Property Management
We will provide all property management functions on each property we acquire. We believe that intensive property management and operating expense reduction initiatives should allow for long term appreciation in the value of each property purchased. We believe that well-maintained and improved properties during the term of our ownership will also lead to greater tenant satisfaction. High tenant satisfaction will become critical during negotiations for lease renewal upon expiration of the lease term. We intend to establish fully funded reserves for future capital expenditures to ensure that our properties are properly maintained.
We believe our focus on newer properties reduces the risk of tenants failing to renew their leases at maturity and increases our ability to re-lease the property if the tenant does not renew. Newer properties are less prone to building obsolescence and maintenance issues, limiting capital expenditures and improvements over the life of the initial lease term. Industry research has shown that the renewal rate for government-leased buildings is greater than ninety percent (90%).
There are fewer management issues for owners of government-leased buildings because there is only one independent U.S. Government tenant to deal with and government tenants show the greatest tendency to stay in place, thereby reducing tenant turnover, leasing expenses and management time. Failure to renew government leases are caused by one of two reasons: tenant agency mission changes (needs more space) and poor property management. We believe we can provide the best property management service for any government-leased building for as long as we manage the property. This service includes contracting with the most cost effective and responsive vendors for the property and closely monitoring their performance. |
