Multifamily Blogs

This is some blog description about this site

Multifamily Budgeting Tips During a Pandemic

    It’s that time of year again, budget season. In a normal year, budgeting comes with it’s own set of challenges, in a year with a global pandemic, it can seem nearly impossible.    I had the opportunity to sit down with 3 multifamily friends to chat how they were weathering the budget season in the middle of a pandemic.  Marcella Eppsteiner, Vice President of Marketing for Mission Rock Residential, Kim Boland, Director of Digital Marketing for Morgan Properties, and Savannah Wheeler, Vice President of Finance, Treasury and IT for Mission Rock Residential discussed next years budgeting strategy and how to adjust to an unpredictable world moving forward.    Embracing Nimbleness and Agility  Pivoting in the time of COVID requires nimble responses and openness to change. ”During a week in March where everything stopped, we realized 2020 was going to be an outlier,” Marcella says.    Mission Rock Residential, which typically does extensive performance evaluations for each of their communities when planning budgets, won’t just be comparing year over year, but several years to get a better idea of how far off they are from the norm due to the pandemic. Marcella shares that this year’s data alongside the five previous years should be a key factor for budgeting, along with prioritizing requests.   “Traditionally, we would share feedback and input for the strategy. This year, the real difference is seeing the granular data points that are strategy-determining factors for each department,” Marcella  says.   This year’s global economic upheaval propelled......
Continue reading
1062 Hits
0 Comments

Unlocking the Mystery of Maintenance Expenses

maintenance expenses  “Here’s the list of the supplies we need.” Maintenance Expenses is often the expense area where there always seems to be more days in a month than dollars in the budget. Every week a stock of supplies is ordered.  All too often it results in overrunning the budget.  Workorders have to be completed.  Apartment turnovers have to be completed. There are a variety of explanations for the budget variance report. It includes excessive amounts of resident service orders, scheduled unit inspections and a move out with a high volume of damages.  But this is what we face every month at our communities.  I think its possible to create some structure behind maintenance purchasing.  Not only will this assist in managing expenses against a budget.  It will also provide detailed explanations when future budgets are presented for review. Generally explanations to increase the maintenance budget start with an average of what has been spent.  We justify  an increase because surely supplies will cost more in the future.  Neither are not very effective arguments to defend expense increases. Creating a plan starts with an overview of the schedule for the property for the upcoming month. Turnover Expenses How many apartment homes will be prepared for move in? Generally there are ten to fifteen items that are purchased for every  apartment being prepped. replace the sanitary items in the bathroom. caulk for the countertops in the kitchen, vanity top and shower area in the bath. drip pans for the cook top. The list of ite......
Continue reading
2354 Hits
0 Comments

Strategies for Creating the Right Budget Now and in the Future

It’s budget season!  For many companies, this is a several month-long process of fact finding, planning, and negotiations.  Your budget and budget process can have an enormous impact on your operations, so we’ve outline several different methods of creating budgets, their pros and cons, and how to prepare for implement such methods in the future.   Method 1: Increasing last year’s budget by X% – Problematic if the prior budget is off The easiest way to setup a budget is to look at last year’s budget and actuals and then increase a combination of those numbers by a certain percentage based upon expected market conditions.  However, what it makes up for in simplicity, may cause problems down the road.  Did last year’s budget create the optimal operational incentives to achieve your goals?  Does it provide the right incentives for your star performers? Pros: Simple to implement if you have a prior year budget Cons: May not be accurate May create disincentives for strong performers and reward weak performers What if your best property manager has managed to optimize the performance of their property.  Occupancy is high, rents are strong, and expenses are kept at a minimum, and their next year’s budget is based upon their stellar performance.  You are essentially rewarding them with a more challenging budget due to their great prior year performance, which could cause them to not make the effort to meet the less achievable numbers, or worse, they could decide such unfair treatment is a reason to quit. ......
Continue reading
1525 Hits
0 Comments

2017 Amenities – The Year of the Garden

2017 Amenities – The Year of the Garden
Amenities play a major role for residents joining a community. There are the typical amenities, such as a clubhouse and a gym, but apartment renters expect unique offerings to make a community their home. Amenities are a deciding factor. Like all things, amenities are subject to trends and popularity. While 2017 seems far away, the newest trends in amenities are coming into the spotlight. If you're responsible for the budget, you should take these amenities into consideration before letting the ink dry. Gardens Yep, 2017 is the year of the garden! From living art walls to herb and vegetable gardens, community vegetation is on the rise. Not only do they promote social interactions amongst residents, they provide access to healthy food! Many city communities are adopting these ideas so residents can step out of the urban jungle while they're home. While they've been around for a while, expect to see a significant increase in 2017. Read more about community gardens in our next blog! Luxury Experiences When residents come home from a hard day of work, they want to relax. There are a few ways to do this and in 2017, having a taste of the good life will be a selling point. What could be better than grabbing a bottle of your favorite wine from the secure on-site wine cellar? Maybe a massage from the on-call masseuse in a private therapy room is more your speed. There are communities even starting to install commercial grade kitchens for guest chefs and test kitchen events. We bet a few people could get used to that kind of life. Package Management Package management has been a......
Continue reading
1158 Hits
0 Comments

Budget for Amenities!

Budget for Amenities!
A Budget Including Amenities Can Help You See and Save Green! It's that time of the year again: the preparation of next year's budget for your community. Your budget is likely to cover a lot of different areas; from marketing and sales to staffing and screening. While these are necessary for the property to keep functioning, make sure to make room for amenities. Amenities can increase occupancy and drive increased revenues. It can also be used in your marketing efforts to generate leads. When budgeting for amenities, there are a few things you need to consider. If you follow these three steps, you'll be good as gold! Survey The best amenity is a wanted amenity. A good way to gauge interest in a potential amenity before purchasing is to survey your community.  What do they want? What amenity adds convenience for them? What's going to make them want to renew their lease? You may think your community desperately needs a guinea pig playroom, but you better check first. An amenity collecting dust is a waste of money and isn't generating ANY revenue. ROI Stemming off of the first point, when you figure out what amenity or amenities your community wants, it's important to consider the ROI. You don't want to commit to an amenity with a short lifecycle. You're looking for an investment with long-term results. This can be challenging, especially when trends can come and go. Doing your due diligence through research will be vital to making sure your addition isn't a dud. Find industry resources......
Continue reading
1191 Hits
0 Comments

Top 5 Tips for a Stress-Free Budget Season

Top 5 Tips for a Stress-Free Budget Season
It’s that time of year: budget season. While it can certainly be a stressful time, there are plenty of steps you can take to ease the process and help you actually look forward to the year ahead! Survive budget planning with these tips:   Get Organized. Everyone’s method of organizing may be different, but the important thing is to set aside time to carefully and thoughtfully work on your 2015 budget. Take a look at the previous year’s budget to see what needs to be updated and what should stay the same.   Prioritize Your Spending. When taking a look at last year’s budget, you may realize that there are areas that can be reworked to minimize spending in the coming year. Before you fret about cutting your budget, though, think of ways to maximize those dollars that you ARE planning for 2015. For example, maybe you feel like your trade show spending was too pricey in the past – so consider cutting a show that is not as essential, or use local staff instead of flying out-of-town team members to the show.   Share the Duty. Let’s face it: planning a budget is a lot of work! With many other responsibilities to handle, you can’t devote all your time to crunching numbers. Consider asking your team to help out by tasking them with researching the areas that they are responsible for. After all, they would know their needs best!   Stay Focused. It’s easy to get distracted, especially since you’re also working on many other pro......
Continue reading
1491 Hits
0 Comments

The Right Price for Maintenance

The Right Price for Maintenance
Originally appeared in National Apartment Association's UNITS magazine in March 2014. Is your portfolio consistently over budget? Many multifamily companies have poor property level purchasing habits that have become an accepted way to do business. Busted budgets, rogue spending, decentralized purchasing programs and a general lack of control at the corporate level are just a few of the issues that plague companies that don’t have a technology-based managed procurement plan in place. Typical Purchasing Environment Typically, MRO, paint, floor covering and office supply purchasing decisions are handled at the property level. However, pricing and discounts are negotiated with suppliers on a corporate level. This creates a problem as the purchasing decisions made at the property level are not always in line with corporate guidelines and can erode the value of the negotiated supply contracts. This leaves the management company with little or no control over the supplier, product, and pricing choices being made at the property level, not to mention that maintenance team members who are actually making purchases are doing so against a budget they may have never even seen or understand. Bill Nye, CEO of Fayetteville, North Carolina-based, Caviness and Cates explains, “Before we had a technology solution for purchasing, some of our maintenance team members were keeping budgets with a legal pad and a calculator, some of the savvier property managers had spreadsheets, but even those were hit or miss in terms of accuracy.” A Better Way to do Business e-Procurement solutions are designed to increase NOI for man......
Continue reading
1967 Hits
0 Comments

Socializing With Tenants

Socializing With Tenants
Sometimes it’s nice to just turn off the phone, power down the computer, and do some good old-fashioned face-to-face socializing. And if you’re a property manager or have a property management team, why not extend that socializing to include your tenants? As we’ve discussed in previous blogs, going above and beyond for your tenants is one of the best ways of keeping them and keeping them happy. Here are a few ideas for social functions you can use to show your tenants a good time: Football Parties: These are great events for the fall and winter months, when folks tend to be indoors more often anyway. (Other sports are good as well, but since baseball, hockey, and basketball have so many games in a season, it can get expensive. Best to save those for the playoffs.) Sundays tend to be a little more family-focused anyway, so everyone can come down and enjoy the big game. Holiday Parties: Halloween parties are always great fun for the kids. Early Thanksgiving dinners (or even actual Thanksgiving dinners, for folks without families) can be a great way to build community ties. And Christmas celebrations are a festive time for all ages. Movie Nights: Possibly the easiest function of all -- just pick an age-appropriate crowd-pleaser, make some popcorn, and you’ve got an entertaining night in for anyone who’s a fan of the cinema. “Picture This” Yard Sale: A fun and useful event where tenants bring pictures of items they no longer want and either sell them to or barter ......
Continue reading
1403 Hits
0 Comments

Resident Retention: A Turn Costs What? Part 1

b2ap3_thumbnail_MO-Cost-Q3-2013.JPGTurnover. We're always going to have it. In some cases, turnover is good: saying goodbye to a delinquent or unruly resident who sucks up valuable staff time and resources. Some cases are uncontrollable: a resident is relocating to a new city or state, or they are buying a home. But most turnover is not only bad but something you can directly control. Let's break that statement down. "Most turnover is bad." In the 2012 NAA Survey of Operating Income and Expense, the average national turnover rate was 54%. This number has remained fairly consistent over the past several years, but the bottom line for our industry is that on average a community has to replace half of its customers every year.  Traditionally, our industry has accepted this with the thought that the units can always be leased again at a higher rate. A higher rental rate equals more income, right? Wrong.  Here's why:  Taking into account all of the costs associated with turning and re-renting a unit, on average, a community loses $2,811 every time a resident chooses to leave your community. In some markets, this number is much higher, and if we look at tough economic times, you'll see this number got up to over $4,000 per turn.  Even if you can re-rent that unit for $100 more per month, it will take over 28 months (that is more than 2 years) to re-coup that move-out cost. (By the way, how many of your residents stay for more than 2......
Continue reading
7131 Hits
6 Comments

Marketing Plan 101: 6 Steps to Success

Marketing Plan 101: 6 Steps to Success
Budget-planning season is in full swing, and now is the perfect time to evaluate your marketing plan. Don’t have one? Not a problem – here’s a simple breakdown of what you need to know in order to build a strategic marketing plan for your business:   1. Decide on objectives. First things first: it’s time to figure out what you are trying to accomplish. Consider the strengths and challenges that your brand faces. Whether it’s the competitive landscape, geographic location, your budget, or your staff – it all plays an important role in determining your goals and objectives. As a property manager, you must determine what your occupancy level is and what you would like for it to be – take a look at industry trends and forecasts to determine how your community measures up. It’s important to be realistic when setting goals, but do consider challenging yourself for a greater reward.  2. Determine your audience. Who are you targeting? It’s critical to know who you’re marketing to so that you can tailor your messaging appropriately. A great way to identify your audience is by conducting market research. It’s easy to set up questionnaires using a service such as SurveyMonkey, and best of all, it’s very cost-effective! You can distribute the survey to your residents and prospects through email and social media, or have a staff member conduct in-person surveys at events or in approved public areas.  3. Choose your messaging. Now that you’ve established who your target audience is, it’s time to construct appropriate messaging for your brand. Use engaging content......
Continue reading
3812 Hits
0 Comments