What is the Difference between Facilities Management and Property Management?
Most casual conversations won’t be derailed if you confuse facilities management with property management. The two terms are similar enough that you can use them as one in a casual setting but there are distinct differences that can cause confusion and subsequent tangible problems if misused in a business setting.
Although they are clearly closely related terms, they are not interchangeable.
These distinct differences must be understood by educated facilities management professionals when engaging colleagues, customers and other professionals. Bernard MacOscair, Facilities Management Lecturer at Portobello Institute, explains the difference between facilities management and property management:
“Property management is primarily related to the ownership of the property whereas facilities management is about how the services are delivered within that property. Facilities is really focused on people and services whereas property is focused on the buildings and the actual ownership (the buying and selling of that property or renting and leasing)," he said.
Portobello Institute lecturers have extensive industry experience and Bernard noted the vast financial difference by using the example of a large real estate company he recently worked with.
“There is a property division and a facilities division. [The] facilities division ran lots of services and made a very small amount of money and had lots of people working for them. Whereas the real estate did one transaction the week before and they made seven times the profit in one transaction," he said.
One department of the company carrying a much greater financial reward doesn’t make it more important than the other. The only reason the property carries such value is that it’s being maintained by the facilities management department.
The Sila Group is a Real Estate Services and Development Company based in India. They have put together a smart list of defining features to differentiate between facilities managers and property managers:
Roles of a Facilities Manager
Oversees the owner-occupied and leased spaces
Maintains complete business systems and makes sure they work well
Manages the facility staff and delegates work to them
Keeps the building secure and safe
Makes sure the infrastructure and equipment in the building are always functional and work seamlessly
Conducts troubleshooting in case of equipment problems to check if the problem can be solved in-house or if a specialist needs to be brought in
Roles of a Property Manager
Oversees all building tasks
Manages all the tenant leases and fulfils responsibilities of the building owner as mentioned in the lease
Acts as the main point of contact between owner and tenants
Handles rent payments from tenants and makes sure the payments come in on time
Helps building owners move towards their financial management goals
Communicates with the facility manager in case of any issues in the building facilities as reported by the tenants
While the facilities market is broadening with each passing day to incorporate new skill sets, property management is largely based around Real Estate skill sets.
The main responsibility of a property manager is to maintain the owner and tenant relationship in order to maximise profits. The property manager acts on behalf of the property owners and is responsible for the seamless cash flow.