The multifamily landscape is ever-changing and the tumultuous times the industry has weathered since the onset of the pandemic have only emphasized the importance of having a strong strategy in place when it comes to property management, as this is an integral part of the foundation for success.
Now, more than ever before, it’s critical that property management companies are developing a focused approach that extends beyond simply managing properties. Instead, companies that see clients as partners and foster a vested interest in their goals to craft creative business plans that dig deeper into the asset management strategy are the ones that will prosper.
There’s a certain “je ne sais quoi” that transpires when both owners and managers work together to reach their goals. However, this doesn’t happen accidentally. Firms should collaborate early and at a granular level with investors to understand the unique goals of each property to then tailor the approach of our management services to exceed expectations.
So, how can you maximize the value of multifamily investments? Begin with a customized management plan for each property with a deep dive into the overarching objectives to truly cater to each client on a personal level. This multitiered process is outlined below.
Operate With an Owner’s Mindset
Begin by operating with an owner’s mindset—this will serve as the root of everything.
Together, examine the different elements that will be essential to successfully lease this asset and meet NOI targets, really immerse yourself into the data and local intel and look at the project as if you owned it. This means becoming an extension of their team and, as such, being vocal about strategies to implement that will steer them in the right direction.
While it’s important to take into account current trends and resident desires when building the business plan, leveraging insights gathered from the client regarding their desired results and future plans is just as crucial.
Take a Unique, Data-Driven Approach
While achieving NOI is a clear goal, the path to get there can vary greatly. Determining the best course of action will involve analyzing the full scope of the project.
First, consider all aspects of the building including capital availability for enhancements, sensitivity to expenses, current debt and constraints and occupancy goals. Additionally, dive into the data of what’s currently happening at the property, what trends you are seeing and what residents want.
After breaking down these various components, you can then pair this data and local market expertise with client objectives to guide you towards the best path to take. For example, sometimes dropping occupancy in order to renovate results in higher rent over time. However, clients may not be able to weather lowered occupancy in the interim so you must find another way to get there.
Analyzing and using the data allows you to get a full grasp of the project at hand to reveal the various paths you’re able to take. But being agile and innovative in how you use that data alongside client objectives will reveal the best path to get there.
Know One Size Does Not Fit All
Once you’re aligned on goals and the steps to get there, the partnership can begin.
Your team likely already has best practices in place. The challenge will lie in having the ability to be nimble and adapt to the distinct needs of your client. A one-size-fits-all approach will only be a hindrance in this situation. Instead, work together to blend practices and create a harmonious approach.
Be open to taking risks and bringing out-of-the-box ideas to the table. With a deep understanding of what the goals are, you’ll be able to develop recommendations and all-encompassing strategies unique to each asset. Treating each project as its own will allow you to capitalize on the skills of each client.
It’s also important to listen to the market. If it’s informing you of something different than your original plan, it’s your responsibility to speak up and make a change. While it’s crucial to have a plan in place, it’s even more key to have the ability to recognize when that plan is no longer best suited for current trends and quickly pivot.
Like listening to the market, it’s also vital to understand the evolving needs of prospects and residents. For example, residents are using their living spaces differently in the wake of increased remote working. Apartment units have become a place of work and leisure, and there are no signs of that changing anytime soon.
With the majority of companies continuing to emphasize a work-from-home order, management companies will need to continue adjusting their offerings to meet resident needs in the short and long term. This ranges from providing better high-speed internet packages, getting creative and developing socially distant coworking spaces and establishing wellness-focused areas to help residents balance the challenge of working and living within the same space consistently. The goal should be for all multifamily companies to adapt quickly and implement feedback from their residents to ensure success in strengthening resident retention and satisfaction.
Overcommunicate Along the Way
In order to organically build the trust and rapport needed to work as partners and be allowed to take those risks and make quick changes, communication is key.
Consistent conversations are imperative due to the ever-evolving lifestyle of real estate. Initial goals will likely shift along the way so it’s important to maintain regular contact and overcommunicate at all times.
Property managers should ensure consistent conversations are happening in order to get ahead of a shift in strategy—it may sound simple, but clients appreciate it more than you might realize. By doing this, you can revisit and pivot as necessary when market curveballs are inevitably thrown your way.
Likewise, overcommunicating with residents is just as essential. Enhanced customer service has become one of the most critical components for demonstrating value, improving resident satisfaction across communities, and standing as a differentiator within the property management community.
Elevated expectations are on the rise as more residents work from home, so it will become crucial for timely communication and quick issue resolution to remain essential strategies for solid customer service. Additionally, we foresee most residents leaning into digital communication via smartphone apps, emails or text alerts for updates and ongoing communication with on-site teams. For multifamily operators, that means expanding your digital resources and increasing the frequency of communication in 2021 and beyond to ensure resident trust and satisfaction.
At the end of the day, thinking and planning beyond the operating budget will benefit everyone from the owners of the assets to those doing on-the-ground work. Being able to form a joint partnership and working with an owner’s mindset will ensure the mission is clear at all levels, making for happy associates and clients.
Jason Berkowitz is the founder & CEO of RPM Living, a full-service property management, development and investment company offering an innovative and personalized approach to real estate management services.