Remember back in school when the teacher would “teach reading” by having each child read aloud from the book? Well, I was the one who would grow impatient and read ahead so much so that when it was my turn I would have to go back several pages and ask from which paragraph I should start. A bit arrogant, you think? Perhaps, yes. It was certainly not a charming characteristic on which to capitalize, especially not in the third or fourth grade. I always wondered if there wasn’t a more effective way to teach reading fundamentals than by embarrassing those who couldn’t by singling them out in the most humiliating way possible?
I am reminded of this situation again in property management when I often find that Owners/Investors, the Corporate Office and the on site teams are many times not only NOT on the same page, but sometimes not even in the same book in the right chapter. This most happens when a property is in “transition.” When properties are bought and sold, when a new management company is hired to “right the ship”, or when a current management company dissolves a partnership, for example, oftentimes, the vision becomes nearsighted, farsighted or suffers from some form of astigmatism. Besides providing proper eye-wear, the question that follows is: whose vision needs to be defined and who is responsible for achieving it?
Unfortunately, what happens most often is a the Management Company or Owner decides to try tactics to “turn the property around” and hires a new manager, leasing consultant or even a new team entirely and expects them to understand the “plan.” However, the “plan” must consist of a consistent method of construction, renovations, and marketing. Any inconsistency is surely to produce disappointing results, cause confusion and doom the project to failure.
Construction: Taking out walls, removing overgrown, unattractive landscaping, installing new signage, remodeling clubhouses, installing retaining walls, sealing, striping parking lots, and revitalizing tired, worn out pools are all vital to the rebranding of the property.
Renovations: Adding amenities to interior living spaces must be carefully considered. This is the area where an inexperienced Owner is most likely to make mistakes. Either they choose items that will not give an appreciable return on their investment or choose to spend money on granite counter tops, travertine tiles or stainless steel appliances when a better alternative would be buying energy star appliances (does not have to be stainless), installing energy efficient windows, replacing roofs (thus eliminating those pesky water leaks!), installing new cabinetry with basic updated easy-to-use faucets, updating thermostats with programmable ones, and replacing worn carpets and tile with a nice laminate or hardwood floor.
Marketing: The worst thing an Owner can do is choose to update one thing in one unit and something else in another. Without a consistent plan of action, the marketing plan is without consistent pricing and this will make it next to impossible for the Leasing Team to understand the pricing model. This may in turn interfere with their product knowledge and confidence in leasing the checkerboard product.
The best thing investment strategy an Owner or Management Company implements should address the vision and mission. It starts there and everything done afterward should support and defend this vision. If the vision is nearsighted, inconsistency of interior units occurs. If the vision is farsighted, there may be a problem with the capital plan, and if there is astigmatism of vision, the entire focus is skewed.
The increased occupancy, along with the continued renewals, will let Ownership and Management know if the vision needs to be rechecked. Any slippage in direction will allow revision of the overall plan so that all levels will be on the same page, in the right chapter within the same book all the while achieving 20/20 vision.
Mindy Sharp, COS; CAM, is a licensed real estate professional with 14 years of property management experience and is currently a Property Manager with Infinity Management Group.
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