Have you set the professional bar for your property management team? Do they know when they have hit the mark? Are responsibility centers clear? Let's discuss some measures that let you identify positive progress with a multifamily asset. Following is a short list of high value areas to commit "thinking time". We are applying these benchmarks to stabilized assets.
1. The "So what" question? Every PhD student knows about the "so what" question. Having spent months and perhaps years on a very succinct research question, a committee member says to the student - so what? The follow up question being: "why is this relevant"? Keep the "so what" question in your mind as you work through this list. If your answers make you feel warm and fuzzy, look good on paper but have no functional use- so what?
2. Occupancy. Is your occupancy at or higher than competitive assets in your submarket? Whereas we are most focused on "our" asset, we must view the broader submarket and market for intelligence. It is important to know where our competitors are, operationally, to assist in measuring where to place our resources (dollars and manpower).
Concessions and marketing seem to work in cycles. Sometimes price is all important, other times a free $100 fuel card kicks over leasing activity. Knowing what your competitors are doing (that's working) on a real time basis is important to know.
3. Collections. Where are you on collections on the first, fifth and tenth of the month? Are systems in place- and in use that positively affect collections outcomes?
4. Resident retention. Is your management team ahead of the curve on renewals; 45, 60 or 90 days ahead of lease end dates? Planning ahead makes for stabilized operations.
5. Controlling expenses. Are you comparing service providers for competitiveness? Do you know line item cost as compared to recent quarters and year-over-year?
6. Response to maintenance. Are you delivering a consistent product to your customers? Have you set up reasonable expectations with you customers and do you meet or exceed those expectations?
7. Personnel turnover. Do you know where your people are... in terms of their commitment to property management and being in your employ?
8. Market presence. Do you know your standing in the marketplace. Have you reviewed apartment review sites to see what people are saying about your asset? Can you answer this question; what is your asset "known for"? Is this positive or negative? If positive how can you promote this aspect? If negative, how can you diminish the impact of this information or turn around the reputational harm?
9. Owner Reports. Are they consistent and informative? Are they concise?
10. Do you maintain a vision? This requires thinking time. Do you have time to think?
Back to #1. Were your responses useful to you, to your organization, to the assets in your care? We began this post with a few questions. Have you set the professional bar for your property management team? Do they know when they have hit the mark? Are responsibility centers clear? We end this post with the question; "Do you maintain vision"? Lots of questions. Take on one at a time.
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Multifamily Insight is dedicated to assisting current and future multifamily property owners, operators and investors in executing specific tasks that allow multifamily assets to operate at their highest level of efficiency. We discuss real world issues in multifamily property management and acquisitions. This blog is intended to be informational only and does not provide legal, financial or accounting advice. Seek professional counsel. www.MultifamilyInsight.com