How to Organize A Property Management Company: A Detailed Guide

Operations Team

There are no rules to how and when you should split your company into organizations. Every company is different and you’ll have to find out what works for you through (often difficult) experimentation.
However, property management teams USUALLY adhere to these basic organizational styles. They all have their unique styles and advantages, so let’s understand them.

a. Department

Property management companies organized by departments excel in promoting accountability within each specific department. This facilitates easier problem identification and resolution, as adjusting or replacing team members doesn’t disrupt the company’s overarching structure.
Each department handles a specific part of the business which lets you hire specialized professionals.

Advantages:

1. Clear accountability: With distinct departments and roles, it’s easier to identify responsibility for tasks, achievements, or issues. This clarity can improve performance monitoring and feedback.
2. Efficiency: Tasks and responsibilities are clearly delineated, reducing overlaps or gaps in work. This clear division can streamline operations and enhance productivity.
3. Scalability: As the organization grows, it becomes easier to add new departments or expand existing ones, making departmental structures scalable.

Disadvantages:

1. High overhead costs: departments can be difficult to maintain because they need a minimum amount of people to perform optimally.
2. Slow decisions: Communication between departments is slow given the number of people involved in the process.
3. Little flexibility: In highly departmentalized structures, it may become challenging to reallocate resources quickly in response to changing organizational needs.

b. Pods

Pods are small squads of employees (usually in groups of 3) serving  a small number of rental investors. Each pod manages around 150-200 rental units and handles everything related to their management, including resident applications, resident relations, landlord relations, maintenance coordination, and turnovers.

It’s typical for one pod member to handle one of these sectors. If necessary, they can be supplemented with junior members to help them with repetitive tasks.

Advantages

1. Enhanced communication: By working closely, pod members can foster better communication, ensuring that everyone is on the same page regarding property issues, resident concerns, and more.
2. Agility: Smaller teams can adapt and respond more quickly to changes, be it an urgent maintenance ticket, a common work order, a turnover, or a client request.
3. Personalized service: Unlike departments, pods can offer more personalized service to both residents and property owners, as they have a deeper familiarity with their assigned properties and stakeholders.

Disadvantages

1. Knowledge silos: If not managed well, pods might operate too independently, leading to a lack of knowledge sharing across the organization. This can be problematic when high-quality employees decide to leave the team. This also leads to pods being inconsistent with the way they deal with their clients.
2. Cost implications: Depending on the property management company’s size and structure, setting up and maintaining multiple pods might be more costly than having a centralized team, especially if there’s duplication of resources across pods. If a pod isn’t operating at its full capacity of clients, it automatically becomes a liability.
3. More management: A pods-style property management business is generally harder to scale due to the complexity of dealing with multiple pods.

c. Portfolio

Under this style, a property manager is given a rental portfolio to manage. Managers can become experts in their portfolio, understanding the unique needs and characteristics of each property they attend to.

Advantages:

1. Higher client satisfaction: Owners and residents appreciate having a dedicated property manager who understands their specific needs and preferences and has a history of working with them.
2. More efficiency: Having a single point of contact for all aspects of a property can streamline communication and decision-making.
3. Personalized service: Property managers can offer more personalized and consistent service to owners and residents.

Disadvantages:

• Lack of standardization: Without standardized processes, each manager might develop their unique way of managing properties, which may hinder management and training.
• Inconsistency: Different managers might have varying levels of efficiency, expertise, and distinct approaches, which leads to inconsistencies in service delivery for the same company. Replacing property managers can be a hassle, making this downside more significant. When a property manager is unable to work for any reason, no one else in the company is able to provide the same level of satisfaction to the clients.
• Difficulty in scalability: As the portfolio grows, the manager might find it challenging to maintain the same level of attention and service to each property.

d. Hybrid

Every business is unique. The management styles mentioned above may not be the perfect fit for everyone, which is why you should try to see what works for YOUR company.

For instance, managers can handle diverse properties but collaborate with specialized departments or pods for tasks like maintenance or resident relations.

You can tailor this hybrid style to suit your unique needs, adjusting the level of specialization, collaboration, and individual responsibility to optimize efficiency, communication, and service delivery so you can bring out the best that your team has to offer.

Key Takeaway

Departments, pods, and portfolios are the main management styles that property management companies employ. The property management company structure you select depends on you and your team’s needs. Any of the mentioned styles could be your ideal fit.