Shopping Centre Management Model

I often had, both within the companies, I have worked with and during consultancy work for third-party clients, been "subjected" to unflattering judgements on the profitability of property management organisations for shopping centres (but this could also apply to the office and logistics asset classes).

"Margins are low! "So much turnover... but for what?" are the most frequent statements followed by the corporate objective of increasing profit of the dedicated P&L.

I have to say that the problem is objective, especially when a company 'inherits' (perhaps after an acquisition) very structured organisations with high fixed costs.

The scenario is different when one can build an organisational model from scratch (which is not very current in mature markets with little new shopping centres development).

In these (now rare) cases, it is possible to adapt the organisational model to the target market and achieve more than satisfactory profitability.

There are no magic formulas, and indeed, the various business models derive from different market contexts.

On the one hand, we have property management companies operating within a group that owns the real estate portfolio they manage or are guaranteed by long-term contracts and fees often higher than those of the "free market" (we…