Start a Property Management Business? - Posted by Rolfe Kurtyka

Posted by ken in sc on March 03, 2002 at 13:33:50:

CH is right, it is work and requires time. I like you, believe in the theory that a business should be owned so that you can walk away for a year - not hands on. Thst is my goal. I manage around 50 units for others as well as my own. It gives me some income but takes a lot of time. My goal is to build it to 150-200 units. Then, I can afford the employess needed to walk away. Ulimately I want to have the Property Management business be a business that makes me money as well as does a first rate job of managing my own houses when I am ready to really back of day to day work. I figure I have about 5 more years, but it will be worth it in the long run. It does pay for my secretary and some expenses now. I guess it really depends on your long-term plan.


Start a Property Management Business? - Posted by Rolfe Kurtyka

Posted by Rolfe Kurtyka on March 01, 2002 at 17:33:23:

I’m an investor, first and foremost.

I’m also a real estate broker. I’m considering offering property management services to clients who want to invest in real estate. Currently, I manage only my own property, totaling 10 units.

Real estate is my career. I teach investment real estate and pre-licensing education for real estate agents and appraisers. For me, brokerage was a logical extension of my career.

Should I expand this business to include property management? I’d hire or subcontract administration to a third party.

Any thoughts?


Top 10 - Starting a Property Management Business? - Posted by CH

Posted by CH on March 02, 2002 at 11:32:10:

Hi Rolfe:

Having been in the commercial and residential property management business back in the late 80?s and early 90?s, I will tell you that it is a very tough business. The property management business is a good business to have as a foundation from which to base other real estate related activities. It will provide you with the ?bread-and-butter? you need for other things depending how well you manage your time. Here are my top 10 things to think about whiling planning your new property management venture:

  1. Property management fee: Make sure you charge a fair fee that will reasonably compensate you and your staff for your time. Receiving fees that are too low over time will ?eat you alive from the inside.?

  2. Time management: Make sure you are spending your time on things that will make your business successful. The more time you waste, the less cost effective this business becomes.

  3. Owner communication: Since the owner?s are your employer?s, make sure you continually communicate with them verbally and in writing. Keep them in the loop at all times.

  4. Network: Continually network with owner?s and other property management professionals. You?ll always need new business and people that can help you execute that business

  5. Organization: This business is a very paper intensive business. Make sure your office structure is well organized.

  6. Good people: To grow your business, hiring good people will help you to become more successful than your competition, and help you to obtain higher fees.

  7. Specialize: To begin, pick an investment type in which you are very experienced to start your niche, and be focused. Have this niche become the nucleus of your property management business. It?ll be easier for you to get involved with all the players in this niche and help you grow your business. For example, if you take a magnifying glass and focus it on one target without moving it, the sun beaming through the magnifying glass will start a fire. FOCUS!

  8. Regulations: Make sure you get up to speed on all the local, state and federal regulations. For example, if you choose residential investments, Federal Fair Housing issues are HUGE.

  9. Trade organizations: Get involved with trade organizations. There is BOMA for office, ICSC for retail, and IREM and NAA for residential. These associations have professional designations that may be helpful in selling yourself to owners.

  10. Gut: Just like starting any business, you have to have the passion and persistence to make it successful. You need to believe that owner?s need your help to solve their problems.

I?ve included only some very general guidelines for you to ponder while making your decision to enter the property management field. Keep in mind, you will be entering a field where you will become an operational machine. Problems will become your life. It?s much different than the transactional side of the business that you have been doing where you are selling blue sky to investors. On the operational side, you will be down in the trenches blocking and tackling trying to achieve the goals and objectives that the transactional guys promised???..

Good Luck!


Re: Start a Property Management Business? - Posted by DanT

Posted by DanT on March 01, 2002 at 20:27:02:

I have a close friend and business associate that manages property. His issues are rarely with the tenants but with the owners. They tend to circumvent his authority at times as well as not following through on promised repairs which make my friend appear as though he lied to the tenant. Tenants rarely look at him as mearly a messenger. It just seems to make it much more difficult than it is when you are doing your own thing.
On the other hand if structured correctly up front, might be ok. DanT

Top 10 - Starting a Property Management Business? - Posted by Rolfe Kurtyka

Posted by Rolfe Kurtyka on March 02, 2002 at 16:11:20:

Thanks for that feedback, Craig.

Considering your response, I feel I’d be better off affiliating with someone else who has a property management business in place.

I’m an entrepreneur, not a manager. I currently manage only my own properties, and I can certainly see a point at which further sucess will make it difficult to do anything other than manage my own properties. I do not want to be the hands on manager of those assets forever.

My goal is to work as a real estate broker (I’m licensed) for other investors, in order to generate more capital for my own investments. I view quality property management as a strong way to get clients in the stable, sourcing property for them, and keeping those relationships as profit centers throught management.

Of course, one key will be finding the right person.

I believe Kiyosaki’s creedo; a truly successful business is one you can walk away from for a year, only to return to find a stronger business!

Thanks again, Rolfe

Great post!!! - Posted by Taylor-FL

Posted by Taylor-FL on March 02, 2002 at 12:41:54: