InsiderBrent's Apartment Blog

Ever since I started in the apartment industry, one thing has bothered me:  Problems with occupancy, specifically for well-run communities.  Although supply and demand should level out across a large enough market, when you are talking about an individual community, I couldn't seem to get my arms around why a well-run community should have any problems whatsoever.  There are so many poorly run apartment communities in existence that it seemed odd that any well-run community couldn't have enough supply of prospects to fill up possibly twice the number of apartments that they had. 

But that ultimately was the problem.  No matter how amazing the community, they had a finite supply, which means that they physically couldn't lease double the amount of apartments.  Instead, they were capped at the number of units they had, and using normal courses of business, they couldn't progress beyond that point.  So because they had a finite amount of product, they couldn't pull ahead in any way, which also meant that any hiccup could quickly bring them back to the masses.  In fact, it doesn't even take a "hiccup", as on average 20% of residents are un-savable, meaning they are going to move regardless of your service.  This means that the great community is going to be only 80% occupied at the very best, without an influx of new residents. 

Now I know what some of you are thinking:  Every business has to replace lost customers to some extent.  This is true, but the problem is often in the timing of the sale.  Since there is a finite amount of product AND the customer often has a small window in which to lease at the community, this creates problems with matching new residents with lost residents.  For example, let's say that you lose 15 residents in February and have 20 qualified new move-ins.  But since you can't oversell and place all 20 prospects, you lose 5 potential customers.  Then in April, the reverse could be true, with only 15 qualified prospects to 20 move-outs.  Taking the average for the two months would show business harmony between move-ins and move-outs, but in reality, you are down five residents. 

For those new to this blog series, I have been updating the Insider community about the process of renewing my apartment, all from the resident's point of view.  And so far, the experience has left me less than impressed.  That said, I think things are on the way up, and although I still think the ideal renewal process is a long way off, I'd like to share the latest email follow-up which definitely makes strides in the right direction!  For your reading pleasure:  (not originally italicized)

Hello Brent,

Here are the top 10 reasons why you should STAY:

1. WE APPRECIATE YOU & WANT YOU TO STAY!
2. You won't have to clean out every closet and drawer in your place.
3. You don't have to buy boxes and pack up everything you own.
4. We are so close to all the best "fun" in town!
5. WE APPRECIATE YOU & WANT YOU TO STAY!
6. Your car already knows how to get here without you thinking!
7. You know where everything is in your neighborhood grocery store!
8. You have a great dry cleaner and a convenient membership at the local gym or video store!
9. This is your home and you have great friends that live here too!
10. WE APPRECIATE YOU & WANT YOU TO STAY!

Make the right decision and STAY! Call us today to sign a new lease and reserve your apartment for another year!

Sincerely,
Your Team at XYZ Community

When leasing apartments, there are plenty of challenges with maintaining a high conversion rate that are completely out of the leasing consultants hands.  For example, there might be a lack of availability, the prospect might not need an apartment immediately, the prospect's credit is poor, or the available apartments may just be too expensive for the apartment hunter.  These situations can be horribly frustrating to a leasing consultant, as it impacts his or her supposed effectiveness.  This can hurt morale and even lead to lying to maintain a fake bloated conversion rate.

Even more important, many communities do not have any strategy to handle these types of rejections.  I've seen countless times where the leasing consultant simply told the prospect that they did not have any two bedrooms in their time frame and let the prospect walk out the door. 

Do call centers equal great customer service, or do on-site teams need to handle these calls to continue the relationship they have with their residents?  This is the debate that started on Twitter from some great Tweets by Mark Juleen (@theaptnerd).  Here's the background story...

My poor apartment community...  It often gets the blunt response of my blogs because it's just so available and easy.  I really don't mean to pick on it, as I can tell it is definitely making strides, but I just can't ignore what they place on my door or email me. 

Yesterday, I received an email from my community hoping for resident referrals.  The concept is great, as resident referrals can be a great source of leads.  However, after reading this email, I almost came away less impressed with my community than I was before reading it!  For your reading pleasure:

If you build it, they will come, right?  But the question should be:  If you build it, will they stay?  Are your amenities designed only for the initial lease, or are they designed to give value on an ongoing basis to your residents year after year?  With this in mind, I think we need to reevaluate our amenities with resident retention in mind, and see what is really making an impact on the renewal decision.

Today, I'd like to take a look at the common apartment gym in our apartment communities.  Although some gyms at higher end communities are truly state of the art (and don't apply to this blog), here are some traits of the vast majority of gyms relative to stand-alone fitness facilities:

[Note:  We have free Cinnabons to give away!  See the bottom of the post for details.]

Sometimes, it's best to look at your company/community in the most simplistic terms, so here is something I think many people can relate with:  a warm, gooey, mouth-watering Cinnabon cinnamon roll.  Last weekend when my wife and I were enjoying our "day off" from our diet, we decided the best way to splurge was on a Cinnabon.  The first thought was that we could easily share one, but our stomachs got the best of ourselves and we each ordered our own, justifying it by saying we could always eat any leftovers later on.  There were no leftovers.

Over the past couple of weeks, I've been sharing my apartment renewal process I have experienced from a resident point of view.  Last week's post was fairly harsh, as the renewal letter did very little to entice me to stay at my community.   It was more of a "If you want to stay here, this is how much you are going to pay us" approach, which was less than inspiring, to say the least. 

In the original renewal letter, they said they would call me in one or two days.  I did not receive a call.  Instead, I got a follow-up email exactly one day before I would have to give my 60 day notice.  Here is the email (not originally italicized):

Last week, I shared the renewal letter I got from my apartment community from a resident's perspective.  Today, I will dig a little deeper into the renewal letter and "translate" it from a resident's point of view.  I'm not trying to skewer my apartment community, but rather use it as an example of how residents see these types of notices from all communities.  In fact, there are going to be a lot of property managers who read this and have an almost identical renewal letter, so I hope I don't receive too much hate mail! 

The 60 Day Notice

I just received a piece of paper on my door trying to sell me something worth $11,000!  Crazy, huh?  I usually throw away the Chinese food menus where the Kung Pao Chicken is not even ten bucks, and yet this company wants to get me to buy something worth $11,000 based upon a single paper placed in the crack of my front door.  And no, it didn't have any pretty color pictures or really much of a sales pitch at all.  It was just plain sheet of paper, folded in thirds, and stapled together, so when I opened it up I had nice little holes through the paper to add texture. 

What's even more crazy is that I know this company has my phone number.  Not like I really enjoy sales calls, but is this really the best effort they can give to try to sell me?  I've done business with them before, and they really rolled out the red carpet for me, giving me a tour of their facilities and showering me with lots of attention.  But I haven't heard from them in probably close to a year, and now they expect this pitiful, wrinkled, folded piece of paper to somehow convince me to make my biggest purchase (by far) of the year with them.  In fact, unless I'm buying a car this year, this purchase would probably be ten times larger than any other expenditure I make this year, and they expect me to buy from them based on this??  I don't think they understand sales very well...