For most, late summer and early autumn means back to school, barbecues, and outdoor fun. For commercial property managers, it means something different: budget season.  Stacks of paperwork and high-stakes guesswork make budgets a complicated process. The additional lingering uncertainty of COVID-19 may also make planning a daunting task. Below are a few tips that might help get you back to the barbecue faster!

  1. Create a Property Management Budget Planning Schedule

Property management budget planning is a year-round effort. Gathering vendor proposals, deciding on next year’s projects, and logging expenses always takes longer than you think. Position yourself for success by creating a schedule ahead of time with internal deadlines. Create ample cushion time to collect the materials you need and obtain the necessary approvals. If you’re delegating tasks, include the point person for each step in the process.

  1. Account for Changes in Occupancy

After a major disruption like COVID-19, occupancy levels may fluctuate more than usual. After identifying which tenants might be dissatisfied, start conversations early to determine what your team can do to keep them in your space.  Ask returning tenants if they will use space full time, on a modified schedule, or not at all, so your team can accurately allocate energy spending.

  1. Use Work Order Data

Equipment breakdowns are an unwelcome—and inevitable—surprise that require rapid adjustments to a carefully planned budget.  Stay a step ahead of asset failures by routinely analyzing work order trends in equipment repairs. This can help you predict the lifespan of key equipment and factor replacement costs into your property management budget planning.

If you want more concrete timelines, modern software tools to assign a life expectancy score. A budget that preemptively builds in these sizable expenses has a higher chance of being approved by cost conscious executives. You can also use work order data to assess staffing levels. To do so, use a software tool that provide visibility into preventive maintenance and work order data. If you know how much time your team spends on different request types and each team member’s performance, you can expand or reduce headcount as needed, using data to guide your decision.

  1. Benchmark Operating Expenses

Data without context has limited value. To identify areas for improvement, measure your operating expenses against those of competitor portfolios.  Having a relevant point of comparison can help property managers control costs and justify certain property expenses to stay competitive.

In this area, it’s generally considered best practice to use third-party data sources. These tools are particularly helpful for property teams dealing with pandemic-related expenses. There’s no historical data to inform spending decisions for items such as personal protective equipment for staff or more frequent cleaning services.

  1. Stay Ahead of Tenant Trends

Tenant needs and priorities change frequently. To allocate limited resources where they’ll have maximum impact, stay updated on current tenant experience trends. Reading industry publications and reports is a solid first step.

Also, go straight to the source to truly understand what tenants want. In smaller buildings, this can be achieved by sending out tenant surveys or having informal conversations. But for teams looking to standardize the feedback process, tenant experience apps are likely a better choice.

  1. Use Technology to Automate Slow Processes

Compiling the vast amounts of information needed for property management budget planning is usually a major time suck.   Luckily, modern building operations platforms and point solutions can now house all data in one central location, empowering property teams to quickly run analytics reports. Property management software can compile data and present it in clear, visual formats that fuel informed budgets.  Also consider using designated accounting software. It tracks revenue and expenses and automates other mundane accounting workflows.

  1. Put an End to Property Management Budget Planning Blues

The commercial real estate industry is recovering from COVID-19. But property managers still face unprecedented pressure to contain costs while creating spaces and experiences that drive tenant loyalty.  Although these tips will be particularly helpful during property management budget planning season, they can be leveraged throughout the year to cut costs and make your processes more efficient.