With Management More Vital Than Ever, Panattoni Taps Colliers for 18 MSF Contract
- Feb 04, 2009
With a struggling economy dragging down the commercial real estate market, selecting the right property management team may be more important than ever. And now Panattoni Development Co. has expressed a major vote of confidence in Colliers International, tapping the firm to provide management services to some 18 million square feet of office and industrial property located across the country. The properties are sited in 10 major U.S. markets: Atlanta, Chicago, Dallas, Denver, Indianapolis, Memphis, Nashville, New Jersey, St. Louis and Tampa Bay.The assignment represents one-half of Panattoni’s 36 million square-foot office and industrial portfolio in the United States, and brings Colliers’ total square feet under management for all clients to over 886 million square feet around the world.And that experience plays a key role in providing quality property management, Reggie Mullins, vice president of commercial management for Washington, D.C,-based Cafritz Co. and immediate past president of the Institute of Real Estate Management, told CPN. “Everyone is looking to do things cheaper and better in this economy,” Mullins said. “You have to understand your buildings. A professional who has been around will understand what is going on and may have been through the cycle before. What you really need to do is get back to the basics,” she noted. “Amateur hour is over. Building owners need a professional who understands the basics and can go through line-items on expenses and maximize income while minimizing expense.” Mullins said simple things like looking at electrical usage in a smart way while working with tenants may be one solution. “With younger tenants, in particular, they want to go green, but sometimes it is more expensive, so they look at it more as a social responsibility rather than ‘what we can save.’ So, there is a fine balance there,” Mullins said. “it could also be something like instead of doing a full window cleaning in a building four times a year, we’ll cut down to two times a year.” Another way an experienced property manager may help both tenants and landlords is knowing when to work with a tenant. “A newer manager might not have been through a real estate cycle and know how to work with a tenant. Let’s say the tenant is an advertising firm and their billings have slowed because of the economy,” she explained. “A manager that has been there before may be able to work with them on a payment schedule, whereas a new manager may go immediately to putting them into default and evict them. In that case, you’re not doing the best thing you can for the owner in this economy. Do you want to give them a vacant space where vacancies are staying longer on the market? There are a lot more concessions being given that you might be better off working out a payment plan with a tenant that is in place already.” Colliers International is a global affiliation of independently owned commercial real estate firms. The organization’s 11,000 employees span the world in 293 offices in 61 countries. On a worldwide basis, Colliers manages more than 888 million square feet and has revenue of $2 billion. Panattoni is a privately held full service development company founded in 1986 and is one of the country’s largest developers. Previously, the firm handled the portfolio’s real estate management services internally.