Podcast
Questions and Answers
What is a common characteristic of security measures in a suburban office park?
What is a common characteristic of security measures in a suburban office park?
- Mandatory security training for tenants
- Use of a security firm for periodic patrols (correct)
- Full-time surveillance systems in place
- Constant presence of on-site security staff
In property management, what might indicate functional obsolescence?
In property management, what might indicate functional obsolescence?
- Inadequate electrical systems for current needs (correct)
- Low property maintenance costs
- High levels of tenant satisfaction
- Updated telecommunications infrastructure
What is the purpose of a tenant improvement allowance?
What is the purpose of a tenant improvement allowance?
- To allow landlords to charge more rent after improvements
- To cover all costs of tenant renovations
- To set a maximum limit for landlord contributions to tenant build-outs (correct)
- To exempt tenants from maintenance obligations
Which aspect is not typically included in a regular rent roll?
Which aspect is not typically included in a regular rent roll?
What does analysis of alternatives assess regarding building improvements?
What does analysis of alternatives assess regarding building improvements?
What is most likely true for a small office building with little foot traffic from tenants’ customers?
What is most likely true for a small office building with little foot traffic from tenants’ customers?
Which item is typically not included in a rent roll prepared for an office building owner?
Which item is typically not included in a rent roll prepared for an office building owner?
Where would a company most likely locate if it needs both office space and a warehouse?
Where would a company most likely locate if it needs both office space and a warehouse?
Janet's building lacks sufficient electrical outlets and internet connectivity for tech firms. This concern is categorized as:
Janet's building lacks sufficient electrical outlets and internet connectivity for tech firms. This concern is categorized as:
What type of analysis is Janet conducting when evaluating the cost-effectiveness of upgrading telecommunications infrastructure?
What type of analysis is Janet conducting when evaluating the cost-effectiveness of upgrading telecommunications infrastructure?
Which organization provides an online resource detailing features and rents for thousands of buildings nationwide?
Which organization provides an online resource detailing features and rents for thousands of buildings nationwide?
What is it called when a building's owner agrees to contribute a specific amount to a new tenant's build-out costs?
What is it called when a building's owner agrees to contribute a specific amount to a new tenant's build-out costs?
Which of the following would not typically be part of a property analysis?
Which of the following would not typically be part of a property analysis?
In which area were office buildings heavily concentrated in the early twentieth century?
In which area were office buildings heavily concentrated in the early twentieth century?
Which option best describes a Class A office building?
Which option best describes a Class A office building?
What analysis is the manager performing when studying economic data on the legal sector?
What analysis is the manager performing when studying economic data on the legal sector?
If a comparable property has a parking garage and yours only has on-street parking, how should you adjust the rental rate?
If a comparable property has a parking garage and yours only has on-street parking, how should you adjust the rental rate?
What action might a manager take if the rental rate does not cover property expenses?
What action might a manager take if the rental rate does not cover property expenses?
What is a crucial part of rent roll preparation?
What is a crucial part of rent roll preparation?
When examining building infrastructure, which of the following is the least relevant factor?
When examining building infrastructure, which of the following is the least relevant factor?
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Study Notes
Office Building Management
- Office buildings have evolved from centralized locations in central business districts to suburban office parks due to the rise of automobiles and the freeway system
- Class A office buildings are characterized by:
- High-rise buildings with luxurious appointments near the focus of the central business district
- Mid-rise buildings in a central business district that are well-maintained, even if several decades old
- Suburban office parks with attractive landscapes and quality interiors, with average rents for the area
- Market analysis involves studying economic data to determine the growth or decline of specific sectors within a city, helping in tenant recruitment decisions
- Property analysis includes factors like access to freeways, on-site parking, square footage of the building, and tenant satisfaction with management
- A market analysis may involve adjusting comparable property rental rates for factors like inadequate parking, either upward or downward, compared to the analyzed property
- To address a gap between rental rate and property expenses, a manager may generate additional revenue, reduce operating expenses, or negotiate lower expectations with the owner
- A rent roll is a list of rents paid by tenants, including:
- Amounts paid under rent escalation provisions
- CAM charges
- Pass-through charges
- It does not include comparable property rents
- Office parks are ideal for companies needing a combination of office space and warehouse facilities
- A tenant improvement allowance sets a maximum amount a landlord will contribute to a tenant's build-out expenses
- Income/Expense IQ is a digital information platform maintained by the Institute for Real Estate Management (IREM), providing details about features and rents for various commercial properties
Small Office Building Management
- Small office buildings may require tenants to provide their own janitorial services due to limited common areas
- A small office building with limited tenant traffic is unlikely to:
- Have a chief engineer on-site
- Have several janitorial shifts and a supervisor
- Have common areas cleaned several times daily
- A manager may conduct an "analysis of alternatives" when upgrading a building to determine if the improvements would attract better tenants and justify the necessary capital expenditure
- Functional obsolescence in a building, such as outdated electrical and telecommunications infrastructure, can be a subject of property analysis
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