As the name suggests, the job of an "Asset Manager" is to manage the performance of your commercial real estate asset. On a day to day basis, common tasks include:
- Vendor Oversight: Asset managers will managing key vendor relationships, including third party property managers, brokers, and service providers. In each case, they are responsible for negotiating and managing contracts, as well as communicating the property’s operational strategy. Your asset manager will also re-negotiate vendor pricing where applicable.
- Capital Planning / Budgeting: Each year, your AM will create a capital plan and operating budget. The capital plan outlines future repair and renovation projects, typically on a 1, 3, and 5 year timeline. The operating budget projects the property’s income and expenses based on market comparables.
- Budget Variance Tracking & Course Correction: Each month, your asset manager will compare your property’s actual performance against the budget. If there are significant variations, they will create a plan to get the asset back on track.
- Management of Stakeholder Relationships: Institutional grade commercial assets have a number of stakeholders, including investors, lenders, and senior level management. Your asset manager will help manage these relationships, keeping the parties informed about your property’s performance.
- Market Monitoring: Each month, your asset manager will monitor market conditions to ensure your property's rents are in line with market comparables.
- Workouts: If asset performance degrades, your asset manager will play a key role in creating a “workout plan” for lenders and investors to preserve the property’s value.
- Dispositions: When it comes time to sell a property, your asset manager will play a key role in hiring a brokerage firm, negotiating the sales price, and formulating the sales/marketing strategy.
- New Projects: When you have a new deal, your asset manager can contribute to rent roll and operating due diligence.
When do you need to hire an asset manager?
The first asset management hire usually comes when a firm's principals realize they can’t do it all. There is no set size for this, but we typically see it after the purchase of 3-5 institutional-grade assets. As the firm continues to grow, it may need to hire several asset managers.
What differentiates a good asset manager from a great one?
While every individual and job is unique, there are several qualities and characteristics that set a good asset manager apart from a great one.
- Experience: The best have experience managing different asset types through various economic conditions.
- Credentials & Certifications: Top credentials include: MBA, Masters in Real Estate, and CCIM.
- Quantitative Skills: Great asset managers are highly skilled with cash flow modeling tools, like Excel or Argus.
- Detail Oriented: Details matter, and the best asset managers pay close attention to them. They always tie out their calculations, double check their work, and “sanity check” their models.
- Collaborative: Great asset managers understand that it takes a team to run a commercial property. They actively seek to collaborate with others. They are open minded and can give/receive constructive feedback.
- Communication: Above all else, great asset managers are excellent communicators. They keep all stakeholders informed about the property’s status, promptly report major issues, and actively build relationships with team members and co-workers at all levels of the organization.
Where can you hire an asset manager?
As the commercial real estate industry grows, demand for top talent is increasingly competitive, which can make hiring an asset manager a challenge.
That’s where Bullpen comes in. We help commercial real estate acquisitions and development firms find and hire the best freelance asset managers in the industry. We pre-screen the candidates, verify their experience, and handpick the best talent for your hiring needs.
