With all of the measures taken to slow the spread of the COVID-19 pandemic, commercial properties are experiencing economic effects unlike any seen in recent years. One of those surprising effects is the decrease in overall operating expense.
Why Are Operating Expenses Decreasing?
Many commercial property managers are seeing surpluses in their operating budgets due to decreased operating expenses. This is primarily due to buildings not having tenets or operating at limited capacity due to social distancing restrictions. As a result, operating expenses are falling and most property management groups are saving money on maintenance costs. Where might you be seeing those savings?
- Utilities are experiencing less usage. This includes water, electricity, trash, etc.
- Cleaning crews are experiencing a lighter load. Custodial staff is required to clean less often.
- Tenant expenses are decreasing. This could include service tickets and other similar items.
- Other maintenance items that might typically be overlooked are decreasing in frequency. This includes small things, such as changing out lightbulbs.
Curious about where and how your commercial property is saving on operating expenses? Comb through your budget and compare current operating expenses to those from a year ago. It will give you a ballpark number on just how much money you’re saving and how much you have to spend on new projects.
What Should You Do With This Unexpected Surplus?
Saving money for a rainy day is always a good idea, but that isn’t your only option for allocating this surplus in operating funds. Most property managers are investing in capital expenditures to improve their properties. With less foot traffic and fewer people around to inconvenience during maintenance and construction, now is the perfect time.
Reallocating that surplus comes with the advantage of not losing your budget. After all, if you spend less this year, you’ll likely be given less money to spend next year. So, spend that extra money on property improvements during Q3 and Q4 to keep next year’s budget looking healthy.
Some Ideas for Commercial Property Improvement Projects
Your property likely has its own unique list of needs. As such, you’re probably aware of specific systems in need of maintenance, repair, or replacement. Address those systems first, along with other more pressing improvement projects.
If you’ve still got some budget left over, take a look at these common improvement projects for some ideas about where to get started:
- Structural Elements – Do your support elements show signs of wear?
- High Performance Flooring – Does your flooring need to be resurfaced or refinished? Is it time to rip them up and install new flooring altogether?
- Stucco Repair – Does your exterior stucco show signs of age?
- Brand Updates – Is it time to update or rebrand? Does your building need an updated color scheme?
- Exterior paint – Does your building’s facade need a fresh coat of paint?
- Interior paint – Are high-traffic areas dirty or scuffed that could do with some touch-ups or a whole new coat of paint.
Need further evaluation or a facility walkthrough? Contact A&K Painting today or request a site visit.
Always Work With a Professional Team
Spend your surplus wisely. The best way to do that is by working with a team of professionals that you can trust to deliver quality results. A&K Painting can help you inspect your property and narrow down the best places to spend your money—whether that’s painting or installing new floors and beyond. From there, we’ll help you with planning your expenditures and getting the most out of it so your budget for next year doesn’t disappear.
Let’s start planning your commercial property’s next improvement project today!