In 2022, the national office vacancy rate reached a high of about 17% in three decades. As people are returning to hybrid and in-office schedules, this number is expected to drop.
It's a great time to own commercial real estate, but only if you know how to manage it correctly. Risk management for commercial properties is essential to understand.
Keep reading to learn how insurance and legal compliance can help commercial property landlords.
Commercial Real Estate Coverage
You can't talk about risk management for commercial properties without speaking about real estate insurance coverage. Protecting your investments, clients, and professional reputation is essential.
A real estate insurance plan customized to your needs can help you avoid losses from the following:
- Property damage
- Natural disasters
- Liability claims
- Business interruption
General liability insurance protects your investment property from some of the above risks. In addition to this insurance, you can protect your property with commercial property insurance and business income insurance.
Property damage insurance protects your property from damages caused by storms, vandalism, and fires. Loss of rental income insurance secures income for landlords if the property becomes inhabitable because of a covered event.
Commercial real estate insurance professionals can help with mitigating risk by connecting you with the right policies.
Legal Conflict Risk
Legal risk arises for property owners in various ways. Landlords must understand the regulated environment they are part of. State and federal laws govern rental properties so you need to understand landlord-tenant law in California.
One fundamental right under this law is that tenants have the right to habitable and safe property.
These laws can change so it's important to stay up to date with compliance requirements. As a commercial property owner, you need to have an understanding of these topics:
- State landlord-tenant law
- Local building and safety codes
- Environmental and energy regulations
If you don't comply with regulations in Antelope Valley, California, you face financial and legal risks.
Ongoing Risk Management
Protecting your property involves creating a plan for ongoing risk management. These are tasks you should always follow as a rental commercial property owner:
- Conducting routine property inspections
- Implementing strong lease agreements and tenant screening processes
- Maintaining detailed documentation of property conditions and communications with tenants
- Utilizing technology to improve efficiency and communication
Owning an investment property is a lot of work. If you don't have the time or expertise for ongoing risk management, hiring a property management company is ideal.
A professional property manager in Antelope Valley, California helps commercial landlords stay compliant and avoid risks.
Risk Management for Commercial Properties: Explained
Risk management for commercial properties can mean a lot of things. When you are covered with the right insurance policies and understand the state and local regulations in Antelope Valley, California, you mitigate risk.
Commercial property owners might be too busy to handle risk management. Luckily, PMI Antelope Valley is a full-service property management company that can help your investments in real-time.
If you want to stay compliant and maximize profitability, consider us. Contact us today to benefit from 20 years of industry experience.