ommercial real estate can be a lucrative investment, but keeping up with the operation, maintenance, leasing, and security of a facility can make an owner wonder whether the outlay is worth it. Real estate management companies can help make owning a property easier, taking care of day-to-day issues and helping owners meet their long-term goals.

Facets of managing commercial properties range from securing and maintaining the physical assets to providing financial services such as collecting tenant rents. Some companies also offer construction services to help with tenant-requested updates, as well as “à la carte” services to deal with specialized client requests.

“When we say we’re in real estate management, people automatically think of traditional property management from the residential side—companies that take care of apartments,” explains Shea Niebur, broker, managing director, and majority owner of Anchorage-based PTP Management, established in 1998. “But the commercial sector operates differently.”

For one thing, Niebur notes that PTP’s services cover a variety of property types. “The real estate owned by our clients varies from undeveloped land to high-rise office buildings, and our clients rely on our company to effectively manage their investment properties, whether it is vacant, owner occupied, or fully leased with multiple businesses as tenants.”

According to Niebur, potential clients who are new to commercial investments may not be aware of the full scope of responsibilities involved in real estate management. To guide clients, PTP offers a comprehensive list of services combining everything they’ve learned through years of experience.

“From there, potential clients can decide whether they want à la carte services or full service, and we customize and cater it to their needs and the needs of the property,” she says.

PTP manages existing and new-construction facilities that include office, warehouse, retail, medical/healthcare, commercial associations, and other specialized buildings, as well as vacant and undeveloped sites. It also provides rural management for properties located in remote Alaska.

“We have a diverse client base. Our clients include privately held companies, lending institutions, nonprofits, Native corporations, healthcare entities, single owners, and multi-member LLCs,” says Niebur. “We even have an LLC with over thirty members which was formed solely to invest in one property.”

PTP offers a basic real estate management package, drilled down into four categories: asset and lease administration, facility management, real estate accounting, and project management. Clients may also take advantage of maintenance and construction services provided by its contracting company, as well as leasing and sales at the full-service brokerage.

One of the biggest advantages to hiring a commercial real estate manager is having someone who can take care of issues when the owner can’t be there. Management companies also provide a local network that facilitates communication.

“We are your local representative; we not only have eyes on the property and 24/7 response, but we are the main point of contact for all stakeholders,” says Niebur, noting that PTP has built relationships with lenders, tenants, local contractors, vendors, and other owners.

Real estate management companies can also handle financial aspects for owners, including setting up bank trust accounts, collecting rents, facilitating service contracts with vendors, approving and paying invoices, and compiling and submitting financial reports.

Companies like PTP add value, too, by conducting property assessments and offering expert recommendations on safety, building operations, and potential capital improvements. Additionally, they can develop detailed project budgets and provide forecasts for future property performance and operational needs.

In addition to assisting clients, real estate management firms may also work with a building’s tenants. “If a new tenant wants improvements to a suite, we can manage that project on their behalf and solicit bids from qualified contractors,” says Niebur. “Two years ago, we started our own branch of construction services, so we now have a crew in house that can perform the work. We can price it in house using our crew or work as a project manager using outside contractors, depending on the needs of the project.”

While a building owner might think they’ll save money by hiring an in-house person to manage their properties, it may not pay off in the long run.

“If you’re relying on one person to handle all the facets of building management, that person has to be an expert in every aspect,” says Niebur. “It can be overwhelming, and there is a risk of turnover, which can significantly impact property operations.”

Shawn Cange, owner and broker at Cange Group, agrees. “Our clients typically prefer to outsource for experience, efficiency, and scalability that can be hard to match in house, especially for owners that prefer to stay at arm’s length,” says Cange. “More specifically, hiring a management company provides value in four core domains: real estate market and building knowledge; vendor relationships; tenant connections; and software systems.”

Cange has been in the real estate industry since 2000 and opened Cange Group in 2008. Headquartered in Anchorage, the firm manages properties from Palmer to Kenai and “everything in between,” he says.

“We work with a wide variety of properties. On the commercial side, we manage office buildings, commercial condo associations, retail spaces, industrial sites, and mixed-use developments,” Cange explains. “We also own and operate a residential property management company, Paragon Properties AK, which focuses on single-family homes, multiplexes, and HOAs [homeowner associations].”

For commercial properties, Cange Group offers leasing, sales (brokerage), leasing/advertising, lease negotiation, tenant onboarding (collecting security deposits, obtaining certificates of insurance, and lease set-up in its software), rent collection, tenant relations, project and construction management, managing and negotiation of maintenance or service contracts, day-to-day maintenance concerns, payable processing and year-end reports, and monthly property reports (condition and financial reporting).

By working with a management company, clients gain a specialized level of expertise and experience in real estate management, in Niebur’s view. “Hiring a real estate management firm is similar to hiring a law firm or accounting firm; you are hiring the skill set of several individuals,” she says. “A real estate management company will provide the expertise in real estate so you can focus on running your core business.”

Clients also gain access to the management team’s connections with contractors and vendors.

“We vet these services thoroughly and then form relationships with chosen contractors and vendors in order to get quick responses, great service, and often better pricing from them,” says Niebur. “Because we manage a large portfolio of properties, our volume often affords us priority with vendors and service providers.”

According to Cange, hiring a management company provides a streamlined solution without the property owner dealing with the overhead of salaries, benefits, and training. In exchange for the management fee, clients access expert knowledge.

“We know the current market rates and have real estate data resources available that the general public does not. This allows us to competitively market the property and get the best ROI [return on investment] possible,” he explains. “We also have experience in lease negotiations, outlining tenant and owner responsibilities to ensure the investment is maximized.”

He notes that, unlike owning a home, many parts of building maintenance are unfamiliar to those without experience in the commercial property world. A management company can recognize areas of concern before they become costly problems, providing proactive maintenance rather than reactive responses.

Although finding good, reliable vendors can be difficult, a property management company establishes relationships with top-quality contractors.

“The vendors we use have good track records with reliable outcomes. These relationships also allow us priority over other customers, as well as flexibility with payment terms, if necessary,” says Cange. “Strong relationships with local vendors can lead to better pricing and faster service. A smart property manager often pays for him or herself through cost savings alone.”

Since a property sitting vacant is the last thing any building owner wants, property managers and real estate licensees often network with one another, simplifying the placement or referral of tenants to occupy the space. It’s also advantageous within properties managed by the same business.

“If we have a tenant who is moving out and looking for space elsewhere, we can transfer them to a unit in another building that we manage,” says Cange.

He notes that “smart” management companies also take advantage of software that is engineered for managing spaces with multiple units and tenants.

“Let me just say that QuickBooks is not geared toward property management,” he says with a laugh. “With the right software, leases can be set up such that rent increases, recoveries, renewals, and amendments are all automated to ensure the lease is executed as written to maximize the profits the owner is entitled to. Income and expenses are tracked and reported with a variety of detailed financial reports available—tailored to customer needs—and reports can be sent out to owners on a monthly basis.”

When it comes to hiring a property management company, a building owner should keep certain things in mind, according to the professionals.

“They should look at qualifications, the range of services offered (such as accounting, maintenance), fee structure, and overall industry knowledge,” says Cange. “It’s also important to find a manager who will treat your property like their own: with care, urgency, and attention to detail.”

Niebur says it’s important for building owners to ask real estate management companies about their past and current portfolios, meet with the team members, and see if the relationship fits the owners’ needs. “Understanding their background and level of involvement can give you confidence in the firm’s ability to manage your property effectively,” she notes.

It’s also important to ensure that property managers understand less-traditional issues that can affect an owner’s investment—which, in Alaska, might be a little different than in other locations.

“If anything, it’s the weather. The weather conditions here demand extra planning and responsiveness, especially when it comes to maintenance and snow management,” says Cange.

“Snowfall amounts can significantly impact budgets and, recently, structural integrity of buildings,” Niebur adds. “Our team also has to consider the potential impact of natural disasters—like earthquakes or volcanic activity—and ensure we have comprehensive emergency-preparedness plans in place to communicate with owners and tenants, and the means to quickly restore building operations.”

PTP also specializes in rural property management, which is fairly unique in Alaska. The company manages properties off the road system, which means dealing with limited services and logistics issues.

“Running a commercial property management company is as unique as each property we manage,” says Niebur. “Each property presents its own set of challenges that requires our team to problem-solve; our ability to adapt and grow has been key to delivering solutions to our clients.”

A commercial investment property operates like a business, with a focus on return on investment for the owners. Thus, Niebur says, “Ultimately, the property needs to perform and generate value. Having a reliable, professional real estate management company as part of the investment is invaluable.”