is property management important duringthis economic crisis? Woodbury:Professional propertymanagement has been kind of ignored in a lot of troubled propertysituations. In previous downturns, various institutions knew wheretheir troubled properties were, say, it was this project on thecorner of such-and-such. The way real estate has been sliced anddiced in the past few years, this separation has delayed peoplefrom paying attention to the physical assets. In the case of atroubled loan, it's difficult to figure out sometimes who'sresponsible for the properties, and the risk is that you'reignoring the assets and further diminishing the value. Whether it'san ongoing project, occupied with tenant relations needs or avacant project that needs security, you need someone who's going tominimize costs or exposure.One of the other things here is that Ithink a lot of the financial institutions are realizing is thatwhen they are going ahead with these foreclosures, taking backproperties or just getting keys tossed on desks by borrowerswalking away from non-recourse loans, they're not exactly sure whatto do with the property. They're not equipped to handle the REOportfolio. It can be tossed to a trust department or even justpeople who manage that local bank branch.

| is this downturn different for propertymanagers?Woodbury:So much of these troubled loansand defaults were from the CMBS market, which just furtherincreased the distance between the owner and the actual property.I'm old enough to have been through prior downturns, this one isunique with the Wall Street effect, the CMBS market has made it alot more complex for managing property. These servicing departmentsare probably just used to arranging the annual property inspectionfor the security of the loan, now the property is falling in theirlap, and it can be even dozens of properties all across thecountry. There's a need for these executives to know there's anetwork of professional managers out there.

| you think that property management may bethe last thing on an institution's mind?Woodbury:One experience I had was when winter started, I wastalking to a small regional bank, and they needed some help withsome foreclosed properties. I asked, "What are you doing towinterize them?" I got this blank pause, and "What?" in response.In think banks and institutions are being thrown into a situationwhere they don't know what to look for; such as is the propertyadequately insured, does it have vacancy exclusions, what are thetaxes at and who deals with the assessor, who holds the tenants'hands to try to keep down the erosion of existing occupancy, thosekinds of things. seems like there's even morework out there for a good property servicer, with courts gettinginvolved in asset holdings. Is this true?Woodbury:We are seeing that a lot of our members are gettingsome good play in receivership appointments, though not as much aswe thought at this point. We're hearing stories from people inareas like Phoenix or California where some of the managementassignments aren't making it through the court system, where theinstitution is trying to hold onto the property until it can returnvalue. However, again, they are not property experts, they don'thave the intention to be a manager of the property, that's where wecome in.

|'ve also heard that with no financingavailable for new deals, that owners are focusing instead onimproving current assets. Have you seen this as well?Woodbury:There is the return to quality by owners today.Many landlords have been used to just cashing the rent checks andnot worrying to much about maintenance, they didn't have theworries of today, with significant vacancy or tenants leaving inthe middle of the night. Owners and investors paid more attentionto inflation and leverage to drive returns rather than theefficient operations of the property. Now that it's not a hotmarket, they have to look at their asset and figure out how to makethe best of it, where can gains be made. Should they invest ingreen efficiency, utility incentives, tenant negotiations orimprovements? We feel there's a prying need for these financialinstitutions to know that there is a network of 18,000 professionalmanagers out there that can handle the needs of these properties.Our members know how to protect an asset, how to handle thephysical issues, minimize operating costs and help maintain theappeal of the property.

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