The need for real estate asset management often arises with the increase in a real estate portfolio. It is usually strenuous, if not near impossible, to monitor and maintain several properties across different locations. Hence, the reason hiring a portfolio manager is the safest means to getting the most out of your investment properties.
Real estate asset management is an unspoken rule in modern real estate investing. An unspoken rule though not written down but is generally understood. As you acquire new purchases, one investment property at a time, you would notice that it takes more time and a great dedication to take care of them.
At this point, you would need an expert hand to undertake those accompanying responsibilities typical of a substantial real estate portfolio.
However, it is paramount to note that real estate asset management is not the same as property management, nor is it similar to facility management. To know the differences between them, let’s learn about real estate asset management in detail.
What is Real Estate Asset Management?
Real estate asset management is the process of monitoring and managing a wide range of investment properties while exhausting all possibilities to increase their value and returns on investments that they deliver. It is overseeing many properties, at the same time, identifying areas of opportunities to improve their performance as investments. A person who fulfils these responsibilities is called a real estate asset manager or a portfolio manager.
A real estate asset manager may be a person or a company who handles these responsibilities and makes salient investment decisions on behalf of the property owner. Whether the owners are individuals, private companies, corporations or the government, real estate asset managers act in the best interest of their clients to improve property value and raise their income.
They are professionals in handling various investment properties from residential to commercial, mixed-use and even vacation properties. Though their role may sometimes overlap with the duties of a property manager and facility manager, they should not be confused with either of them. A real estate asset manager focuses on the financial aspects of the property while the property manager function is with the occupants/ users of the property, and the facility managers the environment.
For better understanding, what are the roles of real estate asset managers?
The Roles of a Real Estate Asset Manager
The task of a real estate asset manager begins even before the accumulation of various investment properties to create a portfolio. You may be wondering what that means. It means the job of a real estate asset manager starts at the point when you have the intention of diversifying or expanding the number of properties you have already.
To illustrate, say you have one or two investment properties, and you are ready to add maybe five more properties to that number. This moment is the time to look for a reliable real estate asset manager. A real estate asset manager at this point would help you identify investment properties that match your financial goals. Considering prerequisites such as zoning laws, demographics, neighbourhood, and taxes, he guides you to purchase only those properties that are worthwhile investments.
Perhaps, you have a real estate asset management company as your portfolio manager. They perform the same function as an individual portfolio manager. They conduct research finding ideal investment properties for you, locate them and negotiate the terms of sales on your behalf.
Other duties a real estate manager does are as follows:
- They conduct a financial analysis of your real estate assets
Conducting a financial analysis of your real estate asset is one of the primary tasks of a portfolio manager. They evaluate and examine your investment properties to determine the level of profitability of each. Performing this process on the existing properties in your portfolio and new purchases you wish to acquire, portfolio managers help you decide if they are worth your monetary investment.
Using these analyses, they make financial projections about the estimated income on different properties, offer timely investment advice, devise and suggest workable investment strategies.
- They help you create a realistic budget
Portfolio managers do not only help you devise a strategy to achieve your financial goals, but they also help you create a budget for expenses as well as future investments.
- They help you secure funding.
Maybe you require extra funds to purchase new investment properties or improve existing ones, a real estate asset manager assists you in searching for fitting fund sources that provide loans.
- They help you with market research.
Real estate asset managers carry out effective market research on investment properties you wish to purchase. They also help you investigate the profitable opportunities that would come with such investments.
- They assist with property transactions.
Assisting with property transactions is one of the core duties of a real estate asset manager. During a purchase or the sale of a property, a real estate asset manager handles the processes from start to finish on your behalf.
- They help you market your real estate assets.
Whenever you wish to sell or rent out your property, a portfolio manager enlists the help of a real estate marketing agency that would advertise your property.
Portfolio managers also collaborate with leasing agents to ensure that your investment properties are the income-generating assets they ought to be.
- They hire other professionals necessary to care for your properties.
Real estate asset managers have the responsibility of hiring other significant personnel to maintain your investment properties. They can hire a property manager and a facility manager, or either of them to ensure your properties are in good condition to serve the purpose of income generation.
- They draft Property Agreements and Leases on your behalf.
Drafting property agreements and leases are one of the duties a portfolio manager does on your behalf. Portfolio managers ensure that they draw up rental contracts and lease agreements that are satisfactory to the users and the owners of the property alike.
- They manage the cash flow from the properties in your portfolio.
Real estate asset managers ensure you have a steady cash flow. They help you identify different consistent ways to generate revenue with your property and also help you reduce your expenditures.
- They help you improve the value of the properties in your portfolio.
Real estate asset managers help you determine what upgrades would do the trick to increase the value of your properties, also improve your returns on investments.
These different duties portfolio managers perform are sufficient reasons to hire them. But who are those who need real estate management?
Who Needs Real Estate Asset Management
Seeing that anyone can benefit from having a real estate asset manager, it is untrue to say that real estate asset management is for big investors alone. So, if you need someone to perform any of these roles in maximizing your investments, you need real estate asset management. The only deciding factor then should be the cost of hiring one.
Again, asset management should not be confused with property management or facility management.
Do you require assistance with the daily management of your property? You should consider hiring a property manager instead. Do you have facility issues or require overall maintenance of your property? A facility manager is the professional you need to handle the task.
For owners who have an extensive real estate portfolio, there is a need for the services of a portfolio manager if you must enjoy higher returns on your investments.
At James Cubitt Developments, real estate asset management is part of the core services that we offer. We help you maximize the performance of real estate assets you already have. Our real estate asset management service is suitable for different investment properties and legacy real estate assets of any kind. We can administer this service on behalf of an individual, a group or a corporate organization.
For more information, get in touch with us!
Phone number:01 715 9995, 01 715 9996