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Posted by Marjean Pountain, CPM® on Saturday, October 13, 2012

Location! Location! Location! is True in Property Management, Too

The old real estate adage about “location! location! location!” is particularly true when it comes to property management. Property managers and facility managers need to get to know their properties inside and out to effectively do their jobs, and there are a number of location-specific variables that impact the learning process.

Climate

Climatic conditions are a major factor in priorities established by a property manager. This is especially true in the Midwest, where long and arduous winters have tremendous impacts on the operations and financial state of investment real estate. It is difficult to predict the amount and duration of snowfall and severe cold events, even for our weather experts. Budgeting for snow removal, as well as heating costs is a challenge. Sometimes you win, sometimes not. A savvy manager works with averages. Generally in three- to five-year time-frames, the highs and lows of mild and severe winters average to a baseline budget number.

Snow plowing methods and contracts are subjects in which property managers in the Midwest must excel. Full service, one-price-for-the-season-contracts, regardless of the weather, provide the best ease in budgeting, but may be deemed too pricey by some investors. Time and materials contracts, based on the hours expended in plowing and salting, are favored by many as you get what you pay for. Other methods include calculation of payment based on how many inches fall in a given time period.

As an expert often called on to handle cases involving premise liability and slip-and-fall cases involving snow and ice, I can attest to the fact there are oftentimes pros and cons to all of methods. Precipitation varies widely from rain to sleet to snow. Even snow can be light and powdery, or wet and as heavy as concrete. As temperatures warm during the day, thawing the snow and generating liquid runoff, followed by temperatures plunging below freezing overnight, the most dangerous of slippery conditions can and will occur in the most inconvenient or unlikely places without so much as a drop or flake of additional precipitation falling from the sky. Landscaping goes dormant in the Midwest, leaving property managers the time to devote to maintaining pedestrian and vehicle trafficked areas instead.

Roof maintenance is a more challenging process in the Midwest as well, where the same freeze thaw conditions cause snow on roofs to thaw, refreeze, creeping under shingles and causing ice dams to form in valleys and in gutters. The results may be icicles, sagging gutters, roof deterioration, and leaks where one least expects them, in roofs nowhere near their life expectancies. Conversely earthquakes and hurricanes are weather events we do not anticipate in the Midwest, not having the expensive construction expense associated with building to withstand such disasters. We do have tornadoes, however, and other unusual freak windstorms, random and totally unpredictable in demolishing all or part of one property while leaving the ones on either side intact and untouched.

Indigenous Insects

Insect infestations are less of a problem in the Midwest and other northern states. Most of our bugs are less invasive and damaging to buildings and our tenants. Our pesky mosquitoes require maintenance of window screens, and open air living and dining is more challenging and less appealing most of the year than in southern states. Unfortunately the bedbug has now found its way to the Midwest, generating new headaches and expenses heretofore not experienced on the scale now found to be the case.

Midwest property owners generally face less environmental issues and restrictions in property sale transactions and other matters that affect real estate. Midwestern conservatism and the fact we are generally behind new trends and practices that usually are born on the coasts and spread inland give us time to prepare and react. We are thus able to learn from experience and knowledge gained beforehand from our brethren who pioneer in dealing with such new challenges.

Having been born and raised in Wisconsin, which is in the heart of the Midwest, I have learned to specialize as an expert in real estate issues that are unique and often are at the heart of legal and insurance matters where expertise is needed. I am happy to provide consulting on such matters in which I can be of assistance in determining best practice and standards of care associated with real estate facility and property management in the Midwestern environment.


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