The industry will enjoy steady growth as the unemployment rate continues to drop and business activity picks up
Los Angeles, CA (PRWEB) May 27, 2013
The Property Management industry provides a variety of services related to the management of residential and nonresidential properties, including apartments, office towers, retail space and industrial facilities. These services include collecting rent, screening tenants and scheduling maintenance. With its heavy reliance on business conditions and residential and nonresidential development, the industry faced a potential hiccup in 2009 as the US recession finally made its way north to Canada. However, property managers persevered through the economic downturn, growing at an annualized rate of 3.4% over the past five years to $5.7 billion, including a 3.0% revenue increase in 2013. According to IBISWorld Industry analyst Sean Windle, “In 2009, economic conditions deteriorated quickly, with unemployment skyrocketing and disposable incomes falling.” With consumers and businesses cash-strapped, business activity slowed dramatically. As such, apartment and commercial building vacancies shot up and construction on new residential and nonresidential buildings was put on hold. Despite these challenges, property managers still posted positive revenue growth during the year, thanks to the fact that struggling property owners looked to outsource management services to the industry as a means of cutting their own expenses. The industry also adopted its own cost-cutting initiatives in 2009, closing offices and laying off employees.
Over the next five years, the industry will enjoy steady growth as the unemployment rate continues to drop and business activity picks up. “These factors will bolster the demand for residential and commercial real estate and related management services”, says Windle. In the five years to 2018, IBISWorld expects industry revenue to increase.
Most operators in the Property Management industry are small, independent firms that operate on a local or regional basis. As such, market share concentration for this industry is very low. The industry is highly fragmented because participants must have strong contacts and personal knowledge of local markets. Additionally, the majority of industry costs are variable or semivariable, making it harder for firms to gain economies of scale than smaller companies. The industry is also characterized by low barriers to entry and low capital costs, so smaller firms easily enter the marketplace. IBISWorld estimates that industry concentration has grown somewhat during the past five years as larger companies successfully acquired midsize firms to grow market share. This trend has been limited, though, by the continued entry of nonemployers, many of whom were laid off during the recession, yet their skills and contacts with real estate owners allow them to remain in the industry. The largest companies in the industry are CB Richard Ellis, Jones Lang LaSalle, Bentall Kennedy, and Colliers International.
For more information, visit IBISWorld’s Property Management in Canada industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
This industry manages residential and nonresidential real estate for others. Property management responsibilities relate to the overall operation of the property, including maintenance, rent collection, trash removal, security and some renovation activities. Firms may also help manage a property's accounting, but operations relating to the transactions of properties or real estate investments are not included in this industry.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US and Canadian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.