If you have recently invested in a large residential property because there is potential for a better-than-average ROI, there are some things you should be aware of that could significantly impact your bottom line. Yes, there is money to be made in commercial real estate and although you have invested in a large residential property, it is a commercial property, nonetheless.
It is a commercial property because it is a business venture from which you intend to make a profit. This is where so many fledgling property owners go astray and sadly, had they hired a business management team, many of the problems they were confronted with would have been virtually non-existent.
1. Focus on Legal Compliance
One of the things you may be aware of would be all those certificates of occupancy and other business licenses and insurance coverage you are required to carry. Also, you are going to be required to be compliant with state fire codes and building codes and being unaware of any pertinent codes is no excuse. Fines for noncompliance can be quite steep and if there is any loss as a result of noncompliance, you could even be put out of business.
If your building has several floors being serviced by elevators, don’t forget to contract elevator inspection services and safety compliance performance from a company like ATIS. Your county inspector will follow OSHA guidelines when inspecting your elevators, but it takes a team of pros to ensure everything is up to par before they arrive to inspect elevators and other conveyances in multi-floor residential properties.
2. Maintain Property to Avoid Mishaps
One thing your management team should do is regularly check to ensure maintenance is keeping property in clean and safe conditions. This means that all repairs should be seen to timely so as to avoid any accidents or injuries with residents and/or visitors. Even some insurance coverage could be null and void if you are not compliant, so do check to see that maintenance is doing their job.
3. Provide 24/7 Emergency Contact Information
There have been times when an emergency situation cropped up and residents had no way of contacting owners or property managers. Always make sure you’ve left an emergency contact number so that you can be reached in the event of an emergency such as a fire, flood or even an act of vandalism.
4. Deal with Resident Complaints Immediately
It is also imperative that you deal with residents’ complaints as soon as they are lodged. Those complaints could be in terms of other residents, and it could be that they’ve noticed suspicious activity on the grounds. No matter what complaint crosses your desk, it is vital that it is addressed immediately to avoid losses which could have been avoided.
5. Listen to Management and Consultants!
Many of you may remember the building collapse in Surfside, FL in June of 2021 in which a total of 98 people lost their lives. Three years prior a report was filed by an engineer who stated the building had design errors, yet nothing was done. Let this be a lesson for you as a new owner or manager of a large residential building. You’ve hired experts for a reason, so always hear what they have to say to avoid a critical situation like this.