Here are three property management business plan tips to think about before expanding your real estate business.
Focus On A Single Asset Class
One of the most important things to do when developing a property management business plan or a comprehensive real estate business plan is to focus on a specific real estate asset class, and then ‘drill down’ to a specific sub-class.
An example of this on the residential side would be single- or multi-family homes. Then then focus on a specific price range, area of town, or number of units in the property.
An example of this on the commercial side would be multi-tenant retail or office. After selecting the type of commercial property you will property manage, determine the class of property (A, B or C) and the property size in terms of square footage.
Developing A Solid Property Management Business Plan
It might seem counter-intuitive by narrowing the type of property you will manage. But narrowing your focus is great for your real estate business for three reasons.
First, tenant personalities and issues will be more similar. Their wants and needs will be as well.
The things that a medical tenant requires are much different from what a mom-and-pop small retail business will need.
Second, owner personalities will be more alike as well. Real estate investors who buy office property are much different from those who invest in small multi family buildings. Plus you’ll learn how to avoid a problem property owner.
Third, you’ll develop a skill set much quicker when you manage only certain type of real estate asset classes.
This will let you grow your property management business faster. You’ll be able to transfer the skills you’ve learned in working with similar tenants and owners to other like-kind real estate. You’ll also be able to target your property management marketing to the audience most likely to respond.