Property Management: Rocking Resident Retention
- Dec 12, 2013
By Keith Loria, Contributing Editor
Maximizing resident retention is an important component to the success of any multifamily property. For some residents, the ultimate goal is to purchase a home, so an important goal is to sell the services and benefits of apartment living that make the residents’ lifestyle easier and worry-free.
You need to always be thinking of new ideas to get your residents involved and solicit feedback. The last thing you want is to have someone move in and not see them until their lease expires and they move out.
“In this day and age, it is easy to get caught up in communicating via computers and tech devices, but that cannot be a replacement for leaving your office and walking the community during the day and at night,” Tracey Carboun, regional performance director for Alliance Residential Company, says. “This is an invaluable opportunity to ensure everything is in working condition and evaluate whether you would grade your community inspection at an A+. If not, you’ll know exactly what needs to change.”
Shailene Casio-Smith, FirstService Residential Realty’s vice president of business development, says the tried and true method is consistent execution; the best practices depend on your resident profile and submarket dynamics.
“Survey your residents upon move in and ask them what they want. Gather their feedback throughout their residency to keep your programs current and in tune with the changes in their lives and lifestyle,” she says. “Know your residents and be intimately acquainted with the dynamics of your submarket. Build a resident retention program specific to your resident profile and what’s happening in the area, then execute the program on a consistent basis.”
Peter Febo, Taconic Investment Partners’ senior vice president, who oversees Taconic Management Company, says when you deal with moderate-income residents, amenities such as a community center and after-school care are important.
“You not only want to offer the best value for the customer, but things that make their lives better on a day-to-day basis,” he says. “We have a moderate-income property we manage in New York, and because the city cut the funding for afterschool care, we converted our community center from the hours of 1-6 p.m. into an afterschool program and it took a big burden off of our residents. That helps with retention.”
Challenges to overcome
Every segment (Class A assets versus Class C) have different challenges due to their value proposition and resident profile. However, the overriding challenge for most properties is ensuring residents are aware of and perceive the property’s value proposition so price points (rents) don’t become the primary factor in a resident renewing their lease, or choosing to give notice to vacate.
Del de Windt, CEO of Cardinal Group Management, says one of the biggest challenges the company faces is parody within the market.
“Apartments can offer the same physical amenities and features, but the intangibles are what can separate you from your competitors: brand, customer service and community,” he says. “Build a sense of community and genuinely care for your residents. You are not just offering four walls and a roof, that’s your competitor.”
Today’s consumers are smarter than they have ever been. They are constantly bombarded with ads for new communities and varying apartment home specials; as a result, they will ask tough questions when faced with a rent increase.
“That means we need to offer competitive pricing for a high-quality product and capitalize on selling the value of living at our community,” Carboun says. “Doing this effectively begins with market and product knowledge, followed by the ability to sell our company, our team and our services, while simultaneously assuring our residents they are going to be well taken care of.”
Tips for success
Retention is about maintaining a “lifestyle” for your residents—from following up with service requests, to offering housekeeping or plant watering services to residents who travel frequently, to hosting wine and cheese parties instead of margaritas and nachos.
“Perform unexpected, random acts of kindness to your residents,” de Windt says. “This can earn a customer for a lifetime and influence their sphere of influence, which often times are potential customers as well.”
According to our experts, success is defined by how well you connect with your residents and prospects and it all starts the moment you meet your prospect—you want to find out how their life works. This provides valuable information on what is important to them, and remembering this information is key. Make notes and refer back to them as needed. Similarly, detailed notes will help your team quickly identify what is important, which is imperative because resident retention is a team effort.
“Always be responsive to a customer whether they will like the answer or not,” Febo says. “Get them an answer quickly and resolve the issue in a friendly way. There’s nothing worse than an unresponsive landlord.”
Carboun advises to always stay connected and make the most of every interaction.
“Small touches, such as a simple birthday card, or thinking to ask how a trip or event went for the resident, have a huge impact,” she says. “Get to know each resident and let them know you care. Surveys are informative and important, but unless you follow up, you can’t make an impact.”
Out of the box
The industry is starving for fresh, relevant ideas, such as the electric vehicle charging station as part of the green amenities at Alliance’s Broadstone Grand Avenue in Pflugerville, Texas. One thing’s for certain, staying status quo is not the way to go.
You can’t stop renters from wanting the American dream of home ownership, so why not assist them by giving them an incentive for choosing your property over others, and an incentive to stay a little longer? That’s the reasoning behind FirstService establishing cross-promotional efforts with local home builders that provide residents with home purchase/home building “credits” based on the length of their residency at a property.
“This creates a true value proposition for the residents and postures them for the next phase in their lives: home ownership,” Casio-Smith says. “Why would the resident move to another property with such a large incentive at stake at their current community? The property benefits from the extended retention. The builder has exclusivity to the property and benefits from the captured audience. It’s a win-win for all.”
When Carboun worked on-site, she once organized a “Resident Appreciation Week,” which was so well received that the residents banded together the following week to throw an “Office Appreciation Week.”
“My thought was that everyone has resident events, but I wanted to dedicate a full week to showing our residents how much we care. We showered our residents each day with various tokens of appreciation—from little things such as candy bars at the mailboxes to a big party at the end of the week,” she says. “Our goal was to ‘touch’ every resident at the community, and they loved the level of attention and care we displayed across each day’s event or effort.”
Cardinal has recently created internal competitions between its communities, breeding the competitive spirit across the company and helping to get everyone thinking about ways to make residents’ lives better.
“We keep an open ear and proactive approach to a resident’s feedback,” de Windt says. “This gives us the best intel on what we are doing well and where we need to improve to better serve our residents.”
Learning from mistakes
Simply showing up at the office, taking service requests and being nice is not enough. You have to invest time and energy to connect and build relationships with your residents. In addition, specific efforts may not work and it’s important to reflect on why.
“If you host an event and do not see great turnout, take a step back and analyze all aspects,” Carboun says. “Was it due to how—or how often—the event was marketed? Was it the timing? Did the event not appeal to what your residents enjoy? Asking these questions will help you better understand how to be more successful with the next event or initiative.”
It’s important to note that resident retention is not a one-size-fits-all model. It’s about providing customized solutions and services to that specific property that will make retention successful.
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