wning a building requires a big investment in time and money. Someone has to collect rent, fill vacant spaces, handle maintenance issues, and generally just try to keep the tenants happy—and that’s just the beginning.

“A landlord might not be skilled, trained, or have enough time in order to properly manage a component of the property, such as accounting, prepping for taxes, knowing which vendor to call, managing reserves, maintaining records, or acting as a master negotiator,” explains Kassandra Taggart, the president and broker-in-charge of Real Property Management Last Frontier. “They also need to be available 24/7 in case of emergency and be able to keep up with today’s fast-paced technology environment.”

To this end, many landlords—individuals, retirement accounts, corporations, LLCs, trusts, and partnerships—hire residential and commercial property managers who are adaptive to the needs of the tenants and ultimately the revenue streams that make properties perform.

According to Taggart, there are many reasons why outsourcing the work associated with running a building or an entire portfolio of properties can benefit a landlord.

“The speed to respond and complete tasks is faster, and this is especially important when it comes to tenant retention,” she says. “Tenants are demanding faster turnaround service.

“We work with 234 separate vendors who we can tap when we need assistance,” she continues. “If there is a plumbing issue that’s flooding the street, we have the guy who has the tool to shut off the water main on speed dial. We can solve the problem within minutes.”

In 2019 alone, the staff at Real Property Management responded to 89,334 emails, averaging 1.2 days to reply and complete requests.

Long gone are the days when a single person was able to handle the needs of even a handful of tenants, which is why many property management companies have moved to a team approach.

“When a landlord calls us, he or she is automatically plugged into our thirteen-member team that includes licensed property managers, certified accountants, people who specialize in brokerage and licensing laws, and paralegals,” says Taggart. “It’s like hiring a law firm where there are specialists in many different areas.”

Technology plays an integral part in effective property management. “Property management isn’t just collecting a rent check and moving on,” says Taggart. “Now tenants want to e-pay by debit card and use technology to report maintenance issues without having to pick up a phone.”

She adds that tenants expect service on demand, which is forcing landlords to find managers who can handle a lot of requests coming at them at fast speeds. “If you’re a property owner without technology, such as cloud-based systems and performance benchmarks to hold your management team and tenants accountable, your competition will outpace you.”

As the tenant demands increase, along with local, state, and federal guidelines and regulations, landlords who take a DIY approach may find themselves overwhelmed.

“When you don’t have expertise in this area, you can miss out on opportunities to add revenue or to prevent expenses,” says Taggart. “A property manager can help you avoid costly mistakes.”

She gives the example of a landlord who didn’t monitor the elevator in his building as part of routine operations, so it was missing the proper permits. “When a city inspector was in the facility, he saw that it didn’t have permits, which resulted in the landlord receiving multiple layers of fines and having to bring it back up to code,” she explains. “During that time it was not operational and tenants had to use the stairs, which made them angry and led to a host of other problems.”

Taggart adds that a property management company familiar with permitting would have identified this issue, saving the landlord the headache of fines, tenant displeasure, and wasted time.

While a property management company can take over the entire operation of a building, it can also be hired as needed to do the parts of the job that a landlord doesn’t want to do. This can include asset management (monitoring a landlord’s employees and operations); portfolio management (monitoring all the landlord’s assets and proposing plans to maximize overall return); and leasing. Property management companies also offer á la carte services, creating custom packages to meet landlords’ needs.

Robin Brena, owner of RSD Properties and CoWork by RSD, prefers to have an in-house property manager but outsources the work of filling vacancies to Regal North Commercial, a real estate and business boutique in Anchorage that buys, sells, and leases commercial properties, among other services.

Brena, who owns nine office buildings in Anchorage, one in Maui, and a retail location in Skagway, among various other properties, says, “We prefer to maintain a direct relationship with our tenants; if they call, we return the call within the hour.

“We use Regal for filling vacancies because they have expertise in regards to the real estate market—they are out in the market more often than we are, and they have a very broad reach,” he adds. “We value those skill sets: It’s one thing to take care of an existing building; it’s another to create a marketing plan and fill vacancies.”

While he doesn’t have numbers for how many companies choose to manage their own commercial properties versus hiring a property management company, Taggart believes that it’s similar to what’s happening in the residential real estate market.

“In Anchorage, there are 44,000 rental dwellings, but true property managers are responsible for only 1 percent of the market,” she says. “About 20 percent of companies who own buildings have a staff that manages them; the rest are landlords who do it themselves.”

With an abundance of property management companies out there, it’s important to find the right fit when turning over this level of financial and tenant responsibility. Some of the issues to discuss during the interview process include how a property management firm operates; its level of communication with the landlord; the size of properties it manages; the retention and turnover of staff; the retention and turnover of tenants; and how many vendors they have on hand.

“You also want to ask more in-depth accounting questions—not only if they provide this service, but if they handle reserve analysis because not all companies can perform detailed accounting,” says Taggart.

This is especially important when managing an entire portfolio of properties that can include anything from multi-family residential units to strip malls to office space and warehouses.

“A good property management company looks at the whole picture and can advise landlords on when to buy and sell, when to reinvest, and how best to redevelop space to attract more tenants,” Taggart says. “They can also analyze the best time to move money for maximum return.”

A property manager should be licensed, as well as bonded and insured. Individuals may hold a real estate broker’s license or have earned a degree in property management.

UAA offers one of only a handful of programs in the nation that offer a four-year degree in the management of real estate assets. The Weidner Property Management and Real Estate Program, which is housed in its College of Business and Public Policy, provides training in leasing and market analysis, asset maintenance, operating budgets, cash flow analysis and performance ratios, human resources, negotiations and conflict management, fair housing and landlord-tenant law, real estate and contract law, managerial communications, micro and macroeconomics, risk management, and more.

Like any industry, the COVID-19 pandemic has caused property managers to have to adapt to new conditions. Not only do they have tenants who have been hurt by the economic slowdown but they are also facing a formidable shift in the market.

“Every landlord is dealing with COVID issues differently; those that have reserves are offering delayed rent or payment plans or giving discounts on long leases. They are bending over backwards to front some of [the] weight if they can,” says Taggart. “Others—who may be hyper-leveraged or want to get rid of certain tenants—are taking a more hardcore approach and using the court to pursue evictions.”

Many tenants are now realizing that working from home has its advantages, and Taggart says that some of them are considering changes, especially if they are at the end of their leases.

“We need to learn to do business differently; there has been a paradigm shift, and things are not likely to return to what they were,” he adds. “People are also now more concerned about safety in the workplace, and that’s going to require more from landlords to ensure that they have a safe space in which to return.”

“The key thing we’re offering is higher technology, including a blazing internet connection,” Brena says of his coworking space in Anchorage. “People can still work at home but as members of CoWork can also have the ability to expand or contract their space as needed. Members can rent a conference space for an hour or hold an event with seventy-five people with audio-visual capacity. The space can be created around what they actually use,” he says.

“Community and progressive commerce are everything when it comes to where you will conduct business—that can be at home, in a physical building, or in the digital universe from wherever you wish to work remotely,” says Ryan Mae Lucas, owner of Regal North Commercial, which will manage the new coworking space. “Our team is obsessive about the marriage of functional and modern business practices while helping our clients pivot into the new digital age. Adopting technology and new ways of working will be evidenced by those that come out ahead post-COVID-19.”

In Alaska, where the economy has taken some big hits, flexibility can mean the difference between reopening and shuttering forever. “Alaska is a very dynamic market; as an oil state, we’ve seen many challenges to the industry, and the pandemic just compounded these issues,” Brena says. “There is so much political change and volatility in the business environment that having a flexible space can help mitigate a company’s risk.”

During this time of market upheaval, coworking spaces can also benefit landlords and the property managers who need to fill empty buildings.

“From a landlord point of view, if a space doesn’t fit a tenant and they leave, that may mean a vacancy of one month, or four months, or up to a year,” Brena says. “With a coworking space, membership may go up and down, but you’re never at zero.”

He adds that a coworking space can also act as a feeder for a landlord’s other properties. “People may start out working from home and using a coworking space, but as they grow, they may want a more conventional space, which allows us to bring them into our business model.

“From the market information I’ve seen, ultimately 10 percent of office space is predicted to become coworking types of settings,” he says. “The market is now at 1 percent, so I think this is an area of expansion, not just in Alaska but nationwide.”