Reinventing Older Properties
- May 07, 2013
They say time waits for no man, and that is true of multifamily properties, too. What may have been a top-tier luxury apartment building when it was built is now dated compared to the new crop of buildings hitting the market. But savvy multifamily investors know some of these older properties can easily regain their former Class-A status—and value—with the right renovations.
At RMK Management Corp., we have nearly 30 communities under management in Illinois, Indiana and Minnesota, and more than half were built before 1990. So we have considerable experience in working with owners and investors to bring new appeal to an older property.
For example, in February we partnered with Atlanta-based RADCO Companies to oversee the renovation of a 226-unit, Class B community completed in 1989 in Geneva, Ill., a northwest suburb of Chicago. This rental community is a great example of reinventing an older property.
Like many, we started with an attractive, well-located and well-built community with a stable resident profile—a property with tremendous potential for a reinvention. But what do you do after you determine a property is ripe for such reinvention?
The first step one may want to consider is renaming the property. If the current name of the project is associated with an outdated building, then changing its name is a great first step in creating a new image—which is exactly why we renamed Brittany Court Apartments as Ashford at Geneva. This was done not only to give the development fresh appeal in the eyes of future Geneva residents, but also to keep the name consistent with the brand of the well-known and well-respected RADCO Companies.
The next step you might want to consider in your apartment reinvention is making physical improvements to the exterior of the development. A little facelift can help any community feel fresh and new. At Ashford at Geneva, we decided to enhance the property’s curb appeal by adding shutters, installing new signage, upgrading the patios and balconies, and replacing older landscaping.
Interior remodeling can also make a drastic improvement to any community reinvention. Inside Ashford at Geneva, we will be upgrading the amenities to include a newly constructed clubhouse with a cyber café and fitness center. We will also be rehabbing the hallways and replacing the lighting and entry doors. Additionally, each unit is getting a new look with a renovated kitchen and bath. The end result will be a more modern appearance and feeling throughout the community and residences.
However, the reinvention of Ashford at Geneva will go beyond the physical property, which brings me to another step in the reinvention process. Do the services offered at the reinvented property need to be updated as well? Is your property management team giving it their all, or could they be providing more TLC to residents?
As an RMK-managed community, Ashford at Geneva will now feature all the hallmarks of our management philosophy. This includes monthly resident events, an annual resident appreciate celebration, quarterly satisfaction inquiries, lease-renewal parties and a menu of technology-based tools that allow residents to pay their rent or make a maintenance request from an online resident portal.
We take a lot of pride in our relationships with our residents, and that relationship is especially important when there is a change in the ownership and management of a community.
As a result of our efforts to reinvent Ashford at Geneva, we anticipate continued strong occupancy rates and improved resident satisfaction, and we expect the property to command higher monthly rents for every unit. Ashford at Geneva’s reinvention also will make it an even more attractive asset for RADCO’s investment portfolio.
By taking a 360 degree approach to your next property reinvention—looking at physical improvements as well as enhanced services and property management—you can create not only a new and improved image for the property, but also a better living experience for current and future residents so that the real estate asset can compete with the new Class A kids on the block.
Diana Pittro is executive vice president of Chicago-based RMK Management Corp.