Industrial Property Management Chapter 13

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Questions and Answers

Match the types of buildings with their definitions:

General Purpose Buildings = Designed for multiple uses Special Purpose Buildings = Built for a specific industry/function Single Purpose Buildings = Intended for a single tenant's use Multi-Tenant Buildings = Serves multiple tenants under one roof

Match the industrial property management concepts with their descriptions:

Industrial Park = A planned area with multiple industrial properties Foreign Trade Zones = Designated areas for duty-exempt trade Escalation Clause = Provision for rent adjustments over time Resource Oriented Industries = Industries tied to natural resources

Match the types of analyses used in management planning:

Regional Analysis = Assessment of larger geographic influences Neighborhood Analysis = Study of local environmental effects Market Analysis = Evaluation of supply and demand dynamics Property Analysis = Examination of specific property features

Match the leasing concepts with their functions:

Leasing Agents = Facilitate tenant recruitment and property listings Negotiations = Discussions to finalize lease terms Prequalifying Tenants = Assessing prospective tenants' suitability Lease Provisions = Specific terms included in rental agreements Signup and view all the answers

Match the following features of industrial property listings with their typical content:

Ceiling height = Standard measurement included Loading facilities = Information on logistics Previous tenant's business = Details on former operations Square footage = Area measurement Signup and view all the answers

Match the reason for a manager's special reporting with the event:

Changes in property tax rates = Financial adjustments Discovery of environmental damage = Liability concerns New pass-through charges for maintenance = Cost changes Theft or other crime = Security issues Signup and view all the answers

Match the operations in industrial property management with their responsibilities:

Maintenance = Ensuring property functionality Security = Protecting property and personnel Reports to Owner = Providing updates on property performance Marketing Industrial Property = Promoting properties to prospective tenants Signup and view all the answers

Match the reasons why industrial leases are typically long-term with their explanations:

Difficult replacement tenant = Specialized property challenge Finding similar properties hard = Tenants’ limitations Owner's serious upgrades = Long-term investment strategy Large expensive equipment = Tenant's investment concern Signup and view all the answers

Match the types of property transactions with their definitions:

Ground lease = Long-term land rental Sale-leaseback = Sale followed by lease Straw-man transaction = Concealed party involvement 1031 exchange = Tax-deferred property swap Signup and view all the answers

Match the types of industries with their location requirements:

Market oriented industry = Near customers Utility-intensive industry = Inexpensive utilities Resource-driven industry = Natural resources Transport-dependent industry = Transportation infrastructure Signup and view all the answers

Match the antitrust concepts with their definitions:

Sherman Act = Legislation that prohibits monopolies Conspiracy = Agreement among parties to reduce competition Price fixing = Setting prices at a certain level by agreement Market allocation = Division of markets among competitors Signup and view all the answers

Match the disclosure laws with their descriptions:

Latent defects = Hidden issues not discoverable by inspection Megan’s Law = Law requiring registration of sex offenders Lead-based paint = Disclosure requirement for properties built before 1978 General agency law = Duty of good faith in property management Signup and view all the answers

Match the terms related to property disclosures with their characteristics:

Material fact = Fact influencing tenant's rental decision Written disclosure = Not typically required but advisable Known latent defect = Failure to disclose may lead to liability Prospective tenants = Individuals considering renting a property Signup and view all the answers

Match the specific disclosures with their relevant laws:

Lead-based paint = Federal requirement for older properties Megan’s Law = Public access to registered sex offenders Latent defects = Duty under general agency law Price fixing = Violation of antitrust legislation Signup and view all the answers

Match the parties involved in property management with their roles:

Property manager = Responsible for tenant interactions Tenants = Individuals renting the property Landlords = Ownership entities of the property Regulatory agencies = Oversee adherence to laws Signup and view all the answers

Match the following types of tenant screening laws with their description:

Fair Credit Reporting Act = Improves accuracy of collected information and protects privacy USA Patriot Act = Involves inquiry into citizenship status State tenant screening laws = Governs tenant screening procedures at the state level Criminal background check = Evaluates a prospective tenant's criminal history Signup and view all the answers

Match the following types of property conditions with their concerns:

History of flooding = Indicates property may be in a flood zone Ongoing mold problems = Potential health risks for tenants Indoor air quality testing = Measures pollutants in living spaces Groundwater testing = Assesses contamination risks in soil and water Signup and view all the answers

Match the following disclosure laws with their focus:

Material fact = Any significant information affecting property value Latent defect = Hidden problems that affect property use Megan's Law = Requires disclosure of sex offenders in the area Lead-based paint = Mandatory disclosure for homes built before 1978 Signup and view all the answers

Match the following tenant screening requirements with their aspects:

Credit history = Assessment of financial reliability Employment verification = Checks current job status and income Rental history report = Provides past rental experiences Criminal background check = Investigates past criminal offenses Signup and view all the answers

Match the following elements of a tenant application with their purposes:

Disclosure of investigation = Informs tenant of credit and background check Signature acknowledgement = Confirms tenant's consent to screening Written disclosure = Legal requirement for transparency Application form = Collects essential information from prospective tenant Signup and view all the answers

Study Notes

Learning Objectives

Students will be able to compare general-purpose, special-purpose, and single-purpose buildings.
Students will be able to define an industrial park.
Students will be able to discuss the importance of tax rates in managing industrial property.
Students will be able to define foreign trade zones and their impact on industrial property.
Students will be able to contrast resource-oriented industries with footloose industries.
Students will be able to explain the role of industrial brokers in the leasing process.
Students will be able to discuss the importance of an escalation clause in an industrial lease.
Students will be able to identify operations and reporting issues unique to industrial property management.

Suggested Lesson Plan

Students should review the previous chapter on retail property management using Exercise 13.1.
Review Chapter 13 and its learning objectives.
Review the suggested lesson plan for managing industrial properties

Types of Industrial Property

Industrial property is used for production, storage, and distribution of products.
Use can be classified by building use (general purpose, special purpose, or single purpose), by tenancy (single or multi-tenant), and by location (free-standing or industrial park)
Industrial properties can be categorized into different types depending on the use of the facility (e.g.; production, storage, etc. )
Industrial properties can be single or multi-tenant.
Industrial parks are pre-planned developments containing industrial buildings (and sometimes office buildings).

Management Planning for Industrial Property

Sources of data include business news, publications, Chambers of Commerce, and trade associations.
Regional analysis considers demographics, economic conditions, transportation, utilities, tax rates, and incentives.
Transportation includes roads, airports, ports, and railroads.
Regional factors need to be analyzed for successful management planning for a local area.

Marketing Industrial Property

Leasing agents, often called industrial brokers, specialize in marketing and leasing industrial properties.
Listings typically include location, photos, and basic property facts.
Prospective tenants should be pre-qualified to assess their ability to pay rent and business operations.
Prequalification is an important factor for successful lease negotiations.

Leasing Industrial Properties

Leasing teams should include the broker, property manager, owner, accountant, and potentially an environmental expert.
Important lease provisions include lease term, rent and pass-throughs, use restrictions, inspections, insurance, and environmental matters.
Lease terms often are for a significant number of years to help recoup investments.
Lease provisions should address details such as security, maintenance, rent, and pass-throughs.
Lease provisions are important in protecting both the landlord and tenant.

Operations and Reporting

Maintenance responsibilities vary based on property type (multi-tenant or single-tenant).
Security is crucial; industrial settings are frequently targets for theft.
Reporting obligations to the owner regarding maintenance, environmental incidents, or other problems.
Managers must report to owners on property issues, such as environmental damage and maintenance.

Types of Industry

Industries can be classified as labor intensive, resource oriented, energy oriented, transportation oriented, and market oriented.
Industries are often categorized by their key factors (labor, resources, energy, transportation, or market demand).

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Description

This quiz focuses on Chapter 13 of industrial property management, where students will explore the key concepts of different types of industrial buildings and their management. Topics include industrial parks, tax rates, foreign trade zones, and the unique aspects of industrial property leasing. Assess your understanding of these crucial topics to enhance your knowledge in industrial property management.