Management riding two horses
Condominium property management companies manage condo corporations.
However some PMCs also manage rental units for individual owners and
some are also managing short-term rental units for individual investors.
|Del Property Management
|condominium property management
|Del Condominium Rentals
|manages rental units owned by
|manages short-term rental units
In this case, the four revenue streams are split into different profit
centres but they can be found within the same condo corporation.
What is becoming more common is for a condo management company to
manage the condo corporation plus rental units, student housing units
and short-term rental units sometimes in the same corporation.
Here are some Tweets from the owners of one Toronto-based condo
management company who is trying to grow his business:
A guide to student rental property
If your residential property management company is located near a
college or university, it’s likely that the prospect of renting to
students will come up eventually. As a property manager, the idea of
renting to college students can seem daunting as the risk of getting
your property back in worse shape than before seems more likely.
However, equipped with the necessary knowledge and precaution, renting
to students can be a beneficial, lucrative niche for your rental
property management business.
Of all the above Tweets, and links from those Tweets, the most
informative one is from the 6 Reasons ... as it shows the stark difference in
attitudes between condo owner-residents and investors:
exempt themselves from the daily grind and responsibilities and focus
more on the business and profit making part. No need worrying how to
make a plumber show up on Sunday afternoon. An investor would focus on
constant research and smart decision-making.
To do this requires hiring a property
management company (PMC) to advertise, negotiate with clients, maintain
and generally oversee property and assets on her behalf.
2. Investors have the benefit of
Investors focus on one thing, and
this increases their profit in the long-term and also in the
short-term, depending on how quickly they can make a property more
3. Investors avoid indigent tenants.
An investor can’t be bothered by such
challenges. The firm manages all of that and reports to her. And in the event that a property is not profitable,
she can sell it, and move on to better investments.
4. The better end of asset appreciation.
The valuation of property tends to
increase over the years as the net operating income of the same
property augments as a result of increase in rent and reduction in the maintenance cost.
The latter is assured through effective property management work.
Investors need only to find the best management firm they can.
5. Investors are in it for the money.
To be a real estate investor, you only
need to have business at the forefront of your mind. You buy an asset with the intention to offload
such property for good profit as soon as it is profitable.
have no sentimental attachments to properties—as selling it
doesn’t mean losing their home—as is the case of many landlords.
This condo property management company, along with others, is
aggressively seeking to manage individual rental condo units. If they
manage rental units in condos where they don't manage the corporation,
there is no conflict of interests.
However, if they manage rental units in the same corporations where
they are under contract, I see the potential for far too many
conflicting interests which could include:
|using the rental proxies to
influence elections for the board of directors.
|promote policies that would
favour rental properties over the owner-residential units.
|using the corporation's
employees and/or contractors to do work in or for the rental properties.
|using the corporation's assets
to assist in the leasing and maintaining the rental properties.
|ignoring complaints about the
tenants' bad behaviours and ignoring over-crowded units.
|allowing or ignoring issues with
|using their management position
to solicit rental unit contracts.
Some of these abuses of position occurred when rental companies and
owners with multiple units controlled boards of directors so why would
it be different with property management companies?
Board of directors should write in their management contract for their
existing and future management companies that the company and any
affiliated companies are not allowed to manage any individual units
with in the condo corporation.
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