Charlotte NC Commercial - Blog #Property ManagementCharlotte NC Commercial - Blog #Property Managementhttps://www.charlottenccommercial.com/blogs/tag/Property-ManagementTue, 20 Oct 2026 16:19:04 -0700http://zoho.com/sites/<![CDATA[The Success Of A Prospective Tenant]]>https://www.charlottenccommercial.com/blogs/post/the-success-of-a-prospective-tenant1

The Success Of A Prospective Tenant

Owners must think about vacancies when checking a prospective tenant. Will the tenant’s business survive? When you have a prospective tenant for a commercial center, you must consider whether that prospect would be a good tenant. There are two key standards to apply; (1) the prospective tenant’s financial stability; and (2) the prospective tenant’s potential for success.

Financial Stability

The prospective tenant must be able to afford the rental that you set. Its overall financial condition should be sound. Among the first things you’ll do is to see if the prospective tenant pays its bills on time. Having a reputable credit agency do a credit check on the tenant can easily check this. It is also wise to talk to the tenant’s main suppliers and its current landlord.

An examination of the tenant’s assets is also essential. Ask to see the tenant’s financial records, study them carefully, and discuss with the prospective tenant’s accountant any questions you may wish to have clarified.

Once you are satisfied that the prospective tenant is financially stable, you must ask the question: Will the tenant be successful in your center? To answer this question you must determine the following;
  • The tenant’s reputation at its present location.
  • The tenant’s sales volume. In the retail business, a turnover of stock at the rate of four to five times a year is considered good.
  • The trend of the tenant’s sales. Has the tenant’s sales been increasing from year to year?
  • The type of merchandise the tenant will be selling in your center. You’ll look to avoid duplications with other tenants in the center.
  • The profile of the tenant’s average customer at its present location.
  • How efficiently is the tenant’s business now being run? Is the efficiency or inefficiency likely to continue?
  • The nature and extent of the tenant’s advertising.

No Track Record
The preceding is for the prospective tenant who has an established record, who has been in business and offers tangible evidence of performance. But what about a newly owned business that wants to rent space in your shopping center as its first-ever place of business?

You should appraise this kind of prospective tenant by using the same two key standards: financial stability and potential for success. But instead of looking at past records, you will be predicting and forecasting and making judgments about the prospective tenant’s ability, ideas, and business expertise. It is a riskier situation for the center’s owner-manager but a totally new business might generate totally new interest in the center. It’s not the same old merchants merely doing business from a new location. 

]]>Thu, 01 Oct 2026 15:41:00 -0400<![CDATA[Variations of Commercial Leases]]>https://www.charlottenccommercial.com/blogs/post/variations-of-commercial-leases

Variations of Commercial Leases

A lease is an integral part of many real estate investments. It should outline all the obligations of the tenant and of the landlord. This sounds simple, but many questions arise. If, for example, property taxes increase, does the tenant pay all of the increase or only part of it? If the property must be modernized, who pays for the improvement? Can the tenant be moved out during the renovation? If the costs of servicing the property rise, should the tenant pay none, all, or part of the increased costs? How should inflation be handled—with automatic rental increases? With increases tied to some index, perhaps the Consumer Price Index?

Kinds Of Leases
Here are some of the variations of leases used on commercial and industrial properties:

Flat Rate Lease. This is the traditional lease in which the tenant agrees to pay a flat periodic rate for the term of the lease. This might work with a very short lease, say one year.

Net Lease. Some investors try to protect their net income flows by requiring the tenant part (double net) or all (triple net) of the expenses. For example, the tenant may pay the property taxes; or property taxes and insurance; or property taxes, insurance, and all maintenance and operation expenses. When a net lease is mentioned, always ask what the landlord pays and what the tenant pays.

Sandwich Lease Or Subordinated Lease. The tenant leases all or a portion of the property to a third party who pays to the original tenant. The sandwich lease may be at a rate slightly higher than the original lease payments, thus allowing the tenant to make money from such an arrangement. For this reason, some leases do not allow subleasing.

Percentage Lease. The amount of rent is related to a fixed amount, plus a share expressed as a percentage of the gross or net sales or profits of the business to be paid as additional rent.

Ground Lease. Only the land is rented. The tenant owns the improvements. When the lease ends, provisions are made for allowing the tenant to buy the land or the landlord to buy the improvements.

Leasehold Estate. The value of the lease to the tenant. If the tenant has negotiated a rent below market the tenant has a valuable right (perhaps by subletting at market rents). If the rent is above market the landlord has an advantage, but if the tenant is a strong, credit-worthy tenant the lease may be subject to renegotiation.

Index Lease. The lease amount is related to an index and changes as the index changes. For example, banks located in shopping centers cannot be charged on the basis of percentage of sales because there are none. In such cases an index such as the Consumer Price Index might be used.

Renegotiable Leases. The rents are subject to review and renegotiation at a particular event or after a given number of years. These are usually related to inflation measures and indices.

Improperly drawn leases may not produce enough income to cover the costs of owning and operating the property. And long-term leases in particular present problems when prices, costs, and money rates are fluctuating. There is no substitute for a lease prepared by a skilled professional.

]]>Thu, 01 Oct 2026 15:37:00 -0400<![CDATA[Analyzing Office Building Vacancies]]>https://www.charlottenccommercial.com/blogs/post/analyzing-office-building-vacancies

Analyzing Office Building Vacancies

Office buildings are excellent commercial properties to own. One of the most important jobs of a leasing agent for a building with available space is to analyze other buildings to see if any tenant could be induced to move.

Newer buildings may fill up at the expense of older buildings. Since new buildings cost more to build than the older ones, rents may be higher. The actual dollars-per-square-foot costs must be compared, along with other benefits that the tenant may receive, before a final decision is made by the tenant on staying or moving. Here are some of the items for comparison;

  • What is the time factor for employees at the old location? In a business’ expansion at the old location, they may have expanded to different floors or to different buildings as more space was needed. There may be a big loss in employee time due to the inconvenient layout.
  • In a similar idea, the tenant may be planning an expansion in the next few years, which will make it necessary to rent space in the old location at then-current rentals, raising the average rental per square foot for the tenant’s entire space, in a less than adequate location.
  • Don’t assume that the new space rentals are not competitive. Cost-of-living clauses in the tenant’s existing lease may have escalated the rent level up to the costs in the newer, more modern building.
  • The newer building represents more efficient design, better and newer lighting, modern in every way. The intangible improvements in employee morale and efficiency might overcome any slight difference in dollar-costs per month.
  • Finally, a change in location to a more, prestigious building in a better part of the community can contribute to the reputation of the tenant–and ultimately to the profitability of the business.
  • The tenants who could be good new tenants at the new location will usually not be aware of all of the benefits of a move until they are contacted and are given the opportunity to make the comparison.

]]>Tue, 01 Sep 2026 08:43:00 -0400<![CDATA[The Property Management Plan]]>https://www.charlottenccommercial.com/blogs/post/the-property-management-plan

The Property Management Plan

Real estate investments can be set up to generate one or more types of returns:
  • Cash flow to owners;
  • Appreciation of owner’s capital;
  • Shelter of cash flow and
  • Preservation of capital.
Once the owner specifies the type(s) of return desired on the property, the professional property manager can develop an appropriate management plan to generate the desired result. 

The abilities of a Professional Property Manager will usually more than make up for the cost of the services. The yield from the property will be maximized and the value will be preserved or enhanced.

In a sense, the property manager and the property owner are partners in maximizing the return on investment of the property.
]]>Wed, 01 Jul 2026 10:44:00 -0400<![CDATA[Contact Your Property Manager In Advance]]>https://www.charlottenccommercial.com/blogs/post/contact-your-property-manager-in-advance

Contact Your Property Manager In Advance

The usual way that a property management company comes upon the scene is when the owner of a building makes a contact. Often the owner has just acquired the property through a purchase or exchange, then looks for a manager.

If you are about to acquire an income property, consider contacting the management company in advance. The ability to estimate income and expenses and a keen knowledge of the market makes the professional manager a valuable asset during the preacquisition process. The property manager has the background necessary to provide significant assistance in determining both the location, desirability and economic feasibility of a property.

Inspection And Evaluation
When evaluating a property, the property manager should perform a comprehensive inspection of the physical property, thoroughly review current leases and past maintenance records, and, when appropriate, talk with the on-site staff, and current tenants and neighbors.

Preliminary market analyses and pro formas should be completed during the preacquisition stage to determine the property’s operating costs and to project possible investment return. These analyses will help establish whether the property will perform according to the owner’s investment objectives, or whether the property is too risky for acquisition.

The Rent Structure
When the property is acquired, the management staff will know in advance what can be done with the rent structure. The goal will be to increase the rents to market levels and/or the legal maximum. Tenants with leases can not be given rent increases if their leases prohibit them, but the rent for vacant space or for property with expiring leases may be increased.

The abilities of a professional property manager, as part of our team, will usually more than make up for the cost of their services. Let us help in determining the value of your investment.

]]>Thu, 04 Jun 2026 11:28:32 -0400<![CDATA[The Importance Of A New Tenant Screening Process]]>https://www.charlottenccommercial.com/blogs/post/the-importance-of-a-new-tenant-screening-process

The Importance Of A New Tenant Screening Process

The property manager provides the tenant applicant with the lease application that must be filled out for the interview. A leasing agent may assist during the review process, but the final selection of tenants is ultimately the property manager and owner’s responsibility.


All leasing personnel should be informed that the company does not discriminate on the basis of an applicant’s race, sex, color, creed, or national origin.

The screening process helps determine the prospect’s desirability and verifies financial and nonfinancial qualifications. When all information has been received, the applicant’s file should be given to the property manager and/or owner for final review. Decisions made during this process are based on the following criteria:

    • Impressions created by the prospect when interviewed;
    • The prospect’s employment history if the prospect is applying for residential space; company or business history if the prospect is applying for commercial space;
    • Information gathered from verifying the prospect’s references and from the completion of a credit check;
    • Compatibility of the tenant to the property type.

When the application is approved, the property manager should prepare the lease and other appropriate documents that require the applicant’s signature. Commercial tenants will probably have an attorney review the lease, which may require a certain amount of negotiation. Upon approval, the lease is signed, and security deposits and rent payments are collected as specified in the lease.

When an applicant is disapproved, he/she should be promptly notified. If the disqualification resulted from a credit check, the law requires that the applicant be informed of this. To protect against possible litigation, rejected applications should be kept on file with complete statements about why applications were rejected.

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]]>Wed, 01 Apr 2026 13:14:00 -0500<![CDATA[What Is A Step-Down Rental]]>https://www.charlottenccommercial.com/blogs/post/what-is-a-step-down-rental

What Is A Step-Down Rental

Tenants understand the need for step-ups in their leases because they recognize the inevitable upward trend of costs. There is no reason for elaborate set of definitions in the lease. The lease simply needs to spell out in a schedule the applicable period and the rent to be paid during that period.

The landlord will almost never agree to a step-down rental tied into the possible deflation rather than inflation. However, there is one instance where the demand of the tenant for a step-down in the rental might be appropriate.

When a landlord has been able to get good mortgage financing for the improvement primarily because of the high credit rating of the tenant, that tenant may argue that when the initial mortgage is fully paid off, the rental should be reduced. The cash flow to the landlord will jump substantially because the debt service is eliminated and the tenant may want a share. In effect, the tenant says that since his credit standing made the mortgage possible (and consequently created desirable leverage for the owner), the tenant should benefit as well as the owner when the mortgage is paid.

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]]>Wed, 01 Apr 2026 13:12:00 -0500<![CDATA[Problems With Rent Free Concessions]]>https://www.charlottenccommercial.com/blogs/post/problems-with-rent-free-concessions

Problems With Rent Free Concessions

Commercial property goes in cycles from full occupancy to overbuilt with vacancies. When it has been difficult to rent, various concessions have been made to get tenants in and paying rent.


Free rent concessions have been used sometimes to help fill a building. This may have created more problems than it solved.


As an example, suppose there is a building where office space is offered at $25 a square foot on a five-year lease. The lease can be renewed for an additional five-year term at a negotiable renewal rate. To get tenants into the property, the owner gives a concession of free rent for the first two years. This may sound like an acceptable, though extreme solution, but might not be good for either the owner or the tenant.


The bookkeeping and tax preparation for these two years can be a major problem for both the tenant and the owner.


The landlord has no income from this tenant during the two-year period of the rent concession. This can create a cash flow problem for him.


The tenant’s cash flow is incredible during the first two years, since he is paying no rent at all. Then it jumps up to the $25 a square foot level for the remainder of the lease. This can cause a cash flow crisis for the tenant.


Since the property has such a severe vacancy problem that the owner considered the free rent concession in the first place, he might consider a new manager, or a sit down session with the current manager on how to solve this vacancy problem with some creative ideas other than free rent.

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]]>Wed, 01 Apr 2026 13:10:00 -0500<![CDATA[How To Deal With Security On Your Commercial Property]]>https://www.charlottenccommercial.com/blogs/post/how-to-deal-with-security-on-your-commercial-property

How To Deal With Security On Your Commercial Property

Commercial security involves systems and strategies designed to protect businesses and properties from threats like theft, vandalism and unauthorized access. It not only safeguards physical assets but enhances tenant satisfaction and business continuity. Effective security measures include advanced surveillance cameras, access control systems and alarm systems to insure the safety of assets, employees, and visitors.

The problem of security is a major concern of owners and managers of office buildings or other commercial properties. There are many things to check both inside and outside of a property. Particular attention must be given to the perimeter of the property, as this is where an intruder will make the first contact.

For example, an office building should be inspected thoroughly all around the exterior to search for danger spots. No area should be overlooked because entry is possible from almost any point. The age, design, and location of a building will affect perimeter security.

Older buildings can have more security problems because of the style in which they were built. Often there are street-level windows, exterior fire escapes, and operable windows. Each can increase the number of entry points that must be protected.

Every building will be different, of course. Each will have to be checked, starting at a point and going around the property to return to that point.

Here are some things that will always need to be checked carefully: 
  • Fencing. If there is a fence around the building, is it just ornamental or will it actually protect the property? Are there any vulnerable spots? If there is no fence, is it feasible to install one?
  • Loading dock. How is the dock controlled during regular operating hours? After hours? What personnel are involved? Are there procedures to control deliveries and removal of materials? Is the dock left untended at any time.
  • Windows, fire escapes, & roofs. Do any of these areas pose potential access problems? If any do, should new grates or locking devices be installed? Check on your local codes.
  • Entrances and exits. (Pedestrian and vehicular). How many entrances and exits are there? Where are they located? What kinds of locks are used? Are the locks effective and who has the keys?  What are the hours of operation of each entrance and exit? Is there any kind of alarm system to signal when a door is open? Who responds to these alarms? Would closed-circuit television (CCTV) cameras be of value in any of these locations? If CCTV is used, are the monitors always watched? If there is a parking lot or garage, are the access routes safe?
  • Guardservice. If there is a guard service, what are the guards’ assignments in regard to controlling daytime and after-hours traffic and patrolling the building’s perimeter?
  • Exterior lighting. Is there adequate lighting that can serve as a deterrent to crime? Do time clocks or light sensors control the lights?
  • Landscaping. Are there possible hiding places along routes to and from the building?
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]]>Mon, 02 Mar 2026 09:21:19 -0500<![CDATA[Taking Action For Overdue Rents]]>https://www.charlottenccommercial.com/blogs/post/taking-action-for-overdue-rents

Taking Action For Overdue Rents

A critical indicator of a management company’s success is their effectiveness in controlling overdue rents. A well-run property should not have chronically delinquent tenants. However, when delinquency does occur, immediate action must be taken. A list of all delinquent rents must be prepared showing all tenants who have not paid, or for those who have partially paid rents and other monies due. In addition, a delinquency report recording the manner and date of all collection attempts should be prepared.

When initial notification of the delinquency does not help, the property manager should review the lease’s termination rights and consider possible legal action against the tenant. Should a delinquent tenant suddenly vacate the premises, late charges and legal fees should be deducted from the security deposit.

Finally, if repeated notices and personal visits by the property manager fail to remedy the delinquency, the manager should contact legal counsel, research relevant state and local laws, and prepare to file eviction proceedings for nonpayment of rent.

The Legal Action
Each month, the property manager should review the delinquency report outlining all telephone calls, personal visits, notices, and other actions taken in an effort to collect the rent. This report, along with the tenant ledger, will help determine what legal action, if any, should be taken against each delinquent tenant.

Tenants who generally pay rent on time should be granted an extended grace period in which to pay. In many cases, the initiation of legal action will induce habitual late payers to remit rent monies owed; however, eviction procedures should begin immediately for tenants who are suspected of moving, as well as for those who continue to refuse to pay. Copies of the tenant’s lease and the tenant ledger should be forwarded to the attorney, who can then begin legal action.
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]]>Mon, 02 Mar 2026 09:20:36 -0500