Property management firms enjoy brighter days

Source: The Business Journal
Written by Chuck Harvey

Property management took a blow during the real estate crash, but has since been a steady income business for specialists like Manco Abbott and Robert L. Jensen & Associates as the rental housing, office and retail market bounces back. After 26 years in the same location, Manco Abbott will move its operations in late September from 6051 N Fresno St. in Fresno to a new energy-efficient building being developed near Herndon and Fruit avenues in Fresno. Ginder Development Corp. is developing the business park where Manco Abbott will be situated. Manco’s offices will occupy 11,000 square feet of the 20,500 square foot building. Leases are being negotiated for the remainder of the building, which is flanked by offices of Bonadelle Development Corp. to the west and Granville Homes to the east. Robert L. Jensen & Associates is another growth story in the property management business. The company’s residential division manages 28 community associations. The largest is a 2,258-unit master association. The commercial division manages ten multi-story office buildings, the largest of which is a 100,000 square-foot complex. Robert L. Jensen has 58 employees and manages 15.1 million square feet of apartments and commercial buildings. Jensen said his business is doing well and he has been able to keep his employee numbers steady. He said construction in the Valley has been pretty low, but there has been some activity. And new buildings coming on line help fuel growth in the property management business, he said. Property management services fell off some following the collapse of the real estate market in 2007. However, since then the Valley has seen resurgence in commercial and retail building leases along with strong growth in the apartment and rental housing markets. The top 10 property managers in the central San Joaquin Valley managed 657.2 million square feet of properties in 2009. By 2013, the number had grown to 703.5 million square feet, according to information provided by the companies for The Business Journal’s annual Book of Lists. As home foreclosures grew, more people moved into apartments and rental homes. That boosted demand for property management firms to handle the expanding rental market. “Our business is starting to grow,” said Michael Goldfarb, chief operating officer of Manco Abbott. “There was a slow time in 2008 and 2009, but business was better in 2011,” he said. A growing rental housing business boosted Manco Abbott’s business further. “The apartment sector is doing well,” Goldfarb said. “It helped us.” He said the office market is starting to come back and as vacancies get filled, it will help property management companies. Most retail activity has been in Visalia and Dinuba, Goldfarb said. Although new retail construction has picked up some, most of the recent growth in property management has been in rental housing. “We have seen some growth,” said Terry Fox, owner of Fox Property Management. His company recently picked up about 100 single-family units. Fox’s portfolio is single-family homes and small apartments. Fox Property Management currently has 12 employees. As a small company, it is doing very well, Fox added. It has 9.8 million square feet of residential and commercial buildings that it manages. Overall, Fresno has 473 units of rental housing under construction or renovation, according to the Fresno Housing Authority. It has 345 units of rental housing in development and construction. The largest is Parc Grove Commons South at Clinton Avenue and Fresno Street, with 215 units of family housing under construction. With more apartments being built in Fresno, property management firms should see continued opportunities. They will also see challenges as home prices rise and some rental housing owners put single-family rental homes up for sale. Still property management growth is expected at least in the near term. Both developers and real estate companies have found property management to be a profitable sideline. Membership in the National Association of Residential Property Managers nearly doubled following the real estate market collapse. The U.S. Census Bureau reports that renter household formation surpassed new owner-occupied homes in 2007 and has held the lead since then. That is in response to more people wanting to rent homes than buy them. IBISWorld.com a global business intelligence specialist providing procurement and purchasing research reports, reports that declining home ownership will continue to support property management industry growth though 2018. Hiring professional management has become more attractive as regulations governing landlords becomes more complex. And once rental prices start rising, it will make property management more affordable and attractive. In rental housing, property managers handle tasks like screening tenants, helping determine rents, resolving disputes and handling landscape maintenance. Manco Abbott has an IT department that helps monitor the systems that provide tenants and residents with rapid response to maintenance requests, accounting questions or any other issues that arise. Its technology-enabled services, including online work orders and rent payment with Manco Connect, help speed information to its customers. Additionally, the majority of the property management team uses iPads for access to real-time data from any location. Manco Abbott oversees nearly 200 properties including apartment communities, office buildings, shopping centers and industrial properties. The firm's services span 10 counties from the San Joaquin Valley to the Central Coast and includes a Monterey branch. Founded in 1972 the company has approximately 150 employees. Along with rental housing, retail leases have also been growing, leading to more opportunities for property management. ShoppingCenterBusiness.com reports that new tenants are turning the once-dark vacancies into new opportunities. That has also helped the property management companies. Real estate giants like Lance Kashian & Co. and Colliers International have made property management part of their lineup of services. For commercial buildings, services include support of a building’s operations, physical maintenance, tenant relations, accounting, leasing and marketing and sales.

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 For further information on Fresno Real Estate check: http://www.londonproperties.com