You need only develop an awareness and understanding of Asset Management based on the following summarised coverage

hen we refer to the ‘Management Hierarchy Table’, we’re merely talking about a very simple version of an organisational flowchart. The various professional management disciplines in the property industry tend to operate and inter-relate with one another in a well-defined ‘pecking order’ - with Funds Management at the top of the ‘tree’, and Facilities Management at the bottom.

Since about the mid 1980’s, the capital-investment management domain in the commercial property industry in Australia has undergone an era of rapid change and evolution. It has really only been since the early 1990’s, however, that higher levels of sophistication in operational standards and practices have been developed.

What we refer to as ‘mainstream’ Property Management constitutes only one of a series of possible types of capital-investment-management functions which exist in the modern-day world of the commercial property industry. Quite separately to mainstream Property Management, Asset Management and Facilities Management have evolved to form part of a wider scope of specialisation and diversification which is nowadays present within the commercial property industry, when it comes to the various types of capital-investment ‘management’ roles which are conducted.

Listed property Trusts (LPTs) are an indirect property investment vehicle. LPTs are listed on the stock market and invest in investment-grade income-producing properties. LPTs are readily traded on the stock market and have a high degree of liquidity. to enjoy a tax-exempt status (not pay any tax), LPTs are required to distribute all of their net income as dividends to shareholders.

With the emergence of infrastructure as a new asset class it has also been found to have influenced the allocation of funds to property, but only marginally. Private investment in infrastructure has also been found to be very positive as it has allowed government to reduce their responsibilities and the costs associated in there provision and maintenance.

The performance of these asset-specific options is measured against recognized investment benchmarks. Our aim is to outperform those benchmarks in each asset class over rolling one to three year periods.

In calculating this measure of risk, it is absolute measure of risk

The concept of “risk management” or “reduced risk exposure” is fundamental to asset allocation. What is risk? A number of general definitions are available such as “the uncertainty regarding the expected rate of return from an investment”. Specific types of risk are also calculated by superannuation fund managers (eg. downside risk). Risk is often included in investment advertising, as it is an important element in investing.
Some risks are clearly visible. Others hide from sight.
The unexpected is the one thing you can always expect.
Suppose that overseas political upheaval thins out the flow of a raw material that you can’t do without or significantly changes the level of interest rate and exchange rate?
Life can’t be risk free and leadership isn’t built on sure things.
­given the importance of investment risk, we will spend a lot of time in subsequent sections of this article discussing and assessing investment risk. In particular we will examine the issue of shares being “high risk” and property (real estate) being “low risk”.
A fundamental concept is that investors should clearly follow the “golden rule” of investment and develop a diversified investment portfolio to reduce risk exposure or expressed more simply, don’t put all your eggs in one basket.
On the next article we will discuss diversified investment portfolios and risk.

When researching in the property market, great focus should be provided by a number of excellent property articles, property industry reports and newspaper articles. These property articles are largely from property Australia (published by the property council of Australia) and Australian property journal (published by the Australian property institute); often written by leading property professionals in Australia and overseas.

• Institutional investors • Asset allocation • Risk • Volatility property as an investment option • Property in an investment portfolio • Investment strategies • Diversified investment portfolio • Investment performance indicators

We will explore the ‘personality’ side of the Property Management function, where we look at the desirable personal qualities, characteristics, pre-dispositions and aptitudes which are well-suited to a career in Property Management.

An Introduction to the Commercial Property Management Process.

Asset Management constitutes the ENGINE ROOM which DRIVES the entire commercial property investment management process