Before you can answer the question, “How is my property performing?” you need to ask a few questions. An understanding of property performance is rooted in operational data that is documented, visible, and accessible. However, collecting and managing this data can often feel like searching for the Holy Grail, and wholly fail.
To satisfy and attract investors and tenants, develop easily consumed data around the areas of operations you should have insight into. But first, figure out what those areas are.
Here are the 5 questions about operational metrics you should ask:
Besides the obvious and easy to identify occupancy and retention/renewal numbers, how do you understand underlying indicators such as Tenant satisfaction?
This may encompass accessing and assessing information around your property’s:
- Management team
- Services performed
- Quality of the environment
- History of tenant activities and interactions
How do you assess and understand whether your management team is properly managing operational risk?
Assess your property’s level of:
- Planning and documentation processes for access to information from any location
- Information organization to ensure the ability to defend in the event of a legal matter
- Active certificates of insurance for all tenants and service providers
- Compliance with all life safety requirements (code compliance, inspections, documentation, etc.)
- Reduced insurance costs through a pro-active risk management program
How well is my asset and the equipment being maintained?
Your operational data should reveal that:
- Maintenance is documented
- Access to that information is easily available
- Capital planning is associated with maintenance activities
- The long-term capital effects of deferred maintenance are known
- There is NNN tenant compliance with maintenance requirements
- There is a noticeable reduction in energy costs with increased scheduled/preventive maintenance
- The amount of work performed by on-staff personal vs. outsourced service providers is documented
How do I receive information on the operational performance of my property?
Ensure that there is:
- Consistency and a standard format
- Frequency of information
- Enough information at a high level to clearly show the data that matters
How is one property comparatively performing in key areas?
Analyze how a property is performing in comparison to:
- Other properties in the management portfolio
- Other like-properties using a similar system
- Internally set targets of performance, including ownership target objectives
- Accepted industry standards
To hear an owner and investor’s perspective on the Metrics That Matter, sign up for a free webinar!
Date: Tuesday, October 25th, 12:00pm – 1:00pm EST