The following is a list for commercial real estate property owners to help safeguard their commercial rental property investments.
1. It is recommended that a property owner consider employing an accountant to collect rents, common area fees, real estate taxes and insurance. This keeps the money out of the hands of the property manager, and it gives the owner peace of mind. In addition, it may reduce the property management fees.
2. An owner should always acquire a copy of the property manager’s real estate license and a certificate of insurance from their errors and omissions carrier.
3. The property owner must always perform due diligence on the property management company by calling all references. In addition, he or she should call the title company of an address where he sees a sign of the prospective property management company to ask the property owner about the management services.
4. The owner should also inspect some properties that the property management company maintains and pay attention to the condition of the premises.
5. The proprietor should not have the management company be the leasing agent. This protective measure will possibly eliminate any future conflicts of interest.
6. If an owner has used a maintenance company in the past with good success, he or she should specify to the management company to employ the maintenance company on the owner’s behalf and place that in writing in the contract.
7. Always request from the management company any additional fees that may be assessed to the owner.
8. The property owner must always investigate with the California Bureau of Real Estate any complaints filed against the proposed management firm by phone:
(877) 373-4542 or go to the website: www.calbre.ca.gov.