Magazine article Journal of Property Management

Service Recovery in Commercial Real Estate Management

Magazine article Journal of Property Management

Service Recovery in Commercial Real Estate Management

Article excerpt

Office, retail, and industrial buildings are assets that deteriorate and lose value over time. This wasting process is accelerated (or slowed) by such factors as physical age, climate, construction quality, and level of maintenance, as well as by the rate of tenant turnover.

Tenants, whether current or prospective, are aware that buildings deteriorate and accept the reality of breakdowns and inconvenience as an unpleasant consequence of occupying space. However, that understanding in no way prevents them from wanting their maintenance problems fixed now, if not sooner.

Their expectations frequently come up against the reality that management may not fix the problem as speedily as they would have wished - or at all. Management's performance - or lack of it - becomes the source of tenants' dissatisfaction.

The maintenance process is the point at which real estate owners and managers most typically make promises to their tenants that they either could not possibly keep or do not intend to keep. Indeed, "over-promising and under-delivering" is a commonplace problem - a prime reason for the widespread mistrust and dislike of landlords.

The over-promise trap

As insidious, misguided, and self-defeating as the "over-promise/under-deliver" syndrome is, its popularity is understandable. Management personnel at a commercial property are sometimes confronted by angry, unpleasant, and occasionally unreasonable people (tenants and their personnel) Who make extreme demands. It is tempting to tell an irate tenant anything just to temporarily alleviate a situation.

At the same time, management employees may make overly optimistic promises to tenants that exceed their abilities to keep. Delays in receiving parts or emergency situations that take priority are just two factors that might delay promised maintenance.

The importance of communication

Another factor that contributes to misunderstandings about service requests is a lack of communication between tenants and management. Different people attach different meanings to the same words - for example, the phrase "right away," is a frequently misunderstood pledge in the real estate management business. Here is how a problem might arise:

Tenant (to manager): "Something's wrong with the roof. We have water leaking in our warehouse area right over our inventory. We had to put tarpaulins over our storage racks last night. We're expecting a large delivery of expensive computer parts tomorrow, and I don't want these parts to get wet. We need them to finish a critical order. This problem has to be taken care of immediately!"

Manager (responding): "I'll send a maintenance technician to your office to assess the problem, and then we'll contact the roofer who's supposed to service the warranty on the roof right away."

(Meanwhile the manager is thinking: "Steve's working on another call right now, and he has two more lined up. I can't pull him off those jobs, and we're really short-handed this afternoon. The only other maintenance technician on site is Gene, and he's working on an air-conditioning unit. I'll write a service request. Maybe Gene can take a look at the roof later this afternoon. In any case, I'll make sure that either Steve or Gene handles the problem first thing tomorrow.")

(At the same time, the tenant is thinking: "This problem is obviously so serious that anybody would understand that it needs prompt attention!" Or: "This problem is so important to me that I'm sure it will be fixed immediately!") While it may be feasible to promise action within a certain time period, it is essential to be as specific as possible about when a response will take place. Nor is it always necessary to promise every service immediately. The customer may be less demanding than the service provider would have supposed.

Most importantly, there is no substitute for determining your customer's expectations. A one-on-one conversation may be all that is needed. …

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