REAL ESTATE ASSET MANAGEMENT

REAL ESTATE ASSET

MANAGEMENT

A PROCESS AND A PROFESSION

By Dustin Read, PhD/JD

REAL ESTATE ASSET

MANAGEMENT

A PROCESS AND A PROFESSION

By Dustin Read, PhD/JD

?2017 by the Institute of Real Estate Management

of the NATIONAL ASSOCIATION OF REALTORS?. All rights reserved.

Published 2017.

This report or any part thereof may not be reproduced, stored in a retrieval system,

or transmitted, in any form or by any means, electronic, mechanical, photocopying,

recording, or otherwise, without the prior written permission of the publisher. Inquiries

should be directed to:

Publishing Department

Institute of Real Estate Management

430 North Michigan Avenue

Chicago, IL 60611¨C4090.

Text and cover composition: Nadia Geagea Pupa

Cover image ? shuoshu / iStock Photos

ISBN: 978-1-57203-251-4

SKU: 761

IREM? logo, IREM?, Certified Property Manager?, CPM?, the CPM key logo, Accredited

Residential Manager?, ARM?, the ARM torch logo, Accredited Management Organization?, AMO?,

the AMO circle logo, Income/Expense Analysis?, Expense Analysis?, JPM?, and MPSA? are

registered marks of the Institute of Real Estate Management.

IREM practices diversity. We are an inclusive organization that embraces and values

differences and welcomes individuals of all races, genders, creeds, ages, sexual

orientations, gender identities, and national origins and individuals with disabilities,

providing an equal opportunity environment among its members, vendors, and staff.

IREM is dedicated to supporting real estate management strategies that advance an

environmentally sustainable and economically prosperous future.

ii.

Table of

Contents

Preface..............................................................................................................................................................................1

Executive Summary.................................................................................................................................................3

Defining Real Estate Asset Management................................................................................................... 6

The Traditional Real Estate Management Trichotomy..............................................................7

Sources of Confusion and Disagreement ................................................................................. 10

A Need for Greater Clarity and Understanding ...................................................................... 12

Analyzing the Perceptions of Real Estate Executives............................................................. 14

Organizing and Interpreting the Qualitative Results.............................................................. 16

Understanding Asset Management as a Process...................................................................... 18

Acquisition Support........................................................................................................................... 18

Business Planning.............................................................................................................................. 21

Leading a Team.................................................................................................................................. 23

Budget Preparation........................................................................................................................... 25

Approving Leases and Capital Improvements.......................................................................... 27

Promoting Operational Efficiency ............................................................................................... 29

Financial Analysis .............................................................................................................................. 31

Market Research................................................................................................................................ 33

Disposition Assistance .................................................................................................................... 35

Surveillance and Reporting ............................................................................................................ 37

Approaches to Asset Management: A Typology......................................................................... 40

Analytical Asset Managers.............................................................................................................. 41

Operational Asset Managers.......................................................................................................... 42

Transactional Asset Managers....................................................................................................... 44

Comprehensive Asset Managers.................................................................................................. 45

The Future of Asset Management.................................................................................................... 47

Filling Knowledge Gaps and Spotting Talent ............................................................................ 50

Assessing the Opportunities and Challenges Presented by Careers

in Asset Management....................................................................................................................... 53

Firm-Level Considerations.............................................................................................................. 56

Concluding Remark........................................................................................................................... 57

References.................................................................................................................................................. 58

iii.

About the Author

Dustin C. Read, PhD/JD, serves as an Assistant Professor of Property

Management and Real Estate in the College of Liberal Arts and Human

Sciences at Virginia Tech, where he teaches courses in asset management,

commercial leasing and real estate development. His research interests

include asset management, property management and the role of real estate

in local economic development.

Special Thanks

Dustin C. Read, PhD/JD, acknowledges the insights of the following individuals

who served as reviewers of the publication¡¯s manuscript:

? Craig L. Cardwell, CPM?, Principal of Island Investment Interests

? Lori A. Tillis, CPM?, Senior Asset Manager, Ohio Capital Corporation

for Housing

? Olan Brevard, CPM?, Senior Vice President ¨C Acquisitions and

Development, EdR.

About the Institute of Real Estate Management

The Institute of Real Estate Management (IREM?) is an international community of

real estate managers dedicated to ethical business practices, maximizing the value of

investment real estate, and promoting superior management through education and

information sharing. An affiliate of the National Association of REALTORS?, IREM is the

home for all industry professionals connected to real estate management¡ªand the

only organization serving both the multi-family and commercial sectors. IREM offers

a variety of membership types for professionals of every experience level, from onsite managers to high-level executives. IREM awards these credentials¡ªCPM?, ARM?,

ACoM, and AMO?¡ªto those who meet high standards of education, experience, and

ethical business practices. Since 1933, IREM has set the standard for best practices in

real estate management. Today, IREM? membership includes over 19,000 individual

and 550 corporate members.

iv.

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