By using a data-driven approach to uncover more and better revenue streams, as well as to identify efficiencies and reduce expenses, building owners can’t only improve the bottom line of their building portfolio but they can improve their financial leverage to give them room to expand and diversify.
But how do we do this? The amount of data that we can use to identify not only which opportunities we can pursue, but which opportunities offer the best return on our investment, quickly exceeds the time and skill set available to most building managers and owners.
So many metrics
This has been a challenge in many fields, and the challenge has increased even as technology has improved. The concept of database management itself is a young field. it’s only been since the 1950s and the 1960s that the whole concept of storing data on computers and creating a way to access that data quickly and in ways that were relevant to users was first programmed.
This has helped, but it has also allowed the amount of available data to grow. Today there are hundreds of terabytes of data out there to be mined — more than all the libraries of the world could dream of — but all of it’s useless to us without the librarians to help us figure out what data to retrieve, and how that data can be used.
So, you need somebody to act as your librarian. You need somebody with the skills to identify the data relevant to your asset and to help you understand it and the ways you can use it to your asset’s advantage. This person is your asset manager.
The need for a skilled and impartial asset manager is related to my earlier discussions about the benefits of independent and impartial researchers in crafting feasibility studies for new apartment construction. Trained professionals with experience in the purpose-built rental apartment industry are invaluable in helping you understand what to build, where to build, how much to charge for rent and what to do with your asset once it’s built.
Professional advice from impartial advisers
The same is true for asset management. Trained professionals with experience in the management of purpose-built rental apartments are invaluable in helping you understand what opportunities exist for growing your asset, where to focus your efforts and what to do once you meet your goals.
And as in new construction feasibility studies, impartiality on asset management advice is also vital. Numbers may not lie, but our interpretation can certainly be suspect, as we’re often too close to the property that we manage. Having a third party look at the data and identify opportunities will ensure that you can see the forest for the trees and identify the right path to follow.
Skilled asset managers have a strong education background. There are asset management courses available at such institutions as Humber College or the Southern Alberta Institute of Technology. Asset managers also need to have experience in working with the purpose-built rental apartment industry. Consulting firms make it their job to hire these people to provide you with the best and most relevant data to help you build your asset.
The people with the skills to help you
A skilled and experienced asset manager will help you identify cost-efficiencies and opportunities to increase revenue and also tell you which opportunities are most effective and use up the least amount of time, energy or investment. As technology improves, so will the opportunities and the need for individuals who can sort through the data and provide you with the information you need to grow your asset.
Derek Lobo is the founder and CEO of SVN Rock Advisors Inc., a real estate brokerage with over 30 years of experience in helping investors make the most out of buying, selling, and renovating purpose-built apartment buildings. Learn more about SVN Rock Advisors Inc., Brokerage on their website at www.SVNRock.ca.