We Push Our Rents As Much As We Can
- Mar 03, 2010
Debbie Vail has been named regional manager of Dominium Management Services. In this position, Vail will manage a portfolio of Section 42, Section 8 as well as market-rate properties in Colorado and California. Her duties will include customer service, market analysis and positioning, asset preservation, personnel management and maximizing investors’ returns.
She talks to MHN about the challenges she faces and why she believes a focus on customer service is key to the success of the company.
MHN: What are the biggest challenges you are facing this year?
Vail: I don’t see a lot of growth coming up this year. The best we can hope for is to stabilize. If there is an increase in income and occupancy I get extra points. We budgeted less aggressively for occupancy this year. My goal is to stabilize the properties in this region and get profit.
MHN: How are Section 42 properties in your portfolio performing?
Vail: All of my properties in Colorado are section 42 and/or market-rate. Section 42 is doing very well. We can’t complain about that. Most of our vacancy is in the market-rate section of the portfolio. I have seen a lot of movement in last two years with a large percentage of turnover. It is going to take a lot more work to be stable. My portfolio in Colorado is 94 percent occupied right now, which considering economy isn’t bad but we’d like to see a gain of another couple of points. I’d like it to be 96 percent—this would give us the cushion we need because we are going to see a lot of turnover this year as well, with people moving around for jobs.
MHN: What are the challenges of managing a Section 42 portfolio?
Vail: There is a larger burden of paperwork on onsite staff and compliance is always going to be a big issue. But we want to make sure everything is right so we have a third-party compliance department in our corporate office where the processing takes place. We avoid a lot of mistakes that way. There is a huge responsibility for following the rules.
Due to the recession, a lot of people are leaving the area because of loss of jobs, and a lot more evictions are taking place. We don’t get a lot of notice and don’t get time to notice.
MHN: One of your focus areas is customer service. Why?
Vail: I oversee all operations of these properties and customer service has always been one of my major focuses. It is a major element that’s contributed to our success. For people who already live here, we have to give them good service because we don’t want them to move out. We want them to renew leases and be comfortable in the community.
As for people walking in the door, if we aren’t on top of our game that moment, we aren’t going to convert that rental and with the turnover we are seeing, we have to capture a high percentage of people coming in.
MHN: How do you plan to the increase net operating income of your portfolio?
Vail: We watch the market very closely and watch the trends and our expenses. We push our rents as much as we can. Our focus is to put out the best product out but also to get the best price. We have weekly market surveys that keep track of who is getting a lot of traffic and who is increasing rents. If another property is getting more traffic, we evaluate if we need to re-focus our marketing areas.
MHN: Is there rent growth in Colorado?
Vail: Rent growth is minimal. We are getting some but not as aggressive as in the past years. At this point it is important for us to not push rents to the point that we push people away or be too pricey to rent.
MHN: Are you still offering concessions at your market-rate properties?
Vail: We are still offering concessions. But several months ago packages of two months free rent were not unusual and now we are offering $300 $400 off on certain units in certain communities. We aren’t giving away as much.