Property administration

“Property administration” is a term that can be interpreted in many ways. The services offered by property administrators vary greatly. Often the term is used synonymously with property management or facility management. Service providers in this segment define the terms based on their strategic market positioning. However, the operational definition of the term is undisputed. Usually property administration is responsible for the upkeep, maintenance and appreciation of jointly owned residential property.1

Major associations and organisations in the field of property administration are normally based on the five pillars of commercial management, legal administration, financial and asset management, technical management and services. Property administration can be performed either by the owners themselves or by external service providers.

The following duties fall within the scope of modern property administration:

General commercial management:

An element of commercial property management is the implementation and management of leases, rent collection and the monitoring of possible rent adjustments. Furthermore, this activity includes the preparation of utility bills and contract management (e.g. concluding caretaker contracts). Contact with the authorities is also of the activities within general commercial management. In the field of home ownership law, the property administrator is also responsible for implementing the homeowners’ association meeting and then for carrying out resolutions.

Legal services:

In the context of its engagement, the property administrator is required to monitor contractual terms (e.g. warranty) and to assist or represent the owner in negotiations. The owner’s claims against tenants are also enforced by the administrator to the extent permitted. Legal activities are limited by the German Legal Services Act.

Financial and asset management:

In financial and asset management, the administrator handles the accounting in relation to the property. It monitors the payment obligations of the tenants or, in homeowner associations, of the owners. It also carries out periodic billing, accounting and payment processing.

If the administrator works for homeowner associations, it must prepare an annual business plan.

Technical administration:

If so instructed and permitted by law, the administrator is responsible for the performance of maintenance work. Administrators also frequently handle the coordination of construction and work to the extent contractually agreed.

Services:

Services can comprise the organisation of motor pools, shared shopping, organising removals or managing a reception service. Different services are offered here depending on the standard of living.2
  • 1 Vgl. Buchner, Florian (2006): Begründung und Verwaltung von Wohnungs- und Teileigentum, in : Murfeld, Egon (Hrsg.): Spezielle Betriebswirtschaftslehre der Immobilienwirtschaft, 6. Aufl. Hamburg, S. 875-943.
  • 2 Vgl. Schmidt, Joachim (2013): Recht der Immobilienverwaltung. In: Schulte, Karl-Werner; Kühling, Jürgen; Servatius, Wolfgang; Stellmann, Frank: Immobilienökonomie II. Rechtliche Grundlagen, 3. Aufl. Oldenburg, S. 510-512.
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: 18.09.2019