NREV maintains that quality property management increases sustainable net operating income (NOI), and must be supportive of a project’s leasing program.
NREV’s property management process is as follows:
• Conduct a comprehensive property review;
• Notify all parties of management change, from tenants and contractors to utilities and local government;
• Review all property and liability insurance and verify that there are no serious “life-safety” issues.
• Meet all accessible tenants within the first 7 business days, and interview important vendors reviewing their contracts, scope of work, performance standards and costs;
• Examine all existing leases and CAM reconciliation letters; and prepare lease abstracts, structured to facilitate valuation of the property;
• Obtain estimates for needed project deferred maintenance and capital repairs, as well as vacant unit repairs, maintenance and preparation of the center for effective leasing;
• Assess compliance with ADA, environmental and other applicable laws;
• Perform a compliance review of all key legal documents, including mortgages, zoning ordinances and insurance policies;
• Acquire updates of surveys and title documents;
• Analyze the current tax assessment;
• Meet with local officials to verify code compliance, establish working relationships and obtain all available permit plans;
• Prepare a rent roll, cash budget and valuation of the property and discuss a proposed Value Plan with for the client’s review, revisions; and
• Upon commencement of management operations:
…….o Institute strict collection procedures and cost controls to maximize net operating income;
…….o Ready vacant units for showings to maximize the project’s leasability;
…….o Manage the Property in accordance with the Value Plan; and
…….o Provide clients with monthly reconciled financial reports that tie with the cash budget, and progress reports on meeting the goals set for the project.
The Case Study of Northwood Commons demonstrates the impact of these management techniques. A number of long time tenants who renewed their leases, including Ed’s Fine Wines, Sole n Heel and Nicholas Financial stated in writing that NREV was the best manager which the center had ever had.