Strong Asset Management Drives Retail Success

(This guest edition of Counter Culture features Michael Tchang, Regional Asset Manager of RPAI's Eastern Division, for ICSC New York National Deal Making. The views expressed herein are his own.)

A major tenet of RPAI's success is our progressive approach to asset management. This is the overarching discipline that drives the performance of all the assets in our portfolio and guarantees strong ongoing tenant relationships. We have a clear strategy to focus our portfolio on high-quality, multi-tenant retail assets in our target markets. This strategy helps us better leverage our local knowledge and expertise in a continual effort to drive long-term value throughout the portfolio. Strong, strategic asset management makes this goal possible.

While the definition of asset management is subjective in our industry, within RPAI it is clear. The asset manager serves as owner, responsible for the oversight and execution of RPAI's strategic goals at the property level. This means that asset management is charged with collaborating and executing with our local disciplines to make decisions concerning construction, property management and leasing.

Thinking like an owner, the asset management team is focused on maximizing annual NOI and cash flow, but not at the sacrifice of long term-growth and merchandising, which at times can be a struggle. The key to balancing these efforts is an informed approach that defines the spectrum of risk and reward at the asset level, allowing us to play defense or offense accordingly.   

As a public company of scale there are significant complexities to consider at both the asset and portfolio level, and high-quality data and intelligence are paramount to effective decision-making and overall execution. As such, asset management is the point of contact for the field and maintains detailed financial models that provide real-time projections of a property's performance including annual budgets, quarterly reforecasts and 10-year models as well as tenant analysis and watch-list data.

This single control point provides better data integrity and overall working knowledge of the models and inputs, which helps to maximize efficient decision-making within the organization. On the ground, the property management, operations and leasing teams are then better able to understand the financial impact of unplanned property expenses or changes in tenancy and collectively adjust our business plans to meet the property's goals.    

In summary, through continual coordination and communication with our experienced team members at a local level, we are focused on informed capital allocation and strive to remove roadblocks and drive projects forward while maximizing value for our shareholders.