Why do we still call it “property management?”

 

I’ve always liked property managers. They tend to be friendly and collegial, always fun to spend time with at a client meeting or industry conference. But in addition to liking them, I’ve developed a huge respect for them over the years of learning what they actually do—and what their customers on both ends of the value chain expect from them.

A few weeks ago, when we published The Most Valuable Skills for a CRE Property Manager, I mused on LinkedIn that I wish property management had been on my career radar screen way back when. The guide—which is helpful for anyone looking to stand out in the field of managing commercial real estate—describes a role that is challenging, multifaceted, and tremendously impactful on a lot of people.

The thing is, I’m not sure the name “property management” truly reflects the reality of what the job is all about. Anyone who does it knows that it is much, much more than simply keeping the lights on and the HVAC running— responsibilities that are anything but easy, themselves. What’s more, the name “property management” is not only incompletely descriptive, it really isn’t the sexiest name for a field desperate to attract talent.

Sometimes I wonder what might have been if, two decades ago, I had understood what property management is really all about. Maybe, like the mixed-use development, the field of property management could use a rebrand.

Here are three ideas:

  1. Real Estate Business Management

One of the appealing things about managing commercial buildings is that each property acts as its own business, complete with a budget, customers, and profit/loss responsibility. Certainly it requires specific technical knowledge, but general business sense is crucial. This includes the financial acumen to understand the impact of spending decisions, the customer service savvy to keep tenants happy, the knack for making good decisions with available data, and more. The term Real Estate Business Management gets at this. If more early-career professionals knew that running a commercial building would give them an immediate opportunity to stretch these skills, the profession would be more popular.

  1. Real Asset Operations

The key to a commercial building is that it is a financial asset to somebody. The industry already has a term for “Asset Management” that refers to increasing the value of buildings on behalf of investors. What property managers do is to continuously add value through operational performance. Real Asset Operations carries the right connotation for thinking about buildings in terms of value.

While the word “management” may imply simply maintaining the status quo, the truth is that value is never really static. If you are overseeing operations at a building, you are (or should be) either adding to its value or aggressively defending it. That’s more than management.

  1. Workplace Solutions

Of course, if a building is an asset on the one hand, it is also a workplace on the other. Perhaps it used to be that property management didn’t need to worry too much about this aspect. They had to serve tenants, but these tenants were typically in the same kind of commoditized space. But that is no longer the case.

As BOMA International Chair Brian Harnitiaux said recently, the modern workplace is not just a place to do a job, but a tool for occupants to attract and retain talent. It is becoming more and more important for the function of property management to deliver Workplace Solutions. This encompasses making the building a desirable place to be while incorporating features and programming to help tenants collaborate and innovate effectively.

These are my suggestions, but there could be other, better ones out there that more accurately encapsulate all that running commercial buildings involves. If you’ve got ideas, let us know! We’d love to hear them.