Asset Management

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The Power of Branding

When it comes to branding, most people instantly think of a logo, which is a testament to how powerful a unique brand can be. Maybe it’s the Nike swoosh, Facebook’s “f”, or the golden arches of McDonald’s, when people see these logos they automatically know what the brand is and what it stands for. Having said that, a brand is much more than just a logo.

A complete brand has three important elements: what, how, and feeling.  What does service does your property provide, how is it provided, and what feelings or emotions does your property evoke? For property owners, these three elements act as a blueprint to creating the customer’s perception.

For multifamily properties, the what is straightforward: a place to live. In the eyes of a customer, a property’s how is the special and unique way it delivers its what. The how is where a property can create a competitive edge by providing unmatched service, which leads to the final, and arguably most important element of branding, feeling.

Only the most successful brands convey the feeling element of their product or service. In most cases, people will not give you their business if they feel like they will be treated just as a means to another rent check.  If your property creates a laid back and inviting feeling with a friendly staff and fun community, that should be echoed through the branding. This will attract tenants with similar values and motives, ultimately improving the property’s environment.

Attached is a segment of a TED Talks seminar by optimist and best-selling author, Simon Sinek, who does an excellent job explaining how the most successfully branded companies use the aforementioned blueprint to their advantage. 

Simon Sinek’s Ted Talks Segment

Implementing this blueprint will create an effective brand that will prove to be one of the most powerful assets in differentiating a property from its competitors while setting the standard of excellence in the market.

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Unique Marketing Techniques

The success of an owner’s property is largely dictated by marketing efforts. A property can offer the best units and newest amenities in the industry, but without effective marketing, potential customers will never learn of what they are missing out on.

In an article from AM Digital, author Alex Middel compiled a list of 40 creative marketing strategies multifamily owners and managers can take advantage of to educate potential customers on the benefits of their property and its community.

The first 20 ideas are offline strategies that are effective in reaching the surrounding community that may not spend as much time online as others. The latter half of the list is comprised of techniques tailored to reach prospective customers through the internet whether its via social media, search engine optimization (SEO), or visual content such as pictures or videos.

Click here to see all 40 strategies and learn some innovative ways to attract new, potential tenants.

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Tenant Incentives

Like any other business, multifamily properties have to provide desirable incentives to obtain and retain customers. And with competition being so high as of late, every property is looking to stay one step ahead of the others in the area. Having updated units and new amenities isn’t enough anymore, so properties have started offering various types of incentives to new and current residents to combat lower vacancy rates. Here are a few effective incentive programs to gain and keep quality tenants:

Early Payment Discount

Make paying rent attractive by rewarding tenants with a discounted rent for early payment. Even if it’s a small amount like $10-15 off their monthly rent, proactive tenants understand the discount can add up to a nice sum of cash at the end of the year. In addition, the early payment incentive helps lower delinquencies and attracts residents that are more likely to pay rent on time. It’s nice collecting extra cash from late fees, but that’s not the type of revenue, nor the target audience owners should rely on. Allowing tenants to pay rent online provides extra encouragement to pay early as they can send in their money electronically from the comfort of their home, or on the go.

Another fun way to reward early-bird payers is a monthly raffle. Anyone who pays their rent early gets their name added to the raffle, and at the end of the month the name drawn wins. Prizes can range from dinner and a movie for two, to gifts cards, or a free car wash. Furthermore, if it’s the holiday season, some popular prizes are a free turkey for Thanksgiving dinner, or a HoneyBaked ham for Christmas eve. The raffle program can be fun for everyone involved, engages the community, and is a great incentive for residents to pay rent early.  

Referrals

Tenant referral fees are an excellent way of bringing in qualified residents while saving money on advertising. A tenant referral program offers numerous benefits. Renters are motivated to act as ambassadors for their property by spreading the word of the advantage of their living community. Also, good tenants tend to know reliable people. This may not always the case, but there’s a high chance a tenant who regularly pays rent early or on time will not refer someone they deem unqualified or untrustworthy. When a tenant refers someone who signs a lease, their reward can come in the form of rent credit, unit appliances like a television or microwave, gift cards, or even cash.

Lease Extension  Once a tenant has proven to pay rent on time and take good care of their unit, the next step for management is to retain that tenant for as long as possible. Offering a reward for lease renewal is one of the most effective ways to achieve high rates of tenant retention. In general, tenants prefer monetary incentives, so lowering their rent will give them most motivation to stay. If there is no wiggle room on rent rates, giving tenants unit upgrades is a good substitute. Returning tenants often like to move into a newly renovated unit, but if there aren’t any available, upgrading their unit with brand new appliances has proven to suffice. Also, if the unit has the necessary connections, provided washer and dryers are in very high demand. Ultimately, management should do everything they can without breaking the bank to keep their best tenants.

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Mastering the Make-Ready Process

There are so many moving parts when a unit undergoes the make-ready process, execution can be stressful and overwhelming for an unprepared management and maintenance staff. If that’s the case, the make-ready process will cost a property excessive capital in maintenance and upgrades while losing important revenue due to extended vacancies. But with the right tools and tactics, a make-ready can be a smooth and efficient transition that will ultimately be well worth the dedicated time, money, and effort. Listed below are some excellent  tools and procedures to optimize the make-ready process. 

Technology

Lease expiration management plays a crucial role in the make-ready process. Being able to efficiently monitor and manage current and upcoming vacancies will largely dictate how efficient performing a make-ready will be. There are an abundance of revenue management/lease expiration software programs on the market property managers can use to simplify lease, revenue, and market monitoring. That being said, it is always important to maintain a human element when using technology, as the software should be viewed as a tool, not an employee replacement.

Click here to see a list of accredited lease management software programs. 

Walk-Throughs and Preventative Maintenance

Management should be regularly performing walk-throughs to monitor the state of each unit.  The walk-throughs offer a number of advantages. First, management can bill tenants for any damage done to the unit and maintenance can make the necessary repairs that may have prolonged the make-ready period. Second, walk-throughs allow maintenance teams to make any repairs  that would otherwise become a larger problem as time passed such as leaks, mold, or structural  irregularities. In the end, proactive management and maintenance shortens the make-ready to-do-list and reduces a unit’s vacancy duration.

The make-ready process begins the instant management sends out a notice to vacate the unit. In addition to consistent walk-throughs, performing inspections prior to a unit becoming vacant will help understand what is needed to complete the make-ready. Furthermore, pre-inspections will minimize unexpected maintenance problems, prepare the renovation team to execute the make-ready processin a single, efficient effort, and ultimately reduce the total time the unit is vacant.

Staff Incentives

Having a proactive maintenance staff is one thing, but being able to combine that with a knowledgeable, well-trained management team is what turns a good property into a great one. If the property staff is running like a well-oiled machine, cooperatively working towards a common goal the make ready process should be a breeze. A good way to ensure everyone is on the same page is offering the staff incentives based on how fast a make-ready is completed along with the quality of their execution. With everyone’s bonus being tied to each other’s performance, the staff is encouraged to excel as a team. Additionally, the cost of incentives is minimal compared to the loss in revenue from having a vacant unit on the books for too long.

Bonus Tip

Sometimes a staff has to start multiple make-readies at the same time, which can be overwhelming, even for the most prepared of staffs. One way management can get a head start on the make-ready process is having leases expire on Mondays. When leases expire at the beginning of a week, often times tenants will move out over the weekend. This reduces the number of days a unit is vacant, as it allows management to begin the make-ready process a few days early while the tenant is still paying rent on the unit.

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Tenant Turnover

Yesterday we talked about tenant retention and some characteristics that motivate them to renew their lease. Using the aforementioned strategies will certainly help minimize resident turnover, but even a property with desirable amenities and excellent service, there will always be a situation where a good tenant has to move out. As soon as a unit becomes vacant,  the following actions taken by management and ownership are crucial in terms of cost and revenue.  

Check out this article from Multifamilyexecutive.com that offers some beneficial tactics owners can use to offset the disadvantages of resident turnover and potentially turn a negative situation into a positive one.