When one of NAI Hiffman’s property management teams completed 45 interior and exterior lighting upgrades across one of Chicago’s largest industrial portfolios, the total cost to the client came to $23,000. But the value of the improvements exceeded $2 million before incentives and rebates and the projects generated immediate operational savings while sharpening the appearance and marketability of the buildings.
Projects like that one illustrate what ownership groups now expect from the teams running their industrial assets. Maintaining a property and collecting rent no longer clears the bar. In a market defined by rising expenses and tenant-driven leasing conditions, property managers are being asked to find value and defend it.
“Property managers are now expected to be trusted advisors to ownership groups and act as a partner more than a service provider,” said Michelle Grana, Director of Management Services at NAI Hiffman.
According to Grana, that means owners want real-time data, proactive financial oversight, long-term capital planning and insights that help them make informed decisions with managers expected to identify trends and present solutions before issues affect property performance. Reporting on what happened last month is no longer enough.
Victoria Knudson, Leader of Industrial Property Management and Partner at Stream Realty Partners, has watched the same pressures reshape her teams’ work, driven in large part by ownership’s focus on the expense line.
“One of the biggest changes has been the need to do more with less, which varies depending on the asset class,” Knudson said. “Owners are placing a strong emphasis on keeping operating costs as low as possible to remain competitive in a tenant-driven market.”
That emphasis is colliding with an expense environment that keeps testing budgets. Knudson points to insurance and utilities as the most challenging line items with weather playing a major role in their unpredictability. Security costs have climbed as well, reflecting heightened safety concerns, additional on-site presence during peak hours and investments in new technologies. Labor has been the rare bright spot with year-over-year growth holding within approximately 5%.
Grana sees a similar split between costs that can be managed and costs that simply must be absorbed. Insurance premiums have risen across the industry on market conditions, severe weather and replacement costs while competition for qualified talent has pushed labor upward. Her teams have responded with a more disciplined, data-driven approach: competitively bidding contracts including mass bidding of snow removal and landscaping across the entire portfolio, leaning on preventive maintenance to head off emergency repairs and engaging alternative utility providers where available.
“The goal isn’t simply to spend less, it’s to spend creatively while protecting the long-term value of the asset,” Grana said.
During extended vacancy periods, that creativity has meant working directly with utility providers and vendors to trim holding costs while positioning assets more competitively for lease-up. The lighting modernization program, often completed at little to no cost to clients, grew out of the same playbook.
Technology has become one of the most reliable tools in that effort, though both executives draw a sharp line between platforms that perform and platforms that merely promise. Grana said building automation systems, smart metering, utility monitoring and predictive maintenance tools have delivered tangible results by catching issues earlier and reducing waste while integrated management platforms have given tenants, managers and owners better access to real-time information.
“I’ve found that the most valuable investments are often the ones that solve a specific operational challenge rather than simply adding another platform to manage,” Grana said.
Knudson has seen the payoff in greater connectivity between building systems, from building automation to tenant-facing apps.
On artificial intelligence, both are measured optimists. According to Knudson, AI is gaining traction for lease abstraction and other administrative functions, where it can deliver meaningful time savings depending on the platform. Grana believes the newer AI and analytics tools carry tremendous potential but argues their value today lies in helping teams make better decisions, not in replacing the human relationships at the core of the business.
Tenants, meanwhile, keep raising the bar. Knudson said expectations around amenities and engagement continue to climb across asset classes from property-wide Wi-Fi and access control to environmental and wellness features that tenants can experience firsthand. Even so, she noted that location and rental rates remain the top priorities and her teams have observed a shift back toward traditional security services over customer-service-oriented roles.
Looking toward the second half of the year, Knudson said the biggest challenge will be preparing 2027 operating budgets that keep assets competitive while managing rising expenses, alongside supporting leasing efforts and maximizing revenue generation. Her teams are approaching both proactively to capture every opportunity.
If budget season represents the predictable side of the job, the day-to-day supplies everything else. In the course of normal operations, Knudson’s teams have managed swarming bees on an amenity rooftop after a storm displaced their hive, handled pop-up protests at building entrances, resolved AV failures during heavily attended events and responded to HVAC and elevator outages.
“Each situation requires quick decision-making, adaptability and creative problem-solving,” Knudson said.
That range of demands, from capital planning to displaced beehives, explains why the best managers operate less like landlords and more like municipal administrators.
“Buildings function much like small cities, and property managers rely on a broad range of knowledge and experience to keep them running smoothly,” Knudson said. “You don’t have to be an expert in every discipline, but successful property managers know how to bring together the right resources to solve problems quickly and effectively.”
For Grana, that same breadth defines the profession’s new identity. Property management in 2026, she said, is about strategically managing assets, using technology to improve efficiency, controlling costs where possible and delivering an exceptional experience for both clients and tenants with managers combining operational expertise, financial insight and customer service to maximize value.
The lighting upgrades, the mass-bid snow contracts and the rooftop bees all point to the same conclusion. The buildings may be industrial, but the job description keeps expanding.
