Vancouver Commercial Real Estate Podcast

Providing real-time insight into today's commercial real estate industry.

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September 20, 2023
VCREP #109: Maximizing Profits: The Power of Property Management with Heidi Shortreed of Vedderbrook Properties

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In this episode, hosts Cory and Matt are joined by a true expert in the field, Heidi Shortreed from Vedderbrook Properties. Heidi unveils the secrets to unlocking hidden profitability within your real estate ventures through the strategic use of property management.

Tune in as Heidi shares her invaluable insights on how a seasoned property manager can be the key to turning your building into a revenue-generating powerhouse. She doesn't stop there; Heidi delves into a variety of commercial asset classes, giving you a comprehensive understanding of the diverse investment options available.

Heidi reveals with us the insider perspective on acquiring a property sans a property manager, and how this unconventional approach can lead to substantial benefits in the long run.

This episode is a must-listen for any savvy real estate investor looking to take their portfolio to the next level. Join us as we uncover the strategies and tactics that can elevate your real estate game. Another episode for the books.

Don’t have a property management company for your commercial portfolio? That decision might be costing you! We sit down with Heidi Shortreed of Vedderbrook Properties to discuss the power of property management and how the right manager can help you maximize profits on your commercial real estate!

Who is Heidi Shortreed? What is Vedderbrook Properties?

I’m a transplant from Ontario and have been in BC for about 20 years. I came out searching for snowless winters but they’re disappearing. I’m basically the in house property manager for Vedderbrook. Vedderbrook Properties is a private real estate investment company with a portfolio spanning from the Interior to the Lower Mainland to Vancouver Island.

How is the rental market in commercial real estate?

Vedderbrook properties are located in secondary markets and we’re finding a lot of tenants want to move to these more affordable markets. So we’re seeing a lot of movement in these uncertain times.

What work goes into managing a property? What are the benefits of having property management?

One huge benefit is the amount of experience a property manager or management company can bring to your portfolio. For example, we see many mom and pop investors who are paying fees that they should be charging their tenants. In one example, the owners were paying the property taxes despite the lease saying that those taxes would be the tenant’s responsibility.

Every lease is different for every tenant. Sometimes there are caps, exclusions, charges, etc. You have to know those technicalities and they often get missed by people who aren’t accustomed to these kinds of leases.

What are recoverables?

Recoverables are part of the annual operating budget. The budget is the first thing you would do as a property manager when you take over for an owner. Recoverables are fees that can be charged back to tenants such as HVAC, landscaping, garbage disposal, etc.

Recoverables are fees that can be charged to the commercial tenants and don’t have to be paid out of pocket by the owner.

What are the different types of property management?

I work on the private side. I’m hired by the owners directly and work as an employee. I have more direct and hands-on control alongside the owners. There’s also third-party management where the property managers will take care of everything for owners who want to be more hands-off.

What should owners look for in a property management company?

You want to make sure it’s a good fit – that you share the same goals. You want to make sure the property managers are experienced, especially in commercial management. Many companies do residential property management and just assume they can do commercial as well. But commercial expertise is really important.

Turnover is another issue you’ll want to know about. It’s hard to keep up with the amount of buildings coming on and there are only so many managers to go around.

Speak with the manager who will be dealing with your properties directly, not just with the company. Everyone is different so you want to make sure your ideas align.

Some managers are more conservative and don’t want to spend any money on maintenance while others always go over budget.

Can you share a property management horror story with us?

We were working with a multi-family building who were doing a renovation. A foreman on site asked me to send a letter to a tenant who had a dirty balcony, asking them to clean it up.

The next thing I knew, it had blown up into a media frenzy. It was on Facebook, I was getting texts from the media asking me why I was going after this elderly man, my company was getting death threats, etc.

Are property managers getting called by their tenants at all times of night?

In my experience, there aren’t as many after hours calls in commercial compared to residential strata. In residential, there’s leaks and things happening all the time. In commercial, you usually have a security company who does rounds and can check things out. I don’t have any 24 hour tenants but those would require a different lease and different type of security.

I don’t get too many late night calls but when I do, my job is to mitigate and let clients know I’m there to support them.

What kind of tenant would you prefer to work with?

That’s a tough one! I’ve dealt with buildings with brand name, franchise coffee shops and there’s intense wear and tear on the property, lots of garbage disposal, etc. It can be a bit of a pain to manage. Mom and pops can be better on a building but they sometimes tend to call with things that aren’t the property manager’s responsibility. So they’re different in different ways.

What asset class and what market would you choose for a slam dunk lease opportunity?

I think it would be industrial in Vernon. There are opportunities in Vernon but not a lot of options available. It’s definitely a market to watch!

Are you hearing any rumblings about a recession from your tenants or owners?

I think owners are having those conversations more than tenants. They’re wondering whether they should be buying more or what they will do when leases are up.

Tenants are worried about their own businesses but for businesses that made it through covid, they’ve already weathered the storm. They’ve proven that they can push through and still be here. If you’re just starting a business, you need to be really on top of your metrics. I’ve sadly seen many new businesses close down.

The 6 Pack: Getting to Know Senior Portfolio Manager at Vedderbrook Properties, Heidi Shortreed

Favourite bar or restaurant in BC?

It would have to be this little Mexican place in Chilliwack called Fiesta Loca. It has the best Mexican food I’ve ever tasted in my life! I plan my vacation dates around their opening dates in the summer.

What is one book you recommend?

I’m about to start Life Force by Tony Robbins. That’s the new one I’ll be digging into.

Favourite band or musician?

I went through a Snow Patrol phase many years ago. I like Olivia Rodrigo and Harry Styles.

What would your last meal be on death row?

Probably a big Thanksgiving turkey plate with all the fix-ins.

What is your go-to karaoke song?

I won’t sing in front of people but if I was in a private karaoke room you might hear me sing Everytime by Britney Spears.

What is one piece of advice you’d give listeners looking for commercial property management?

Do your research, get references and review your contract so there are no surprises!

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Vancouver Commercial Real Estate Podcast

For all the curious minds interested in commercial real estate investing, grab a coffee and pull up a chair because we have exclusive stories and tips from commercial real estate brokers, investors, developers, economists, urban planners, and everyone in-between. From the successes and failures to the motivations and lessons learned, the Vancouver Commercial Real Estate Podcast is your insight into commercial real estate in Vancouver, Victoria, Kelowna, and beyond.

What's the best real estate market to invest in? What are the commercial real estate asset classes and property types? Hosted by Cory Wright, founder of William Wright Commercial, and co-hosts Adam and Matt Scalena of the Vancouver Real Estate Podcast, our podcast opens the door to real estate investing for everyone from beginner investors to experienced real estate professionals. New episodes are released every Tuesday. Follow the Vancouver Commercial Real Estate Podcast on Apple Podcasts, Spotify, Google Podcasts, or your favourite streaming platforms.

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This communication is not intended to cause or induce breach of an existing agency agreement. E&OE: All information contained herein is from sources deemed reliable, and have no reason to doubt its accuracy; however, no guarantee or responsibility is assumed thereof, and it shall not form any part of future contracts. Properties are submitted subject to errors and omissions and all information should be carefully verified. All measurements quoted herein are approximate.