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You're Selling My Property???

There is a lot in the news lately about how great the market is for the acquisition and disposition of multifamily assets. You see the big players out there “wheeling and dealing” getting in on the action and proudly announcing their companies being assigned new properties in receivership. But no one ever talks about what happens to the onsite team caught in the middle. No one ever discusses how they weather the storm, the upheaval of not knowing what is going to happen next, and how to transition through the changes.

 

“A Negative Thinker Sees a Difficulty In Every Opportunity.” Well, I can well imagine how the onsite team might fall into this trap. After all, sometimes completely out of the blue you are told, usually in an impersonal telephone call, that your property is for sale. Maybe you did have a faint inkling it was coming, maybe you didn’t. Either way, most people will internalize this news and rationalize a plan of action.

 

The onsite team may well first think, “What will happen to us?” followed quickly by “What will happen to me?”

 

Change is difficult. Everyone understands this, but the questions a sale raises can blind any employee into not being able to see the forest for the trees. With today’s economic climate, employees may well worry about their financial well-being. They begin to worry whether or not their paychecks will be good, whether their current company will honor their accrued sick and vacation pay, whether they should cash out their 401-Ks and whether or not they will still have a job after their property is sold. It is up to the current management structure in place to answer these questions and to offer at least some reassurance that the day-to-day operations will continue as usual. It is up to the team in place to reassure those key individuals that it is Business as Usual. Otherwise, even with the offer of a Retention Bonus, key players will jump ship quickly.

 

“A Positive Thinker Sees An Opportunity In Every Difficulty.” Who knows? Maybe the new Owner or Management Company will offer a better benefits package. Perhaps there will be more opportunity for advancement. Maybe there will be a more open attitude toward property improvements. Perhaps there will be more training, more access to higher ups and mentoring possibilities. There can be a silver lining to this situation.

 

For the onsite team, there can be true feelings of loss and a mourning process may need to be experienced, especially for those who have been with a particular property for many years. Grieving comes in many forms, from sadness to anger. I really caution those who are looking to buy the property to be cognizant that the onsite team is worried, is afraid of the unknown, and they, while polite may be bitter even at your presence. I can tell you from personal experience that you may be told untruths by current owners and this may also contribute to the bitterness by the onsite team who are not at liberty to share their knowledge of the property with you until after a sale is completed.

 

The good news is that the onsite team generally will bond over this experience! They will march into the takeover battle together – and this should be the goal. Once someone leaves his position, due to broken promises or fear or the idea of change stirs a longing and re-evaluation of personal goals, the team may flounder a bit.  It would be in the best interest of the property to encourage the team to ask questions openly of the Current Owner so their fears can be softened. Not all questions have an answer! But for Owners to tell the Manager of the impending sale and ask that the Manager not share the news is asking someone to maintain a lie, in my opinion. Trust – it is the cornerstone of all relationships. The Team leader cannot be expected to shoulder this burden with the promise that he or she will be “taken care of later, after the sale.” Play fair.

 

Teams who emerge from an acquisition and/or disposition share a strong bond and likely will be better able to give their allegiance to the new company willingly and joyfully. Before the sale is complete, life on a property goes on. Yep, there goes the phone right now. Time to lease another apartment!

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  • This reminds me of a time that I was a retail manager and we were undergoing an aquisition. Took a lot of resilience and as you stated a positive mindset to lead and steer my team. All of the things you mention here were factors but the truth of the matter is this is one thing we can't control. A positive mindset and clear communication with your team is about all you can do.

  • I have been on both sides of this situation. It really makes a prospective sale tense when the onsite team is kept at arm's length and there appears to be little communication. If Owners and Management Companies could just be honest about the process with the onsite team, there would be a lot less anxiety and a lot more cooperation between all involved. Sometimes, I feel sorry for the Broker who comes out to show the property and they meet with an almost hostile team, which does not present the community's team in a positive light. Can you imagine walking in to the Leasing Office and everyone turns to stare you down? :'( On the other hand, I understand exactly how they feel, too!

  • Been there

    I have seen this many times and I myself have been on both sides. I have been very fortunate to work for companies that understand the true value of the on site teams. It is imperative to always be honest with the team, even if the truth isn't pretty. They do understand and will appreciate not being blind sided when all is said and done. There are some AMAZING team members out there on the front lines each and every day helping these investors make the all mighty dollar. Recognize the value in these associates and treat them as you would want to be treated. with honesty, dignity and respect.

    just my 2 cents.....

  • I was so excited to see you post this topic. I have been on both sides and remember the feelings very well. I worked for a company that did a lot of fee management--I saw a lot of this. The word "take over" made people feel so uncomfortable we introduced new vocabulary---"transition." Eventually, they even created a transition team that would not only go into these communities prepared but well aware of the feelings that these employees were having. It made a HUGE difference. The company that I worked for had a great reputation so luckily when they knew we were coming they were excited to join the team. This is not always the case. The missing link most often is communication. Thank you for sharing!

  • Maria, a Transition team sensitive to the onsite team is an excellent idea! It's funny now, but when I was on site and the Owner decided to sell (my first experience with this), one day three people all nicely dressed walked in with the Broker and announced they were looking forward to working with us and we would be seeing them a lot as they conducted some "walk throughs."

    I said, "You mean 'Due Diligence'?"

    The bubbly Human Resource representative announced, "Oh, we're waiving that! Let's see, we need to get you these forms to sign." She began distributing paperwork and was asking for resumes. etc. I walked over to the phone and called the Owner and asked what was going on. Obviously, this was the new company coming in and taking over.

    "Oh," he said. "They must be from XYZ Management. They are under contract to buy ABC Apartment Homes. They were supposed to wait to come in until I could tell you myself."

    Yes, communication is definitely important. :'(

  • Mindy,

    That would qualify as an AHA! moment :)

  • Oh, my goodness, YES, it would qualify as an AHA! moment, but I think at the time it was really more of a momentary Oh Shoot! Moment instead. Lol!

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