Common area maintenance (CAM) charges are part of most commercial leases these days. The landlord and/or the property manager create a budget for the property before the start of each new year. The tenant is then charged their pro rata share of the annual operating budget each month. After the year is over, the manager reconciles the budget with the actual expenses. If there is a shortfall, the manager bills the tenant based on its pro rata share of that shortfall. Conversely, if there is a credit, it means that the tenant was overcharged and as a result, the manager credits the tenant. Sometimes, however, a simple lack of oversight or negligence by the property manager regarding CAM charges can result in large problems between an owner and tenant. A good example of this is a retail property in Omaha, Nebraska we took over a few months ago.  As part of our transition process from the previous manager, we visited all of the tenants to discuss pending issues, complaints or any suggestions pertaining to their enjoyment of the property. One tenant told us that he had received an abnormally high CAM reconciliation charge, and had been trying for some time to get answers from the previous manager. After immediately researching the files, we noticed that the previous property manager had been billing this tenant based on an old budget. In other words, the previous property manager simply neglected to make a minor change in their software, and was therefore under-billing the tenant. After further research, we discovered that this was true of all tenants at this property. This was a careless error that led to problems for both the tenant and the Landlord. While the owner of the property understood that this was an error by the previous property manager, unfortunately the tenant still owed the money. The problem for the tenant was that he had not been able to properly budget for the abnormally large CAM reconciliation charge, and therefore could not afford to pay it all at once. We helped facilitate a payment plan that was satisfactory for both owner and tenant to try to navigate the situation.  Unfortunately for our owner, he had to wait several more months to collect CAM charges that should have been already paid. He also faced the risk that that if the tenants ran into hardship, and were unable to pay their rent, current CAM and reconciliation charges, he could potentially never collect these funds that should have been already collected. Obviously businesses today are forced to deal with many financial uncertainties and hardships, but this is certainly one that could have been easily avoided. Landlords and tenants rely heavily upon their property managers taking great care and properly managing the accounting of a property. Here at Terrahawk Group, we take this trust very seriously. When the property manager fails to do so, it is bad for the tenant and the landlord. ...read more

In today's world, there are plenty of opportunities for companies to set themselves apart from their competition. This week, we had the opportunity to witness both ends of this spectrum. One company illustrated beautifully why they will always be at the top of our minds whenever a roofing issue presents itself. The other company displayed why we will never recommend them to anyone needing property or casualty insurance. When building a business on the principles of service and communication, as we do in property management, we are promising our clients an experience they are unlikely to find elsewhere. For a particular condominium complex, due to negligence and deferred maintenance from a previous property manager, solving their many issues was challenging from the outset. Multiple roofing leaks, a collapsing wall due to shoddy workmanship and a broken pipe in a common wall were just a few of the issues we inherited. Nevertheless, we promised the association we'd stay on these issues and make their homes happy places to live once again. Imagine our surprise, then, when after two months and two insurance claims, we still hadn't spoken with the association's insurance agent. Several calls went unreturned and no one from the agent's office assisted with the two inspections. In fact, only after leaving the agent a message stating that the association was taking its business elsewhere did we finally hear the agent's voice and willingness to help out. During this process, we also contacted multiple roofing contractors to examine the property. More than one didn't return calls and one even failed to show up for a site meeting we had scheduled with them! In property management, the contractors you work with can make you look really bad or really great. Fortunately for us, we found a roofing contractor who has consistently made us look great. They return all calls promptly, they show up early to every meeting, and they present comprehensive analyses for every property at no additional charge. Further, they take a personal interest in solving the issues and they work to teach us about the many options for tackling the repairs. Of course, they aren't going to get every job we present to them, but guess who will be at the top of the list when a problem does occur? For us, meeting this roofing contractor was like looking in the mirror. We both recognize that communication is essential. We both recognize how important it is to really care about your clients. And we both recognize that if you separate yourself from your competition, people will appreciate the intangibles and reward you with their business and their trust. ...read more

If you missed Gary Vaynerchuck's keynote speech at Big Omaha, you missed something special.  Shirt untucked, electric, almost frantic, Gary's passion about everything he talks about leaps out and hits you over the head.  Repeatedly.  Imagine your best friend after several drinks.  The energy.  The foul language.  But you get it all.  If you missed it live, luckily, you can still watch it online. Gary is in the wine business, but it's obvious he could be successful at anything he wanted to do.  He's one of the most inspiring people you'll hear.  And the most valuable advice from Gary's Big Omaha speech is also the most obvious: "You want a good business strategy no matter what you do?  It's unstoppable: CARE.  That's it.  You're welcome." Does your property manager care?  Do your tenants feel like your property manager cares? You can learn how to organize and schedule lawn care, snow removal and window washing.  You can learn how to get bids for repairs and negotiate pricing.  You can learn how to collect rent and pay bills on time.  But you can't learn how to care. Property managers who care take the time to think about people.  They treat your tenants like friends.  They don't just change a light bulb, they ask how the tenant is doing.  They don't just rush through an inspection, they look for opportunities to make improvements.  They find solutions to problems that you haven't even realized existed. When it's time for your tenant to renew their lease, it's too late to ask them if your property manager cared about them. ...read more