ENSURING TENANT SATISFACTION AND RETENTION.

Posted On Tuesday, 29 January 2002 02:00 Published by eProp Commercial Property News
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The new buzzword in business in recent years is Customer Relationship Management (CRM).  CRM is the acquisition and deployment of knowledge about customers, by using technology, to enable a company to sell more of the right services more efficiently to the right customers via the right channels at the right time.

jay junkoonListen to the customer needs and offer a carefully thought through solution to problems. 

“CRM is about building and nurturing valued customer relationships and by providing value-added business solutions to customer needs,” says Jay Junkoon, property management director: Africa of JHI Real Estate.  Here focus is on the real value from the customer=s perspective.  The customer=s requirements are paramount.  He adds however, effective CRM goes further and requires companies to measure customer satisfaction, through soliciting feedback, which also provides opportunities to uncover holes in management services and how to go about filling them.

 

In the property management context, the customer is the tenant, and, regrettably, in the past property managers have shown little concern for tenant needs and satisfaction; and in some cases tenants will tell you that they have been treated in an abrupt and rude manner by junior staff in property management companies.

 

According to Junkoon, Property management companies will do themselves a lot of good by, and tenants will come to demand, implementing CRM type programmes to manage the business relationship between the property owner/property manager and the tenant.  “The importance of and reason for a CRM type programme is that much of the property management business activity involves the leasing of space, as the prime income generator for the property owner and the property management company”.

 

Given the considerable costs associated with leasing transactions - broker commission, tenant installations, rent-free, etc - it is often more pragmatic from an income and cash flow point of view to renew an existing lease than to try and find a new tenant.  As a result tenant retention is a big part of the business and a key to the long-term success of the property management company.

 

In almost all cases the property owners have little knowledge and information on what the tenants think of the lease conditions, the buildings they occupy and the property managers.  In many instances, tenants= needs and dissatisfactions are discovered too late, such as when a tenant announces that it will not be renewing the lease.  This gives the property owner and manager little or no opportunity to address and remedy the problem, as the tenant would have already committed to a lease over alternative premises.

 

Added to this is the fact that property owners and managers may have the wrong impression of the tenant needs, business conditions and financial position, which is caused by the failure to remain in regular contact with the tenant and to understand all aspects of the tenant=s business.  Having a better understanding of what really matters to tenants will certainly aid property managers to provide better management services, and, consequently, better tenant retention levels.

 

A way of achieving a better understanding of what really matters to tenants, is to conduct tenant surveys, focussing on the functionality and aesthetics of the building and the overall quality of the management services provided by the property management company.  This latter category surveys the ability of the property manager to be receptive to tenant concerns in an expedient, courteous and efficient manner.  Are tenant demands being met and are their problems being solved?  Was the tenant happy with the lease negotiation process, the tenant installation work?

 Junkoon concludes, “Tenant surveys of this sort will give property owners and managers the ability to gauge the likelihood of a tenant=s intention to renew its lease, and could eventually progress towards establishing a recognised industry standard for tenant satisfaction - allowing property managers to compare their tenants= satisfaction rating with those of the competition”.



Last modified on Sunday, 25 May 2014 11:42

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