• shows the various members of a
  building’s management team.

Question 13

what does Job description for each position do?

Answer 13

• outline the duties and responsibilities connected with jobs .

Question 14

Operation in SOP

Answer 14

step-by-step course of action that states exactly how a system or policy is to be carried out

Question 15

4 components an sop includes

Answer 15

• Data about the system or function
• Physical location of any essential items
• Narrative description of the operating system
• Emergency procedures

Question 16

Create an SOP manual needs:

Answer 16

• gather information about the building
  and analyse it in order to develop a SOP for each building function.
• procedures must be written in a clear and concise manner so that the management staff can understand them quickly and easily
• The procedures must be implemented into the building’s management plan

Question 17

Benefits of Standardization

Answer 17

• permits building activities to be administrated effectively on a continuous basis
• successful management is made possible when everyone involved in operation of the building learns the policies and procedures
• ensures operation is not affected by employee absence or personnel turnover
• excellent source for orienting and training new personnel
• serves as complete guide to buildings M&E systems and equipment, is especially important in emergency situations
• increase productivity, especially if members are asked to write their own job descriptions & discover wastage of effort time/paper work
• sections that can be separated and distributed
  selectively, it promotes its effectiveness as a management tool.

Question 18

Tenant Manual

Answer 18

• Many of the procedures will be of direct concern to tenants
• who should be given a copy of those parts of the manual
• relating to such matters as after-office hour operations, reporting
  maintenance problems, mail and deliveries, security procedures,
  etc.

Question 19

Lease Administration covers

Answer 19

• Supervising move-in procedures
• Maintaining tenant relations and communications
• Keeping records
• Establishing and enforcing a rent collection policy
• Move-out procedures

Question 20

So what is lease administration like?

Answer 20

• begins when a tenant signs a lease and ends when tenant moves out of buildings
• aim to serve needs of tenants while enabling management to carry out tasks & responsibilities
• understanding tenant’s needs
• do what is necessary to meet those needs within framework of lease agreement is the job of property manager

Question 21

Move-In Procedures in Office Buildings

Answer 21

• once lease is signed, manager must get in touch with tenant to organize the moving in
• checklist used
• may send a letter advising tenant about procedures.

Question 22

Objective of Move-in letter must

Answer 22

• To co-ordinate the move-in
• To obtain routine tenant information - To inform the tenant of the building’s operating procedures

Question 23

A sound procedure for supervising the move-in includes the following steps:

Answer 23

• Joint inspection of the leased premises by property manager, the tenant and
  even a representative of the moving company. Any unfinished items should be recorded in a list and corrected by management prior to move-in.
• On the actual date of move-in a
  management representative must be present to supervise and to take note of
  wear and tear caused to the building by the move-in.
• For good tenant relationship: can have a catered lunch for employees of the tenants the next working day. Property manager should visit the tenant during the first day to offer routine assistance as well as moral support.
• A copy of the tenant’s manual should be handed to the tenant on the first day.
• A subsequent visit should be made to inspect leased premises for any unfinished construction items.

Question 24

Tenant Relations and Communications Purpose

Answer 24

• reduce cost of turnover(tenant moving out)

Question 25

Tenants relations program

Answer 25

- to create confidence in management's goodwill & competence - achieved through efficient response to tenant's request & needs

Question 26

Steps for good tenants relations

Answer 26

- appoint a maintenance contract - establish procedures for responding to tenant requests - logbook recording - formal tenant feedback via survey

Question 27

Keeping records

Answer 27

- tenant lease file - critical data file

Question 28

What is in tenant lease file?

Answer 28

- lease doc - lease brief - rent roll change instructions - correspondence - lease amendments - escalation info - key info - alterations - billing - copy of 'as built plans'

Question 29

Critical data info

Answer 29

- remind of upcoming activity concerning a building's tenant

Question 30

Move out policies

Answer 30

- no matter how well-maintained a building is, tenant will vacate premises eventually. - essential that manager anticipate moving date and name of company handling physical move - in order to alert security guard & make necessary arrangements - make sure all outstanding debts paid, and premise is put back in leasable condition

Question 31

Rent Collection Policy

Answer 31

- defined as the set of procedures necessary to close the gap between the rental payment day established in the lease document and the dates tenants actually pay their rents if no collection policy exists

Question 32

rent collection need do what

Answer 32

- need to check client's creditability - supported by accounting system

Question 33

how to establish a rent collection policy

Answer 33

- when rent is paid - first reminder: telephone call/letter - second reminder: warning of legal consequence - third notice: legal action has been initiated (need lawyer)

Question 34

rent collection policy should:

Answer 34

* Reflect existing market conditions. If the market is in a tight supply situation, a strict policy can be enforced. * Reflect the professional image that the building ownership and management wish to project