If you’re a real estate investor with an expanding portfolio, a commercial property management company is an excellent choice. But what do commercial property management fees in Australia cost?
Property management services differ from state to state, but such experts typically help investors maintain their property and rental leases.
As per research, commercial property management fees can range anywhere between 4% to 7% of your rental income, but this varies from firm to firm.
Below, we outline the types and costs of services you can expect from a commercial property management company in Australia.
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What is Average Commercial Property Management Fees?
In Australia, the average commercial property management fee depends on several factors, including the location, size, and condition of the property. Additionally, you should include the average property management rates of that area in your total cost.
A property manager’s fees also cover sourcing quality tenants and managing all tasks related to your lease. Short-term rentals and seasonal charges may also incur higher fees, in some cases GST is also applicable on the management fee structure.
Location has a huge impact on your property management fees and is lower in urban areas compared to regional states. For instance, property management agencies in Sydney charge a 5.5% fee, whilst those in Perth reserve an average letting fee of 8%.
How Much Does Commercial Property Management Cost?
The general fee structure for an experienced commercial property manager will depend on how many properties you’re leasing within a financial year.
Average property management fees also include inspecting a property, calculating gross weekly rental, and providing property condition reports.
A reliable commercial property management company also provides personalized service, such as a tenancy database check or emergency repairs.
Here’s a closer look at individual fees.
Letting Fee
Here the property management company will include all costs related to sourcing a new tenant for a vacant property. This fee is also known as the brokerage you pay for finding suitable tenants, often 1 to 2 weeks of rent.
Other tasks include sourcing applicants, communicating with prospective tenants, conducting background checks before arranging a meeting. A property manager will also complete necessary documentation related to your lease agreement.
A permit fee also includes an inspection report that allows you to document the property’s condition at the end of the lease.
Management Fee
This service covers day-to-day activities, usually charged as a percentage of the weekly rental amount, and may include the following tasks:
- Ensuring that the property stays safe and occupied
- Evicting any defaulters or non-paying tenants
- Hiring external contractors to maintain the property
- Regulating insurance fees for a commercial space
- Evaluating financial records for annual reporting
Key Takeaways
- Commercial property management fees in Australia typically range between 4% to 7% of rental income, varying by firm and location.
- Fees cover tasks like tenant sourcing, lease management, routine inspections, and maintenance.
- Letting fees, often 1 to 2 weeks of rent, are charged for finding new tenants.
- Management fees include day-to-day operations, charged as a percentage of weekly rent.
- Additional fees may apply for lease renewal, maintenance, and annual financial statements.
- Location impacts fees, with urban areas generally lower than regional states.
- Investors may choose between a commission-based or flat fee payment model for property management services.
Need More Information on Commercial Property Management? Contact Leah Jay Today!
Whether you’re a new property owner in the commercial real estate game or an experienced one in NSW, speak to our Commercial Property Management team at Leah Jay for better solutions.
Contact our professional team of property managers today!
Disclaimer: This information is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your situation, and for professional advice, seek out a financial adviser.
- Scheduled collection of monthly rent
- Routine inspections done on the property
- Paying council and water rates on time
- Overseeing tenant complaints/issues
