Property managers (or PMs) work for property owners, and are a layer between the property owner and a tenant.
Every property requires a property manager. Property managers collect the rent, and generally deal with the admin of owning a property on behalf of a property owner.
Because of this, it is easy for tenants to sometimes confuse property managers with property funds/owners.
Certain property owners choose to outsource property management of some or all properties in their portfolio to specialist third parties (for example, in South Africa, Fortress, Emira, Investec, Attacq). Others choose to perform property management in-house (for example Dipula, Barrow, Growthpoint, Redefine).
Workers in property managers can have the following titles
- Property manager
- Leasing consultant
- Property administrator
Property manager fees are charged on one, or a combination of, the below:
- According to a negotiated value of assets under management (with more management-intensive properties attracting a higher charge)
- On a transaction basis per lease renewal or new lease concluded
Further complicating this for industry outsiders…
Organisations which perform the role of property management (for specific property owners), leveraging off their commercial real estate intellectual property, can operate additional divisions – such as corporate real estate services, valuations and broking.
A broking division or brokerage, represented by brokers, is not aligned to any specific property fund, and earns their revenues from broking leasing deals (this explains how leasing commissions are earned). Thus, to a tenant, it may appear that a broker or property manager owns the properties. In reality, the massive majority of brokers do not own properties, and neither do most (outsourced) property managers.
Individual property managers generally are contracted to work for a specific property owner / property fund.
Brokerages are independent. Thus, brokerages can engage with any landlord. Further, in South Africa, unlike residential property, brokerages do not need mandates to connect tenants with space to let.
Therefore, in the overwhelming majority of cases, any brokerage can introduce you to any vacant space. (For more info on selecting the right broker, see the 4 skills required of good brokers)