Topic: How Is Your Bonuses Structured?

I've only worked for one company with bonuses and I got a bonus for a new move-in and a 12-month renewal.
As a manager, I got $50 per month for meeting NOI. I am now an area manager looking at the bonus structure of the property manager who gets a bonus for a new move-in and a bonus for a 12-month renewal.

I believe the bonus should be a reward based on improving the company revenue. Currently the bonus for a move-in is given no matter when the move-in occurs and with a concession given to the move-in. So if the unit is available for a pre-lease with a 60-day notice and is still not leased at move-out then 15 more days go by until a new tenant moves in and we give them $300 free rent, the manager still gets a bonus. I don't see incentive in that to improve revenue.

Does anyone have any restrictions, like deadlines or no concessions, on the move-in bonuses? Or does everyone get a bonus no matter when a tenant moves in?

Our company does not give out yearly or quarterly bonuses. As leasing agents we get $25 per move in for commissions. Our company does, however, throw us a big Christmas party every year at the Grand Geneva Resort in Lake Geneva, WI with free rooms, a three course meal, open bar for three hours, dessert buffet, and a DJ. It is super fun and makes up for not getting a bonus. :)

This is such a great topic, Sandy! Do different property management software provide advanced bonus structures like you are suggesting? It would be really interesting to have a set of rules that helped define the bonus based upon the speed to rental, concession amount, etc.

Brent, I have presented such a bonus schedule to the owner of the properties I oversee. It is based on increasing revenue and reducing delinquency in areas of leasing, renewals, collections. It also has deadlines for move-ins and renewals.

I want to add a percentage for 3rd party bad debt collection, but that usually takes so long to receive, I'm not sure it would be a good incentive and achievable in the first year.

It has been a while since I worked on site, I am now in a vendor role, but I can say from experience, the less complicated the better. I understand the reasoning behind structuring the bonuses based on increasing revenue, but if you make it too complicated, its more work for you in the end and the leasing team gets frustrated with a complicated system.

I would do a separate bonus structure for the Manager, as they should be evaluated on NOI, since they are repsonsible for the overall performance of the site. Looking at Quarterly numbers would be best for the manager as budgets can be hard to follow month over month, depending on how expenses hit, but looking at the NOI after 3 months should be a fair assessment.

Assistant Managers should be evaluated on new leases, renewals and delinquency. (assuming they do participate in leasing and renewing) For the delinquency, I would set a specific amount tied to a percentage of delinquency. i.e. $250 for delinquency under 1%. $200 for delinquency between 1% - 2% etc.

Leasing agents should be evaluated on new leases and renewals. Having bonuses based on lease term would be ok, but I would limit it to something like 6 - 11 month leases get $25 and 12 + get $40

I don't think leasing people should have the ability to structure concessions because it can lead to fair housing issues. Concessions and prices should be set by the manager or above. As long as they ensure that the lease paperwork is completed accurately and they follow the pricing and concession guidelines, they get paid their bonus. Failure to comply means no bonus for that lease. The leases must be in order to count if the property is sold, so it is important that they complete the paperwork correctly. Scrambling to fix things during the sale or audit process is too late.

Great topic, great timing!

Our leadership has worked to create a bonus structure that aligns each of our team members as well as our regional and corporate staff. As owner operators cash flow is important to us and to our investors. We incentivize our team on revenue less expenses, the customer experience (measured by each regional in a scorecard fashion) and on retaining great residents.

While there was resistance to change early in the process our teams have really embraced this concept with the understanding that their actions (or inactions) have a major impact on the overall financial performance of the property.

$75 bonus for each lease and another $25 if prospect moves in within 3 days

We give out a bonus if our managers turn over an apartment and move a new resident in within 7 days of a former resident moving out. This is an additional bonus that is on top of the bonus they can earn for leasing the apartment prior to the unit being vacated, and they can also earn a bonus for how much the rent is increased between tenants.

Sandy,

Depending on what you pay your collection agency, it might still be worth it to pay a collection bonus to employees. Especially if your company has a high employee turnover rate. If they employee leaves, they couldn't earn the bonus, so it might offer an incentive to stay, and the incentive would still be less expensive than paying an outside collection agency.

These are all great ideas and right in line with my proposal. I really liked the basic bonus for a new lease with an added bonus if the resident moves in within 7 days of vacancy. The same could be done with lease renewals.

In our market, there is a 60-day notice to vacate required, so I expect all leases for renewals to be signed by that date with leases beginning when the old one ends. Waiting until the last week before their lease expires to have them sign a new lease is giving tenants an out to give a 30-day notice and us less time to pre-lease it.

I want the renewal bonus to be given if the leases are signed 60-days before expiration, not whenever the manager can get the resident to sign it. If they don't sign by this date, we can give them notice of month to month rates beginning when their lease expires.

I also am proposing a bonus with 2% or less rent-only delinquency either monthly or for 3 consecutive months.

Total bonuses that could potentially be earned is $6,000 annually with a possible year-end bonus.

Thanks everyone!

We are a luxury community in Bethesda, MD so our may be a little higher than most.

Leasing Bonus for all props---Flat fee of $200 for all leases 10 months or longer,$150 for 6-9 months and $100 for 1-6 months. $0 for Transfers as they are added to renewal pool.

Renewal Bonuses for all props—Flat fee of $150 per renewal for all renewals 10 months or longer, $75 for 4 to 9 months if applicable. $50 paid for each transfer that occurs after the lease is up. Transfers would be added to the renewal pool. Spread equally among all team members.

Delinquency Bonus for all props—Up to $250 per month based on performance. Overall responsibility for collections/delinquency performance will rest with the Property Manager. This will go to whoever PM designates with Regional Manager approval.

We get $175 - $1000 depending on the unit, $1000 being the penthouses. And $500 for every renewal.

On my own experience working for 3 different big multifamily company. Bonuses definitely depends on the budget of the property. However, I have worked 20+ properties remotely on different cities. I could say big city such as Seattle offers great pay and leasing/renewal bonuses. $150-$200/lease, same as to lease-ups. Renewals are $100-$150

Smaller cities rental bonuses $50-$85
Renewals can vary between $50-100

As an assistant manager, I never received NOI or delinquency bonuses. But If employees are paid well, they will not leave. So pay them well.

With my current company, I am Senior Leasing Professional/Leasing Manager. Our company does not pay commissions and the bonus structure is capped out at $300/month. We do get a higher pay rate to make up for no commissions so that is a silver lining I suppose? The property I am at is 15 years old and it shows as there have been no updates since we were built. I have not seen a bonus since probably sometime in the middle of 2018.

After reading these replies and talking with my friends who are leasing agents in the same city I am in and they are getting paid $1/hr. less than me all of a sudden my $33,280/yr. does not make me feel motivated to stay especially since I have been with this company for 2 years especially since they make commissions as well.

I believe that the bonus structure should be paid no matter what. If specials are given why should that affect property Managers, Leasing Agents, or Assistant Managers. I am a Regional Manager & I am a firm believer that employees should be compensated, they work hard to lease units and meat deadlines.