Looking at returning to property management, I also completed reading the book, "What color is your parachute." This book talks about expanding your horizons both in a soft job market and to look at alternative positions you could explore and be happy with. As an example, before apartment management I managed enclosed malls and had my introduction into property management with the office side of the industry. Today we also have HOA management, condominium management, other facilities and asset management with similar tasks and challenges. I always knew hospitality or hotel management was similar in many ways, having hired a few great people from this industry. This has led me to look at similar industries as well as alternative positions.
In todays ever changing business environment, we cannot limit and should not limit ourselves. Being open also creates new opportunities. As an example, I have no reluctance in accepting a site position with the right company. Unfortunately, several interviews I have had all led to the same concern, "You know you are over qualified." In one interview the person interviewing me made the statement three times, as if expecting a different response each time. Of course after the second time she made the statement I am thinking the interview is basically over and her mind has already been made up as to further consideration. My response has been, "it is not about a title, it is about doing what I love and which is property management." In the past I have hired leasing personnel who were at one time managers, and others who some might look at as over qualified. I remember a manager as we were reviewing resumes ruling out candidates because of her perception they were "over qualified." I realize hiring someone with higher level positions can be perceived as intimidating and might to some feel threatening. I have always had two thoughts on this.
1. I would rather hire someone that is over qualified than under qualified.
2. You should only feel threatened in hiring someone with a higher experience level if you are unsure about your ability to lead them.
I also hear candidates being left out of consideration because they are unemployed. Hey guys, this sure doesn't help unemployment and you might be excluding some really good people out there that don't have a job because of situations outside of their control. Downsizing, or up-profiting as I call it has happened in our business just as it has in other industries. Just as I have expanded my horizons and possibilities of positions I am looking at, I encourage those interviewing to expand theirs as well. Maybe...just maybe they will find someone who can will exceed their expectations and help you become more successful because they took the chance and gave them the opportunity.
Tuesday, December 20, 2011
Friday, November 18, 2011
Taking risks by not eliminating them
Risk management is something we should be proactive at, understanding we can never completely eliminate risks just minimize them. In the litigious society we live in today, our communities/residents and our people are open to hundreds of risks every day. From a piece of broken sidewalk causing a trip hazard, to fair housing and the traps inherent with leasing and residents, our communities and team members are faced with challenges we often know of but fail to be proactive on.
The physical risks can include the fixtures and improvements, but also include the natural occurrences and habitat. Neglecting a tree root near a playground can be just as significant as the tree root that raises a sidewalk causing a very visible trip hazard. Tree limbs hanging down at head level are obvious, however, those over grown bushes where someone could hide behind near the entrance to a building or apartment also should be identified and corrected. A recent budget discussion I had for some consulting work had no funds allocated in addressing issues they knew they had. Having identified these concerns and then failing to budget to correct them could lead to perceived negligence, opening them up to increased liability. When I asked about their position on this I was simply told, "we'll address if it gets worse or we have a problem with it." The manager stated she had put tree trimming and sidewalk repairs in the budget last year, only to have it removed so this year she didn't even consider placing it in the plan. When I asked how much their insurance had increased in the last five years the response with "significant." I also asked them how many claims they had in the past three years dealing with these types of issues, stated they had eleven or twelve. I requested they contact their insurance carrier about how much that impacted their increases, and what dollar amount it may have factored into their premiums (outside of normal increase history we are seeing). The response they received opened their eyes to the purpose of my inquiry and concern. The agent talked to their underwriting department and stated the estimate based on their loss structure the premium increased was approximately six thousand dollars just this past year. When reviewing the total estimated repairs to correct the identified areas a number of $3,200 was provided. Three of the areas were documented as being hazards still not corrected from incidents over the last two years and budget periods. Needless to say they made corrections to their budget and did a review of all of their sites finding similar traits.
As property managers, our fiduciary responsibility is to identify and submit corrective action on these types of risks. If ownership or upper management takes them out, maybe...just maybe we didn't do our homework and "sell" the budget item correctly. Providing pictures and loss history along with some of the research I recommend may have prevented or reduced higher premiums and the time as well as personnel resources to handle these claims. Simply not acting because of past trends is neglectful on our part, and is adding to what we are seeing with increased premiums. I also recommended sending the insurance carrier corrective measures taken before renewal and asked them to contact the carrier and identify if this would help in their evaluation of premiums.
Risk management is everyones job, and your entire team should be alert to possible risks and know the procedure for reporting. Limbs over roof lines during a storm can cause significant damage to gutters and shingles, which is one of the most frequent items I discover in doing site evaluations. Some of these areas are so simple to correct and can save thousands in deductibles, hours spent to address, and possible human injury or even death. Taking time each month to review your community or property from a risk standpoint is your responsibility and obligation as a professional property manager.
The physical risks can include the fixtures and improvements, but also include the natural occurrences and habitat. Neglecting a tree root near a playground can be just as significant as the tree root that raises a sidewalk causing a very visible trip hazard. Tree limbs hanging down at head level are obvious, however, those over grown bushes where someone could hide behind near the entrance to a building or apartment also should be identified and corrected. A recent budget discussion I had for some consulting work had no funds allocated in addressing issues they knew they had. Having identified these concerns and then failing to budget to correct them could lead to perceived negligence, opening them up to increased liability. When I asked about their position on this I was simply told, "we'll address if it gets worse or we have a problem with it." The manager stated she had put tree trimming and sidewalk repairs in the budget last year, only to have it removed so this year she didn't even consider placing it in the plan. When I asked how much their insurance had increased in the last five years the response with "significant." I also asked them how many claims they had in the past three years dealing with these types of issues, stated they had eleven or twelve. I requested they contact their insurance carrier about how much that impacted their increases, and what dollar amount it may have factored into their premiums (outside of normal increase history we are seeing). The response they received opened their eyes to the purpose of my inquiry and concern. The agent talked to their underwriting department and stated the estimate based on their loss structure the premium increased was approximately six thousand dollars just this past year. When reviewing the total estimated repairs to correct the identified areas a number of $3,200 was provided. Three of the areas were documented as being hazards still not corrected from incidents over the last two years and budget periods. Needless to say they made corrections to their budget and did a review of all of their sites finding similar traits.
As property managers, our fiduciary responsibility is to identify and submit corrective action on these types of risks. If ownership or upper management takes them out, maybe...just maybe we didn't do our homework and "sell" the budget item correctly. Providing pictures and loss history along with some of the research I recommend may have prevented or reduced higher premiums and the time as well as personnel resources to handle these claims. Simply not acting because of past trends is neglectful on our part, and is adding to what we are seeing with increased premiums. I also recommended sending the insurance carrier corrective measures taken before renewal and asked them to contact the carrier and identify if this would help in their evaluation of premiums.
Risk management is everyones job, and your entire team should be alert to possible risks and know the procedure for reporting. Limbs over roof lines during a storm can cause significant damage to gutters and shingles, which is one of the most frequent items I discover in doing site evaluations. Some of these areas are so simple to correct and can save thousands in deductibles, hours spent to address, and possible human injury or even death. Taking time each month to review your community or property from a risk standpoint is your responsibility and obligation as a professional property manager.
Friday, October 28, 2011
Marketing for the new age!
My how things have changed over the past twenty years related to marketing. We have gone from a day when newspaper and magazine publications were the primary mediums to an age of technology and electronic marketing taking center stage. Today we update postings on Craigslist several times a day, rely on outside sources to insure we get clicks on internet sites, and have more choices as to where to spend our marketing dollars than ever before. Now magazine publication web sites and Internet locations specifically directed at getting our communities in the eye of our prospects are our primary source. We are also faced with sites where residents can have what they "feel" is a bad experience at the management office at 9:00 AM, and by 9:15 have something negative posted for millions of people to see. Our industry has gone from research by a site team about market conditions being the primary determining factor on rents and leasing, to computer programs that can change rents several times a day based on leasing trends and market data from external sources.
Talk about hitting a moving target, and you talk about what is happening in our business today and how fast technology is changing how we manage and lead our teams. This raises questions related to how much staffing do we need to balance the marketing and leasing tasks, how do we use and obtain market analysis data, where do we place our limited advertising dollars, how do we manage our time with keeping Internet information updated, and are we depending so much on technology we forget we deal with people both in our office and those that come through the door? So many questions and so many answers we can be faced with.
Since we have already identified everything is changing at a rapid pace, one of the first areas we need to address is flexibility. Do our team members have the ability to multi-task in addition to being able to absorb and use the technology that is out there? A great example of this is with Craigslist, and how it has evolved. Then we have the use of YouTube, Google, apartment rating site monitoring, and of course Facebook and Twitter. Several recent discussions on Multifamily Insiders opened up these formats and how to use them. This next brings us to sites like this which now should be monitored as information and training platforms related to effective and efficient electronic medium use. Keeping up with these trends and new information can mean the difference between staying ahead or with the curve or being re-active and behind the curve. Here we should have someone from the site or training department within a company monitoring this information and passing it on and helping our site teams understand the efficacy as well as changes to help them exceed and excel. Are site teams using resources to help them manage their time such as calendar reminders and sharing data between management company sites both in and outside of a market? My research is showing we are not using these tools or sharing technology information and tools effectively or efficiently to maximize Net Operating Income and occupancy.
This past week I was asked to evaluate two communities as part of a job interview process. I did the phone shop, site visit, and property evaluation with some results that showed not everyone is using the tools available to us. This included providing a copy of a copy of a leasing brochure versus a PDF copy being printed that had been cleaned up for professionalism. I am guessing they maybe just ran out of original professional color brochures, which is a whole other topic raising many other questions. I received follow-up from only one site leasing person on the phone. The other leasing person I never heard from, even though they had both my phone number and email address. Did I get lost in the shuffle? Were they not organized or using easily accessible tools so follow-up was less of a burden? Was there no leadership checking on visitor follow-up because they were too busy doing other things? Another interview took me to reviewing a company and their marketing. When going to their site pages on Apartments.com, there was a "management" section where your the link to your company web site can provide valuable information for someone reviewing who they are choosing to live with for their next home. If you clicked on this link it said, "Object has moved here," with the "here" being in blue showing it was available to take you to another link. Unfortunately this link came back with an error message, and I am sure from a prospect situation would cause frustration. Remember, we expect everything in the "techno world" to be right and easily accessible. How long had this link not been working, and who was responsible for checking it? Now don't get me wrong in assuming I haven't missed things like this in my career because I have. Guess what I am saying is the complex environment is ever changing and we constantly have to be evaluating and checking our marketing. Some of you may have heard the following quote:
This is a story about four people named EVERYBODY, SOMEBODY, ANYBODY and NOBODY. There was an important job to be done and EVERYBODY was sure that SOMEBODY would do it. ANYBODY could have done it, but NOBODY did it. SOMEBODY got angry about that because it was EVERYBODY'S job. EVERYBODY thought that ANYBODY could do it but NOBODY realized that EVERYBODY wouldn't do it. It ended up that EVERYBODY blamed SOMEBODY when NOBODY did what ANYBODY could have done!
These and other questions all relate to the marketing and leasing aspects of how "complex" our business has become. I will say this again and again, this is not rocket science and it all boils down to one area...leadership. This is why we as leaders must insure we understand this new age of marketing, and how we must develop others we work with to be the best at what we can be. Hold on tight, as we already have identified the ride has probably just begun!
Friday, October 14, 2011
How to difuse the emotional bomb - Conflict Resoluation
Face it, the property management industry is faced with many challenges related to potential conflicts. In no other business can we touch so many emotional issues than in property management. Whether it be finances, pets, homes, cars, employees, children, fair housing, personal property, etc., we have so many opportunities where conflict can be a part of our lives. Our industry is unique in this regard as well as challenging.
How we handle and address these challenges and how the members of our teams handle them is critical in so many ways. We tell employees when we hire them how wonderful our organization is, what fantastic benefits we have, what opportunities are waiting, however, we fail to warn or train/condition them for the conflict they will most likely be faced with. Companies and associations teach fair housing, marketing, financial analysis, budgeting, risk management, and other topics, but few provide tools to address conflict related to residents and employees.
The first rule when dealing with emotional issues is the most important. To control the emotions of others when dealing with conflict, you first must learn to control your own. Getting in a "pissing match" with a resident, employee, or applicant will do nothing more than amplify the situation and make things worse. I am being blunt about this first rule, because more times than not I see team members getting emotional themselves with dealing with conflict they are faced with. We have all had the resident fly into our office like a ten year old on a sugar high, spitting fire out of every orifice of their body. If you have not...you will. I know most managers have also had to deal with employee issues where "going postal" was a though in the back of their mind. I'm sure the US Post office hates that term, however, we'll use it for now. There are several things we can do to diffuse conflict, if nothing else but reduce the circumstances that can result from an unfavorable situation.
Rule 1: See above. Keep your emotions in check. The more you are in control, the more you can control the situation. Once you lose internal control, you lose control of the chance of a favorable outcome.
Rule 2: If possible, take the situation to a favorable environment. This means out of other employee or public view, and into a private setting. Last thing you need is a resident screaming at you while a prospect is coming in the door.
Rule 3: If you feel threatened, don't address the conflict alone. There are times when having someone else with you as a witness or if you feel threatened is needed. If you are not comfortable or you are being threatened, do not go into a room by yourself. This goes for both men and women and address the situation not the issue.
Rule 4: Don't address the other person (employee or resident) from behind a desk. The desk is a barrier and will be seen a such. I know, you may feel you need this for your protection and if you do...see Rule 3 above.
Rule 5: Set the groundwork for the discussion. "Mrs. Smith, I can see you are emotional about this situation and understand your concern. Before we have an open dialogue, I will respectfully ask that we both remain professional and address the facts and keep emotions in check. Can we do that?" This sets the stage for taking emotions down a notch in many cases and lets the other person know you are understanding about their feelings that are in play. Most of the time after stating this I see the other person lean back in the chair, take a breath, and think about what they are doing.
Rule 6: Take notes. I always let them know I am doing this, even though it may be obvious. "Mr. Jones, so I can properly document your concerns and have an understanding of the situation, I will be taking notes. I trust you will allow me to do that." This again is a great tool for further taking the emotions in check, as they see you "documenting" what is being said. It also is a great sign you are paying attention to them and their concerns.
Rule 7: Allow them to talk, and provide the "dramatic pause" before responding. One of the worse things you can do in a conflict situation is to talk over the other person. It tells them you are not listening, and in many cases no matter what is said gives them the feeling you are not open as a mediator. Pause after they have apparently finished a statement, and in some cases they may be just getting started. You may also find this pause brings out additional information you would not have gotten had it not been there.
Rule 8: Look them in the eyes, shut off your phone, turn off your computer, and ask the people in the front office to allow for a few minutes to not be interrupted. Looking at your computer screen, checking your email, starring at your Blackberry, all are signs to them you are not giving them the attention they feel they deserve. I usually say, "So you can have my undivided attention, please give me a moment to turn off my computer screen and silence my phone." This also seems to bring the tension level down and show you are attentive.
Rule 9: After completing the session, go back over your notes and in particular their concerns with them. This shows you did pay attention and document the conversation. "Mrs Davis. So we can make sure we have an understanding of your concerns let me re-state from our notes what has been presented." You will also notice no where in that statement did I use the word "I." It was "we" and "our," as referenced in the above statement.
Rule 10: The response or answer and how and when to present. There are times, even though you know the answer is no, you may want to delay your answer until a later time. Serious situations sometimes demand immediate responses, and some times delayed responses. If there are questions that you could not answer or to show you are open in your findings, don't respond at that time. Failure to show you are "carefully" looking at all the details and being fair in your analysis may bring on further conflict. "Mr. Thompson, I have additional details I need to further investigate so we may be fair and professional in making the correct resoluation. Will you allow time to insure I have all the facts correct and fully check the information for a fair resolution? Can I get back to you by tomorrow morning?" This again tends to diffuse the situation and further lower the tension levels. Just make sure you get back to them as promised. On the other hand if the answer is and will be "no," don't tell them no! What? Are you saying don't give them an answer? No, I am saying you need to find a way to say "no," without saying no. As an example: "Mr. Goodfellow, after reviewing all of the information removing the late fee considering your rent was late is not an option we have." Here I have said "no," without saying "no." If they have also used the "fairness" issues in their discussion, turn this back to them. "You have stated you want fairness in your comments. Mrs. Happy, would you agree that it would be unfair for me to do something for another resident I could not do for you?"
Rule 11: Don't dismiss them, walk them out. They are not in school and you are not their parent. Offer to shake their hand, even if they do not offer theirs. Be professional, and show that you can be professional even after taking all that has been handed to you by the employee or the resident.
Train your staff how to deal with conflict and review how you deal with it as well. When interviewing I ask employees the good, the bad, and the ugly questions. "Tammy, we all know customer service is important and not in all cases do we deal with happy people. If a resident comes flying in the office upset and somewhat out of control, how are you going to handle it?" This tells me how they would handle, and if they have been trained to deal with these types of situations. I have met managers in the business for twenty years, yet they not only will do everything to avoid conflict but don't know how to handle it. It is our responsibility to insure they have the tools necessary, even then faced with bad situations including conflict. Be a leader!
How we handle and address these challenges and how the members of our teams handle them is critical in so many ways. We tell employees when we hire them how wonderful our organization is, what fantastic benefits we have, what opportunities are waiting, however, we fail to warn or train/condition them for the conflict they will most likely be faced with. Companies and associations teach fair housing, marketing, financial analysis, budgeting, risk management, and other topics, but few provide tools to address conflict related to residents and employees.
The first rule when dealing with emotional issues is the most important. To control the emotions of others when dealing with conflict, you first must learn to control your own. Getting in a "pissing match" with a resident, employee, or applicant will do nothing more than amplify the situation and make things worse. I am being blunt about this first rule, because more times than not I see team members getting emotional themselves with dealing with conflict they are faced with. We have all had the resident fly into our office like a ten year old on a sugar high, spitting fire out of every orifice of their body. If you have not...you will. I know most managers have also had to deal with employee issues where "going postal" was a though in the back of their mind. I'm sure the US Post office hates that term, however, we'll use it for now. There are several things we can do to diffuse conflict, if nothing else but reduce the circumstances that can result from an unfavorable situation.
Rule 1: See above. Keep your emotions in check. The more you are in control, the more you can control the situation. Once you lose internal control, you lose control of the chance of a favorable outcome.
Rule 2: If possible, take the situation to a favorable environment. This means out of other employee or public view, and into a private setting. Last thing you need is a resident screaming at you while a prospect is coming in the door.
Rule 3: If you feel threatened, don't address the conflict alone. There are times when having someone else with you as a witness or if you feel threatened is needed. If you are not comfortable or you are being threatened, do not go into a room by yourself. This goes for both men and women and address the situation not the issue.
Rule 4: Don't address the other person (employee or resident) from behind a desk. The desk is a barrier and will be seen a such. I know, you may feel you need this for your protection and if you do...see Rule 3 above.
Rule 5: Set the groundwork for the discussion. "Mrs. Smith, I can see you are emotional about this situation and understand your concern. Before we have an open dialogue, I will respectfully ask that we both remain professional and address the facts and keep emotions in check. Can we do that?" This sets the stage for taking emotions down a notch in many cases and lets the other person know you are understanding about their feelings that are in play. Most of the time after stating this I see the other person lean back in the chair, take a breath, and think about what they are doing.
Rule 6: Take notes. I always let them know I am doing this, even though it may be obvious. "Mr. Jones, so I can properly document your concerns and have an understanding of the situation, I will be taking notes. I trust you will allow me to do that." This again is a great tool for further taking the emotions in check, as they see you "documenting" what is being said. It also is a great sign you are paying attention to them and their concerns.
Rule 7: Allow them to talk, and provide the "dramatic pause" before responding. One of the worse things you can do in a conflict situation is to talk over the other person. It tells them you are not listening, and in many cases no matter what is said gives them the feeling you are not open as a mediator. Pause after they have apparently finished a statement, and in some cases they may be just getting started. You may also find this pause brings out additional information you would not have gotten had it not been there.
Rule 8: Look them in the eyes, shut off your phone, turn off your computer, and ask the people in the front office to allow for a few minutes to not be interrupted. Looking at your computer screen, checking your email, starring at your Blackberry, all are signs to them you are not giving them the attention they feel they deserve. I usually say, "So you can have my undivided attention, please give me a moment to turn off my computer screen and silence my phone." This also seems to bring the tension level down and show you are attentive.
Rule 9: After completing the session, go back over your notes and in particular their concerns with them. This shows you did pay attention and document the conversation. "Mrs Davis. So we can make sure we have an understanding of your concerns let me re-state from our notes what has been presented." You will also notice no where in that statement did I use the word "I." It was "we" and "our," as referenced in the above statement.
Rule 10: The response or answer and how and when to present. There are times, even though you know the answer is no, you may want to delay your answer until a later time. Serious situations sometimes demand immediate responses, and some times delayed responses. If there are questions that you could not answer or to show you are open in your findings, don't respond at that time. Failure to show you are "carefully" looking at all the details and being fair in your analysis may bring on further conflict. "Mr. Thompson, I have additional details I need to further investigate so we may be fair and professional in making the correct resoluation. Will you allow time to insure I have all the facts correct and fully check the information for a fair resolution? Can I get back to you by tomorrow morning?" This again tends to diffuse the situation and further lower the tension levels. Just make sure you get back to them as promised. On the other hand if the answer is and will be "no," don't tell them no! What? Are you saying don't give them an answer? No, I am saying you need to find a way to say "no," without saying no. As an example: "Mr. Goodfellow, after reviewing all of the information removing the late fee considering your rent was late is not an option we have." Here I have said "no," without saying "no." If they have also used the "fairness" issues in their discussion, turn this back to them. "You have stated you want fairness in your comments. Mrs. Happy, would you agree that it would be unfair for me to do something for another resident I could not do for you?"
Rule 11: Don't dismiss them, walk them out. They are not in school and you are not their parent. Offer to shake their hand, even if they do not offer theirs. Be professional, and show that you can be professional even after taking all that has been handed to you by the employee or the resident.
Train your staff how to deal with conflict and review how you deal with it as well. When interviewing I ask employees the good, the bad, and the ugly questions. "Tammy, we all know customer service is important and not in all cases do we deal with happy people. If a resident comes flying in the office upset and somewhat out of control, how are you going to handle it?" This tells me how they would handle, and if they have been trained to deal with these types of situations. I have met managers in the business for twenty years, yet they not only will do everything to avoid conflict but don't know how to handle it. It is our responsibility to insure they have the tools necessary, even then faced with bad situations including conflict. Be a leader!
Saturday, October 1, 2011
Financial Conditioning
Earlier today I was responding to a post on MultifamilyInsiders.com related to increasing rents, adding services, and dealing with "unhappy campers." In the discussion I thought about how we as an industry have not done a very good job of conditioning and educating our managers and teams related to the financial aspects which are key to success. While the issue was more targeted to dealing with residents unhappy about change (new services and being charge for them), there were underlying parts of this challenge encouraging me to update my blog.
First, we must do a better job of helping our leadership and management teams understand the financial aspects of our business. While some companies and regional managers do a good job, I believe we have overall failed to capitalize on key information which can make them more effective in reaching goals and objectives. Ask a room full of property managers what NOI means, how it is associated with a properties value, and how do you use it in calculations, and I guarantee you there will be some seasoned managers that struggle with the answer. Remember that increasing revenue or income is only part of measuring our success, and other factors must be considered when looking at NOI and the bottom line. As an example, in the situation discussed on the site a property was in a market that was doing well and able to increase rents with great occupancy. Occupancy was around 95%, and they were raising rents anywhere from $40 to $100. They were facing an additional increase of $18 per apartment while introducing a trash at the door pickup service. As a result, a group of around forty residents had presented a petition related to the increase and new service. Naturally, they were not "happy campers" and wanted to voice their opinion.
So, where does this take us? It takes us to the financial equations and what is called the equilibrium or balance point between income, occupancy, expenses, and what is tolerable based on perceived services from a resident standpoint. Naturally market conditions will also play a factor and need to be analyzed and monitored. Basically, where is the cost benefit of an action that has a potential to increase revenue and is not an expense burden? If my property decides to raise rent by $80 at renewal and the average turnover for the community has been 60%, where is it cost effective for me to drive higher rents versus the offset expenses related to turnover? Remember that raising rents by $80 per month will generate $960 in new revenue based on a twelve month lease. To justify or find the benefit to this approach I have to look at what my costs would be if the resident did not renew including painting, cleaning, carpet cleaning, maintenance services, marketing, vacancy loss, etc. Then there is the incidental costs which can include carpet replacement, appliance upgrades, etc., which might have to be considered. An example of this would be a resident that has lived in an apartment for four years and if they moved out possibly would require carpet replacement to adequately market the unit. If they renewed however, we might get another year or two out of the carpet. If turnover increases from the baseline and my cost to turn an apartment including hard and soft costs is $2,000 (current national average is over $3,000), now I am trying to justify an increase in revenue of $960 for a cost of $2,000.
Balancing this is not taught, and if it is not taught it is not used as beneficial information. Another key factor is the use today of lease rent optimizers. Some programs are revenue driven, some are occupancy driven. Not sure if any of them factor in turnover expenses, however, that will be a question I ask in an email I will get out tomorrow. If not, this is a situation that may have exposure to the bottom line. It may increase revenue or occupancy, but have a reverse impact on Net Operating Income and Cash Flow. Educating our teams at the sites on the impact and effect on the bottom line is easily taught. It's like Newton's Law, "for every action there is an equal or opposite reaction." The decisions we make have consequences, and in some cases we believe they are progress when in fact they can have the opposite effect. Condition your teams, so they understand this theory and they will have reach new goals for the future.
First, we must do a better job of helping our leadership and management teams understand the financial aspects of our business. While some companies and regional managers do a good job, I believe we have overall failed to capitalize on key information which can make them more effective in reaching goals and objectives. Ask a room full of property managers what NOI means, how it is associated with a properties value, and how do you use it in calculations, and I guarantee you there will be some seasoned managers that struggle with the answer. Remember that increasing revenue or income is only part of measuring our success, and other factors must be considered when looking at NOI and the bottom line. As an example, in the situation discussed on the site a property was in a market that was doing well and able to increase rents with great occupancy. Occupancy was around 95%, and they were raising rents anywhere from $40 to $100. They were facing an additional increase of $18 per apartment while introducing a trash at the door pickup service. As a result, a group of around forty residents had presented a petition related to the increase and new service. Naturally, they were not "happy campers" and wanted to voice their opinion.
So, where does this take us? It takes us to the financial equations and what is called the equilibrium or balance point between income, occupancy, expenses, and what is tolerable based on perceived services from a resident standpoint. Naturally market conditions will also play a factor and need to be analyzed and monitored. Basically, where is the cost benefit of an action that has a potential to increase revenue and is not an expense burden? If my property decides to raise rent by $80 at renewal and the average turnover for the community has been 60%, where is it cost effective for me to drive higher rents versus the offset expenses related to turnover? Remember that raising rents by $80 per month will generate $960 in new revenue based on a twelve month lease. To justify or find the benefit to this approach I have to look at what my costs would be if the resident did not renew including painting, cleaning, carpet cleaning, maintenance services, marketing, vacancy loss, etc. Then there is the incidental costs which can include carpet replacement, appliance upgrades, etc., which might have to be considered. An example of this would be a resident that has lived in an apartment for four years and if they moved out possibly would require carpet replacement to adequately market the unit. If they renewed however, we might get another year or two out of the carpet. If turnover increases from the baseline and my cost to turn an apartment including hard and soft costs is $2,000 (current national average is over $3,000), now I am trying to justify an increase in revenue of $960 for a cost of $2,000.
Balancing this is not taught, and if it is not taught it is not used as beneficial information. Another key factor is the use today of lease rent optimizers. Some programs are revenue driven, some are occupancy driven. Not sure if any of them factor in turnover expenses, however, that will be a question I ask in an email I will get out tomorrow. If not, this is a situation that may have exposure to the bottom line. It may increase revenue or occupancy, but have a reverse impact on Net Operating Income and Cash Flow. Educating our teams at the sites on the impact and effect on the bottom line is easily taught. It's like Newton's Law, "for every action there is an equal or opposite reaction." The decisions we make have consequences, and in some cases we believe they are progress when in fact they can have the opposite effect. Condition your teams, so they understand this theory and they will have reach new goals for the future.
Saturday, September 24, 2011
Rewards
As many of you know, in addition to being a Divemaster and swimming with sharks, being a professional magician, and a property management executive, I provide keynote speaking and workshops. All of these things I do I have a passion for, and bring me extreme satisfaction. The rewards for finding and doing something you love cannot be measured in dollars, and not very often can a person say they have so many things they do well and enjoy so much.
This past week I was in Tampa teaching a workshop related to leadership, team building, as well as other topics. Today I put on a rubber suit and swam with nine foot sharks, did a little magic for some guests, and then came home thinking how lucky I am. Yes, finding a leadership role again in the corporate world is what has been my primary income, but for now I am using the cards I have been dealt with. After all what job that is legal other than the one I have can you go to work in a full rubber suit...and not worry you might get arrested for it.
Traveling around the country providing training and education has definitely helped pay the bills, and has rewards in so many other ways. You have heard me write how each time I speak before a group and share information with the intent of others exceeding and excelling, I always find value and "take-away's" which are additional rewards encouraging me always striving to do better. Whether it be a new way to add humor to a presentation or even a whole new way of presenting a topic, the benefits from interacting with my audience raise the question, "who is benefiting from what I am doing?" My intention is that both parties are the benefactor, otherwise we cannot evolve with the goal of excellence and therefore maintain our edge for the future.
The rewards of life cannot and should not be with only a financial purpose, but with a purpose of living and inner peace. For I believe to be successful in business, you first have to be successful within yourself. To be an effective and successful leader and coach, it takes inner success and self-development to keep up with an ever changing world. It takes the unselfish act of wanting to share information with others, versus keeping it for your benefit only to be used for individual gain. For the rewards of watching others maximize their potential and benefit from the small part I have played, give me the drive to do what I do and reach for new heights in my career. For you see leadership is not about getting people to just follow you, but to do it with a purpose and a light that shines on their path to success as well.
Where are your rewards? What do you see as your purpose? And one of the most important questions is, "how will you get there and who will you take with you so the journey is not alone?"
This past week I was in Tampa teaching a workshop related to leadership, team building, as well as other topics. Today I put on a rubber suit and swam with nine foot sharks, did a little magic for some guests, and then came home thinking how lucky I am. Yes, finding a leadership role again in the corporate world is what has been my primary income, but for now I am using the cards I have been dealt with. After all what job that is legal other than the one I have can you go to work in a full rubber suit...and not worry you might get arrested for it.
Traveling around the country providing training and education has definitely helped pay the bills, and has rewards in so many other ways. You have heard me write how each time I speak before a group and share information with the intent of others exceeding and excelling, I always find value and "take-away's" which are additional rewards encouraging me always striving to do better. Whether it be a new way to add humor to a presentation or even a whole new way of presenting a topic, the benefits from interacting with my audience raise the question, "who is benefiting from what I am doing?" My intention is that both parties are the benefactor, otherwise we cannot evolve with the goal of excellence and therefore maintain our edge for the future.
The rewards of life cannot and should not be with only a financial purpose, but with a purpose of living and inner peace. For I believe to be successful in business, you first have to be successful within yourself. To be an effective and successful leader and coach, it takes inner success and self-development to keep up with an ever changing world. It takes the unselfish act of wanting to share information with others, versus keeping it for your benefit only to be used for individual gain. For the rewards of watching others maximize their potential and benefit from the small part I have played, give me the drive to do what I do and reach for new heights in my career. For you see leadership is not about getting people to just follow you, but to do it with a purpose and a light that shines on their path to success as well.
Where are your rewards? What do you see as your purpose? And one of the most important questions is, "how will you get there and who will you take with you so the journey is not alone?"
Tuesday, September 13, 2011
Service with a smile!
Service is something we provide, and something our residents and prospects expect. It means going above and beyond and not meeting their expectations, but exceeding them. Keeping your team motivated so they continue to give great service has and always will be a challenge. I have said it time and time again, I believe if we treat our employees as number one...they will in turn treat our residents and prospects as number one. So how do we keep them at the top of their game and "in" the game so they score a touchdown every time they come in contact with someone? I am confident there are some tried and true ways we can facilitate great service, while keeping our team motivated.
1. Communication - Open, honest, and straight forward! Communication is the key to success and one of the keys in maintaining a motivational environment. This includes constant and honest feedback, making sure the team not only knows the goals but the reason behind them, and understanding what mediums to communicate specific messages and how you communicate may depend on who it is you are communication with. Share the good, the bad, and sometimes the ugly (or also called the challenging).
2. Keeping their eye on the target and goal - While we as supervisors and leaders need to focus on goals an objectives, we must never forget we should also insure our teams can see the target as well. Sharing budgets, goals related to leasing and resident retention help your team understand expectations and hit the target. Remember it is impossible for a team or someone to hit a target if they can't hit it. It is also important that the target be understood as achievable. As an example if the goal is to lease thirty apartments in a month, team members may see this as a high number. However, if we say to them this only means one lease every other day with two leasing specialists in the office it now sounds like an achievable number. One technique I like using is a goal board where not just the current goal is visible, but the progress of reaching that goal is visible as well. If the goal is thirty leases, I number from one to thirty on the board. The first person to get a lease in that goal period signs their name through that number showing twenty-nine left to go. It not only helps them track the progress, it also instills a competitive spirit among the team.
3. Finding variety in what they are doing - Keeping team members motivated is difficult, especially during soft market conditions and challenging times. Finding creative ways to inspire your team are critical to success and keeping good people at your sites. Contests can be good, however, sometimes it can be the prize attained and the competitiveness that are more important. I also like seeing competition between properties in a region where the entire teams are rewarded if the goals are met, taking into consideration maybe more than one site is a winner if multiple locations meet their goals. I remember one time telling a site team I would dress up in a banana costume and be a human directional on the main street for an entire day if a goal was met for occupancy and collections. I set the goal high (who wants to dress up in a banana costume in Florida on a hot summer day), and to my surprise it encouraged the team to dig down and not only meet the goal but to exceed it. By the way, the sign I had to display in the costume was, "We have apartments with appeal!"
4. Share the successes and feedback - Too often we are quick to tell teams and team members when goals are not met or when results not attained. On the other hand, we don't always share success and positive feedback. Positive feedback can come from our observations, financial reports, goals met, communication from vendors and residents, and even a ratings site (which I will not mention). If I am visiting on a site visit and see a leasing specialist doing a great job with a prospect or resident, I will go out of my way to let them know my observations. If I review service request follow up and see consistent high marks or favorable remarks, I will do the same with the service staff. Acknowledgement of success is in my opinion equally if not more important than quickly responding to unfavorable performance.
5. Asking for their input and ideas - The real definition of a team means soliciting ideas, input, and suggestions from team members...ALL team members. Getting everyone involved is important and lets all members know their importance as a team unit. I have also received some exceptional marketing and leasing suggestions from service, and great ideas can some from those you don't expect. Remember, a leader is not a title...it is a person. I have had some great leaders as grounds people and porters, just as I have as managers.
6. Lead by example...get involved yourself - I am not afraid to do anything I expect other team members to do. I recently had a service manager I worked with call me and tell me his respect for me was amplified by the fact I would jump in and do things no other regional he had worked with with do. When we experienced a hurricane and flood in central Florida, I was there in waders helping out. If I was in the office I would answer the phone and lease an apartment just as quickly as anyone. As Bryan said, "I admired you because you were there next to us in support, beside us to encourage and understand, and in front of us to lead the way and show us the path to success." That my friends, is why I do what I do. Thanks Bryan, your call that day made my day and my respect for you will always be true as I see you as a leader as well.
Until next time. Keep leading, keep leasing, and keep the faith.
1. Communication - Open, honest, and straight forward! Communication is the key to success and one of the keys in maintaining a motivational environment. This includes constant and honest feedback, making sure the team not only knows the goals but the reason behind them, and understanding what mediums to communicate specific messages and how you communicate may depend on who it is you are communication with. Share the good, the bad, and sometimes the ugly (or also called the challenging).
2. Keeping their eye on the target and goal - While we as supervisors and leaders need to focus on goals an objectives, we must never forget we should also insure our teams can see the target as well. Sharing budgets, goals related to leasing and resident retention help your team understand expectations and hit the target. Remember it is impossible for a team or someone to hit a target if they can't hit it. It is also important that the target be understood as achievable. As an example if the goal is to lease thirty apartments in a month, team members may see this as a high number. However, if we say to them this only means one lease every other day with two leasing specialists in the office it now sounds like an achievable number. One technique I like using is a goal board where not just the current goal is visible, but the progress of reaching that goal is visible as well. If the goal is thirty leases, I number from one to thirty on the board. The first person to get a lease in that goal period signs their name through that number showing twenty-nine left to go. It not only helps them track the progress, it also instills a competitive spirit among the team.
3. Finding variety in what they are doing - Keeping team members motivated is difficult, especially during soft market conditions and challenging times. Finding creative ways to inspire your team are critical to success and keeping good people at your sites. Contests can be good, however, sometimes it can be the prize attained and the competitiveness that are more important. I also like seeing competition between properties in a region where the entire teams are rewarded if the goals are met, taking into consideration maybe more than one site is a winner if multiple locations meet their goals. I remember one time telling a site team I would dress up in a banana costume and be a human directional on the main street for an entire day if a goal was met for occupancy and collections. I set the goal high (who wants to dress up in a banana costume in Florida on a hot summer day), and to my surprise it encouraged the team to dig down and not only meet the goal but to exceed it. By the way, the sign I had to display in the costume was, "We have apartments with appeal!"
4. Share the successes and feedback - Too often we are quick to tell teams and team members when goals are not met or when results not attained. On the other hand, we don't always share success and positive feedback. Positive feedback can come from our observations, financial reports, goals met, communication from vendors and residents, and even a ratings site (which I will not mention). If I am visiting on a site visit and see a leasing specialist doing a great job with a prospect or resident, I will go out of my way to let them know my observations. If I review service request follow up and see consistent high marks or favorable remarks, I will do the same with the service staff. Acknowledgement of success is in my opinion equally if not more important than quickly responding to unfavorable performance.
5. Asking for their input and ideas - The real definition of a team means soliciting ideas, input, and suggestions from team members...ALL team members. Getting everyone involved is important and lets all members know their importance as a team unit. I have also received some exceptional marketing and leasing suggestions from service, and great ideas can some from those you don't expect. Remember, a leader is not a title...it is a person. I have had some great leaders as grounds people and porters, just as I have as managers.
6. Lead by example...get involved yourself - I am not afraid to do anything I expect other team members to do. I recently had a service manager I worked with call me and tell me his respect for me was amplified by the fact I would jump in and do things no other regional he had worked with with do. When we experienced a hurricane and flood in central Florida, I was there in waders helping out. If I was in the office I would answer the phone and lease an apartment just as quickly as anyone. As Bryan said, "I admired you because you were there next to us in support, beside us to encourage and understand, and in front of us to lead the way and show us the path to success." That my friends, is why I do what I do. Thanks Bryan, your call that day made my day and my respect for you will always be true as I see you as a leader as well.
Until next time. Keep leading, keep leasing, and keep the faith.
Wednesday, September 7, 2011
The Four F's
Most of my writing has been related to encouraging others to exceed and excel through practices and principles. I have shared information about marketing, leadership, communication, team building, training, and a host of topics. I have a passion for sharing information and for wanting to be the best we can be. I get excited when someone contacts me about a posting and it energizes them to another level. That my friends, is what it is all about. Now I want to discuss what I call the Four F's of Success. I believe there are four key areas which in conjunction with other principles (leadership, communication, knowledge, determination, etc.), are keys to success not just professionally but also personally. It is about who we are...and not what we are!
The first "F" is Family. I have been blessed with a loving and caring family and I am so grateful. Now family can be blood relation, married relation, or can be those that are close to you who are treated as family. Family members are those that believe in you, and you believe in! Family members are people you trust and confide in, and someone you can open up to. I believe to be successful you need people like this who are there beside you to believe in you, behind you to encourage and push you, and in front of you if necessary to help filter the path and shed new light on your travels. Sometimes they are the bearer of truth, even when we cannot see it. It is difficult for us to be objective and see who we really are, and maybe don't want to see who we are. Family can bring a bond that is supportive, enlightening, and a love that digs into our core and sole like nothing else.
The second "F" is Faith. While I am a religious person and believe in a higher being, faith can play a part in different ways. It can mean your faith from a religious standpoint, just as it can mean the faith you have in yourself and others. Believing in yourself is critical to success, especially picking yourself up after something in your life has broken you down. Believing and having faith in my abilities is important to what I am, but more importantly as to who I am. A leader must have faith in others, for without empowerment there is not encouragement. We build faith through our knowledge and experiences, often learning along the way how to build the foundation of success. Personal faith and religious faith can be intertwined, and often is with most successful people in business. I almost added people in government to that sentence, only to think about things like "thou shall not lie, thou shall not steal, thou shall not commit adultery, etc," which rules out most of our government officials. Believing in God, believing in oneself, and believing in others is all part of having the faith necessary to be successful not only in what we do...but how we do it.
The next "F" is Friendship, which also ties into respect. Friends can be at different levels and mean different things to different people. You can have close friends, distant friends, friends that are acquaintances, and friends that are like family. Sometimes your family can also be your friend, as an example with my wife who is also my best friend. True friends like family are not afraid to tell you like it is, and be there for you in both good times and challenging times. A true friend will take your call at two in the morning, and also be one who is not afraid to call you at that same time should they need comfort and advice. A true friend will not sugar coat something for your benefit, and is someone you may not always agree with but respect. You can have friends at work or those that work with you, however, I would much rather have "respect" than friendship from those who are business associates. It does not mean they are not still friends in some ways, but it has a different processing and status related to friendship where respect is the focal point and intended result.
The last "F" is Fun. I know too many business executives that live, breath, and eat their jobs...and it shows. They are so tied up with power and success, they forget how to live life and how important others are to their success and happiness. Most of the time I find that these individuals are missing in the three previous F's (Family, Faith, and Friendship), and therefore cannot maximize this element. I remember my Dad telling me, "If you do not enjoy what you are doing, do something else. For your lack of enjoyment will transfer to those working with you and for you, and it will burden your ability to be as successful as you can be." I hear the wise words of my father resonating in my head often, and unfortunately find it too late to thank him for what at one time I did not understand...and now cherish. Fun is taking life to the maximum! It is finding things you are passionate about and enjoy and doing them. It is sharing your passions with others, and about getting inner satisfaction. As an example, "I am a property manager and leader." While this is something I do professionally, it is also something I enjoy and have a passion for. Even though doing what I do takes long hours, sometimes extended travel from my family, facing significant and new challenges, and sometimes when you do your job you are the least liked, it is rewarding in some of those same ways. For the diversity of my profession means I never have two days exactly the same, I am constantly learning from the experiences I am faced with, I am stronger from the challenges I face, and the reward from knowing I am fair and consistent in my dealings (my ethics) no matter what others will think because I am at peace with myself gives me joy. It also means having a life outside of work, finding out what brings you happiness. Everyone that knows me understands my passion for diving and magic. Being a professional magician and having the ability to provide wonder and amazement is fun and exciting. Being a diver allows me time to hear nothing but my bubbles for hours at a time. No cell phone, no pager, no computer, no telephone, just my bubbles and nature to bring me to a peaceful state.
Being the best and always striving to exceed and excel takes many qualities and traits. It takes knowledge, drive, determination, ethics, abilities, passion, and a strong inner core to be successful in business as with in life. It is these four "F's" I believe are the building blocks to that strong inner core, which can be the foundation to your success...no matter what you do.
The first "F" is Family. I have been blessed with a loving and caring family and I am so grateful. Now family can be blood relation, married relation, or can be those that are close to you who are treated as family. Family members are those that believe in you, and you believe in! Family members are people you trust and confide in, and someone you can open up to. I believe to be successful you need people like this who are there beside you to believe in you, behind you to encourage and push you, and in front of you if necessary to help filter the path and shed new light on your travels. Sometimes they are the bearer of truth, even when we cannot see it. It is difficult for us to be objective and see who we really are, and maybe don't want to see who we are. Family can bring a bond that is supportive, enlightening, and a love that digs into our core and sole like nothing else.
The second "F" is Faith. While I am a religious person and believe in a higher being, faith can play a part in different ways. It can mean your faith from a religious standpoint, just as it can mean the faith you have in yourself and others. Believing in yourself is critical to success, especially picking yourself up after something in your life has broken you down. Believing and having faith in my abilities is important to what I am, but more importantly as to who I am. A leader must have faith in others, for without empowerment there is not encouragement. We build faith through our knowledge and experiences, often learning along the way how to build the foundation of success. Personal faith and religious faith can be intertwined, and often is with most successful people in business. I almost added people in government to that sentence, only to think about things like "thou shall not lie, thou shall not steal, thou shall not commit adultery, etc," which rules out most of our government officials. Believing in God, believing in oneself, and believing in others is all part of having the faith necessary to be successful not only in what we do...but how we do it.
The next "F" is Friendship, which also ties into respect. Friends can be at different levels and mean different things to different people. You can have close friends, distant friends, friends that are acquaintances, and friends that are like family. Sometimes your family can also be your friend, as an example with my wife who is also my best friend. True friends like family are not afraid to tell you like it is, and be there for you in both good times and challenging times. A true friend will take your call at two in the morning, and also be one who is not afraid to call you at that same time should they need comfort and advice. A true friend will not sugar coat something for your benefit, and is someone you may not always agree with but respect. You can have friends at work or those that work with you, however, I would much rather have "respect" than friendship from those who are business associates. It does not mean they are not still friends in some ways, but it has a different processing and status related to friendship where respect is the focal point and intended result.
The last "F" is Fun. I know too many business executives that live, breath, and eat their jobs...and it shows. They are so tied up with power and success, they forget how to live life and how important others are to their success and happiness. Most of the time I find that these individuals are missing in the three previous F's (Family, Faith, and Friendship), and therefore cannot maximize this element. I remember my Dad telling me, "If you do not enjoy what you are doing, do something else. For your lack of enjoyment will transfer to those working with you and for you, and it will burden your ability to be as successful as you can be." I hear the wise words of my father resonating in my head often, and unfortunately find it too late to thank him for what at one time I did not understand...and now cherish. Fun is taking life to the maximum! It is finding things you are passionate about and enjoy and doing them. It is sharing your passions with others, and about getting inner satisfaction. As an example, "I am a property manager and leader." While this is something I do professionally, it is also something I enjoy and have a passion for. Even though doing what I do takes long hours, sometimes extended travel from my family, facing significant and new challenges, and sometimes when you do your job you are the least liked, it is rewarding in some of those same ways. For the diversity of my profession means I never have two days exactly the same, I am constantly learning from the experiences I am faced with, I am stronger from the challenges I face, and the reward from knowing I am fair and consistent in my dealings (my ethics) no matter what others will think because I am at peace with myself gives me joy. It also means having a life outside of work, finding out what brings you happiness. Everyone that knows me understands my passion for diving and magic. Being a professional magician and having the ability to provide wonder and amazement is fun and exciting. Being a diver allows me time to hear nothing but my bubbles for hours at a time. No cell phone, no pager, no computer, no telephone, just my bubbles and nature to bring me to a peaceful state.
Being the best and always striving to exceed and excel takes many qualities and traits. It takes knowledge, drive, determination, ethics, abilities, passion, and a strong inner core to be successful in business as with in life. It is these four "F's" I believe are the building blocks to that strong inner core, which can be the foundation to your success...no matter what you do.
Thursday, September 1, 2011
Hire Today...Gone Tomorrow
I have written on hiring before, however, I was recently asked by a manager for more details about making the right choice. None of us has a crystal ball or can foretell the future of those hiring decisions we make. What we can do is everything within our power to make an educated decision that is right for our team. As I interview for what I hope will be a stable company I can be with for many years if not for the rest of my career, I reflect on what others may be looking for. I used to judge differently if I had a candidate who had been with two companies over the last six years, only to then be in a position such as with events in my career where "downsizing...or up-profiting," may have been the answer and not performance. When you are one of the highest improved and occupied regions in a company and your position is eliminated, extenuating factors may at play outside of someones control. Still, it was a hard pill to swallow and you pick yourself up and keep on trucking. It also makes the resume reviews and considerations for the best candidate more challenging.
“They are not your employees, they are your people.” Stephen Covey could not have said this better. We all can agree the business environment we work in is not for everyone. The decisions we make about potential employees are considered by many as the most important decision you can make. Property Managers make decisions every day about marketing, property and product positioning, suppliers, scheduling, risk management, maintenance, and a whole host of other critical areas. However, the most important key to our success as leaders and managers is the people we place in the positions that support our decisions. Since we do not operate, manage, or lead in a vacuum or by ourselves, hiring the right people could not be more important…of course followed by keeping and motivating the right people.
Any manager can say they have made good hiring decisions, and likewise can also say they have made bad ones. I know most of us can say they have hired Dr. Jekyll, only to find Mr. Hyde after a period of time. The key to success in hiring the right people is like solving a difficult puzzle. It is finding the right piece to complete the picture for success. The question I hear asked time and time again is, “How do I minimize my risk and improve the chances of hiring the right person?” The answers can be found in viewing the hiring process in several steps, all of them important.
Know the difference between what you need and what you want!
This first step is often not taken seriously. You say you need a leasing consultant. You probably say you first need someone that can lease! That is important, however; you also need someone that fits into the team. You need to understand and look back at what characteristics make up the best person for the job, the community, and your team. Leasing and selling apartments is only a portion of this position if we think about it. We also need someone who is outgoing, not afraid to and knows how to handle an unhappy resident or prospect, someone that has the right attitude to learn, is organized and can manage their time, can communicate well both verbally and in writing, and so on. This step is often cut short because we “think” we know what we are looking for on the surface, or we are rushed to fill a position and do not take the time to fill it with the “right” person. This works for any position in multi-family management.
Have more than one person conduct the interview!
It should always take more than two people to hire and make hiring decisions. Studies show the more people involved in the interview process, the greater the chance of finding the right person. Including others in the process does several things. First, it provides a different perspective of the candidates other than our own. With a variety of interviewing styles and questions, we have a greater opportunity to see a candidate for who they may truly be. Second, including other team members in the process adds to creating a motivational environment. Everyone wants to feel they are a part of operations, and involving others can be extremely beneficial and rewarding. Remember, the interview process is to confirm the person being considered is competent and compatible, and is a good fit with the rest of the team.
Ask the right questions…get the right answers!
Have a series of questions you ask every candidate. This provides for a comparison of answers and provides an equal playing field when interviewing. Never ask questions that can simply be answered by a yes or a no. For example, when asking about their ability to be a team player I might ask, “Please share with me specifics as to why you believe you are a team player and provide examples which will help me understand your belief.” Never ask about their strengths without follow-up validation. Having been an interviewer as well as an interviewee, I know this type of question often comes up. I don’t want to know just what someone views as his or her strengths, but confirmation that it is a positive attribute. Anyone can say they have strengths; I want them to prove it. Never be afraid to ask follow-up questions. “You say you are an excellent service person. What in your mind are the specific qualities that determine excellent service?” Now, I may get the answers I am looking for.
Never be afraid to test the applicant!
I’m not talking about psychological profile tests. If you’ve taken enough of them you probably know how to answer them without revealing your true self. What I am suggesting is testing their ability to do the job. Two key points are critical to performance testing. One, you have to be knowledgeable in the area being questioned. Second, if you are not knowledgeable you need to involve someone who is. Let’s look at two examples. You are hiring for a service position. Anyone can say they are good at heating and air conditioning. To consider myself as an effective leader in managing our valued service team members, I took the class for HVAC refrigerant certification and Certified Pool Operator. Don’t ask me to change out your compressor; you might not be as warm in the winter as you would hope to be. I do, however; know important information related to HVAC operation that helps me understand what our service personnel must do, which allows me to ask questions in an interview other regional’s may not be able to. I will often tell a service candidate I need them to troubleshoot a problem. The situation is the interior blower unit is working, however; the outside condenser is not. What are you going to check first? If the candidate says they will check the refrigerant levels, I know they are not my next employee; as you always check the electrical components first. If I am not confident in my knowledge of maintenance systems, I am going to find someone who is to conduct an interview and ask the verification questions. I have even had service managers take the candidate out on the site on service calls to see if they really know their “stuff.” If I am hiring a leasing person and they say they can lease ice water to Eskimos, how do I know they can perform as stated? I provide them with all of our prospect information, let them review it, and then take them to the model or an apartment. I always leave them alone in the apartment home, and tell them to return to the office and provide me their thoughts. What I don’t tell them is when they return I am going to say, “Now show me that apartment as if you were going to lease it to me, starting with me walking in the front door.”
Ask the hard questions and don’t just emphasize the good!
Anyone can ask “fluff” questions, and you will probably get “fluff” answers. We do not work 9-5 jobs, and we do not always have the happiest campers to deal with. The character of an employee shows not only when things are going well, but also how they handle themselves when they are challenged. For a service candidate I may ask, “Accepting this position means you will have to be on call after normal office hours. You may get a call at 2:00 AM from a very upset and angry resident. In addition to being a qualified service person, you also have to act as the property’s representative and ambassador in times of need. Are you prepared for this and what do you believe is important in handling this type of delicate situation?” We tell candidates about our benefits, how good the company is, how the team is, etc., but we fail to remind them everyone will be challenged at some point in time. It is how these times are handled that impact not only the perception of an employee, but the entire team. These types of questions also set the stage for what our expectations really are.
Don’t trust the resume or forget to check references!
Now, I realize many companies are hesitant about providing reference information other than if the candidate worked for them and their hire date. This is where being Sherlock Apartment Homes is important. Unless you have a company that will do this service for you, it is up to you to verify and confirm what they tell you. When checking their credit file, it often has address information listed. If they say they have been working in Denver and you see they have had credit with an address from San Francisco for the past nine months, you might want to ask some questions. A recent study showed 68% of candidates exaggerated accomplishments, and 45% were not honest about their position responsibilities. You must at least make the attempt to contact former employers, ask the questions, and do everything you can to provide verification. I asked a manager once about the hire she had made and if she had checked references. She said she had called the candidate’s last two employers at least three times each, faxed the authorization for information, and could not even get a return phone call. Can you say “Red Flag?” Within a few weeks it was very apparent we had made a poor hiring decision, and there was more to the story. I had a candidate for a position, and after calling Human Resources at her previous company, I asked if I could verify some information. The Human Resource representative said, “I’m sorry I am not allowed to talk about her departure from our company.” She did not say they were not allowed to give out previous employee information; she was very clear about anything dealing with this previous employee. Nothing ventured…nothing gained, so take make the effort.
Don’t just fill the position, fit the position!
One of the biggest mistakes made today is not taking time to insure you are finding and selecting the best candidate for the position. We look at being short-staffed and for some reason have blinders on, focused on filling the position immediately. Other team members may have to compensate for the missing employee, or we as managers may have to work harder. This is where working smarter will have a lasting benefit and make up for overcoming the challenges of a short-staffed team. The fact is if we fail to find the right person, we very well may be going through this process again in a short time. We should realize the average cost of an employee replacement is estimated to be well over $4,000, which includes finding and training a new team member. This is not to mention what impact it can have on the cohesiveness of the existing team members by hiring the wrong person. Take your time, which will save time later by making sure you fit the position with the best candidate.
Hire the wrong person for the wrong job and it will have an impact on operations, your team, and even resident retention. The financial costs in making the wrong decision can be in the thousands, including time and resources. This does not include what impact the wrong decision can have on disrupting and in some cases, dismantling an entire team by bringing in the wrong player. Hiring is both a management decision and a leadership decision. We need to manage the process, while placing leadership principles into the equation. Anyone in management can make decisions. Making good decisions in a timely manner shows you can be an effective leader. Don’t forget, it’s about hiring the right person, for the right job, and for the right reasons.
Thursday, August 25, 2011
Sharing
I started this blog to share information, which is a passion of mine like property management. I appreciate all the hundreds of comments and emails I have received from friends in the industry. Many from those I have worked with, and many new friends I have met through Multifamily Insiders, Linkedin, and other sites. Being the best I can be and seeing others be their best is what it is all about. Sharing information, stories, and new methods of addressing how we do our jobs is extremely exciting and rewarding. I have posted about leadership, budgeting, fair housing, marketing, and other topics, always with the intent of having others find "take-away's" from what was included. I recently received an email from someone who reads my blog, and would like to share a couple of comments. Yes, I found them gratifying as well as inspiring to continue what I do. Here is what she said:
"I read your blog today, and could not stop at just one topic. Your comments appear to be heartfelt and inspirational, and for the first time in a manner I could really relate to. So many times we attend educational events or seminars that are directed at inspiring us, only to return to work the next day not being able to relate to what was said and therefore not retained. I found your blog after one of your students at a CAM class recommended you. She told me how you delivered a topic most managers don't think of as important, and made it interesting and memorable. From your blog page and writing, I can see why she said that and recommended you. She also said she learned more from your class in one day that what had been given by her company in four years as a manager. Please keep writing and I will keep reading as well as sharing your site with others. I appreciate what you are doing and taking your valuable time to share with others out here in the real world. If only my regional and others in the organization would take the same perspective and desire to share as you did, we would all be better at what we do." Reading a posting in Multifamily Insiders and another one in Apartment Professionals Network from Apartment Home Living in Linkedin, comments drifted into making employees feel important and therefore they will make their residents feel important. We discussed attitude, training, and a host of topics focused on how we can get our team members to pass on that importance to our residents. I feel one of the highlights and key points was when "attitude" was brought up. We can train for many areas such as closing, fair housing, etc., but it is impossible to train for attitude. That comes from the environment they work in and the leaders that lead them, building an attitude and desire for success.
Keep sharing, keep learning, and keep inspiring others to exceed and excel. That my friends will bring you success beyond your wildest dreams, and the rewards will touch your heart in addition to your ability to be successful. Share the wealth!
"I read your blog today, and could not stop at just one topic. Your comments appear to be heartfelt and inspirational, and for the first time in a manner I could really relate to. So many times we attend educational events or seminars that are directed at inspiring us, only to return to work the next day not being able to relate to what was said and therefore not retained. I found your blog after one of your students at a CAM class recommended you. She told me how you delivered a topic most managers don't think of as important, and made it interesting and memorable. From your blog page and writing, I can see why she said that and recommended you. She also said she learned more from your class in one day that what had been given by her company in four years as a manager. Please keep writing and I will keep reading as well as sharing your site with others. I appreciate what you are doing and taking your valuable time to share with others out here in the real world. If only my regional and others in the organization would take the same perspective and desire to share as you did, we would all be better at what we do." Reading a posting in Multifamily Insiders and another one in Apartment Professionals Network from Apartment Home Living in Linkedin, comments drifted into making employees feel important and therefore they will make their residents feel important. We discussed attitude, training, and a host of topics focused on how we can get our team members to pass on that importance to our residents. I feel one of the highlights and key points was when "attitude" was brought up. We can train for many areas such as closing, fair housing, etc., but it is impossible to train for attitude. That comes from the environment they work in and the leaders that lead them, building an attitude and desire for success.
Keep sharing, keep learning, and keep inspiring others to exceed and excel. That my friends will bring you success beyond your wildest dreams, and the rewards will touch your heart in addition to your ability to be successful. Share the wealth!
Saturday, August 20, 2011
Market Analysis
As property managers, one of our responsibilities is marketing. How do we get out message out to potential prospects, what do we say to entice them to call or visit us, and what mediums do we use? These are all points we have to consider, however, one critical point is often overlooked...understanding who we are marketing to.
Before you can decide on a medium, enticement line, or any other consideration we have to understand who our residents are and who our prospects are. Analysis of our target market is more than just price point, and for any community we have to consider a host of variables. These include:
1. Yes price is a factor, therefore who can afford our apartments? If our guideline is normally three times rent to income, what does that equate to? As an example for an $800 per month rent that comes to a base income of $28,800 or someone that makes approximately $14.00 per hour (if you look at a 40 hour work week that equates to 2,080 hours per year). If your guideline is higher or rents are higher, you can do the math to find out who you should target based on price. The first question is what jobs pay that would meet your minimum income standards?
2. Where do people work and what is the average travel time in your market? Are there geographic or topographic considerations such as rivers, mountains, or even toll roads that people look at in getting to primary work areas? While you have three different market areas within any major market (primary, secondary, and tertiary), how do trends within the market related to these considerations as well as public transportation play a part? A downtown mid-rise compared to a rural three story walk-up community will look at marketing very different just based on what I call "behavioral" patterns of living.
3. Is there an primary age range that seems to fit your community better or a range that has already been identified as through years of establishment? Do you cater to an older clientele based on the location or seasonal nature of the market (here in Florida we have many senior communities)? Is your community designed and built with more "new age" design and amenities where you might target a younger and more professional resident?
4. What amenities, resident activities, appointments or other considerations that identify with any market segment which can help attract prospects to your community? This also includes anything from stainless appliances to floor covering, garages, and other features as well as square footage and storage space.
Next you need to complete an analysis on what marketing mediums you have available, what your budget is, and how you can get your message to potential prospects. Is your target more "technology" savoy and you need to focus on electronic mediums more than print? Maybe your target is "seasoned citizens," who based on generational studies still want a guide they can hold in their hand. Maybe you need to have a combination of mediums to attract the highest number of qualified candidates and maintain maximum occupancy. So many choices and decisions, and a limited amount of funds in my budget. So now what do I do?
This is where analysis of the mediums comes into play. Once you have identified who you need to get your message to, how do I do it? If there are three print publications in my market, which one is the best choice? First, never assume the one you have always used is the best choice for your community. I have had managers tell me the issue with occupancy is the market, when in fact it was the "marketing" that was the problem. Remember, with all the mediums and communities...your prospects have choices! Any one of the publications will tell you why they are the best. Any one of the internet sites will show you graphs and charts as to why they are the best. I have never heard a sales rep say, "You know what, I think you will do better with the Apartment Factor rather than our publication." Ain't going to happen. You also must understand markets and conditions will change, just as what each of the medium suppliers has will change compared to the competition. We live and work in a field that is constantly evolving, therefore our marketing needs to be evaluated constantly to make sure we are spending our money wisely and productively. For example when choosing a print publication the following should be part of your analysis:
1. What is the distribution and how often is the publication updated? Are their distribution racks at locations that "hit" your target market? I once had a print representative tell me they had "x" number of print racks in the city. Problem was they were not at productive or easily viewed locations, not in markets that were within the target market, and I could only change the publication information in my ad quarterly versus monthly. She showed me how thick her book was, however, when calling other competitors and looking at our stats they were not the first rated medium.
2. What backup marketing such as internet resources come with the print, and are they productive. Yes I need to be in a print publication, but my clientele also are "techno savoy." Therefore I need a publication that is strong with hitting my target market with the publication, but also need to see them at the top of the search when I Google, "Apartments Orlando," as an example. Try it and see where your internet marketing provider comes up?
3. How "eye friendly" is the publication. Is there a place for a map? How much bullet point space do I have? Is it easy to find by sections of the city? How user friendly is it including size and ease of use?
Last point is related to the financial part. Since I have pages more in my head but limited space, I'll get into "internet" marketing in another piece. That will take up an expanded posting just with the changes that are happening with that medium. So, back to financial! So I have limited funds, where do I go. If you are confident your leasing staff is doing their job, review the stats for where your traffic is coming from. Next, review your ad and content to insure you are confident you are getting your "target message" across. If you are in two publications, which one produces more and why? Call your comps and ask them how many leases on average do they get from XYZ Publication? I like using leases versus traffic because that's what it all boils down to. If I get 50 visitors a month from a publication but only 10 were qualified, something is wrong. It's not traffic I want in the door, it's what I call "leaseable" traffic. Leases are the only thing that puts money in the bank.
Final point is not being afraid to ask your owner or upper management for funds to expand your marketing as long as everything else is in check (message, medium, leasing team, etc.). I know, they will say it's not in the budget. Neither is lower income from lower occupancy so look at it this way. I have a saying and that is, "hit them in the wallet and their hearts and minds will follow." Basically you have to "sell" what you want, not just ask for what you want. Mrs. Owner, if I could increase income by $4,000 per month (5 leases at an average of $800 per apartment) while only having an $800 a month expense offset, would you consider it? Now you have their attention. Show them your complete analysis, how you got to the numbers you did, the study you made, and the expected result based on your analysis, and they will find it hard not to approve the expense.
Until next time when we'll hit our "technology" side of marketing. Make it a great week and lease-em-up!
Before you can decide on a medium, enticement line, or any other consideration we have to understand who our residents are and who our prospects are. Analysis of our target market is more than just price point, and for any community we have to consider a host of variables. These include:
1. Yes price is a factor, therefore who can afford our apartments? If our guideline is normally three times rent to income, what does that equate to? As an example for an $800 per month rent that comes to a base income of $28,800 or someone that makes approximately $14.00 per hour (if you look at a 40 hour work week that equates to 2,080 hours per year). If your guideline is higher or rents are higher, you can do the math to find out who you should target based on price. The first question is what jobs pay that would meet your minimum income standards?
2. Where do people work and what is the average travel time in your market? Are there geographic or topographic considerations such as rivers, mountains, or even toll roads that people look at in getting to primary work areas? While you have three different market areas within any major market (primary, secondary, and tertiary), how do trends within the market related to these considerations as well as public transportation play a part? A downtown mid-rise compared to a rural three story walk-up community will look at marketing very different just based on what I call "behavioral" patterns of living.
3. Is there an primary age range that seems to fit your community better or a range that has already been identified as through years of establishment? Do you cater to an older clientele based on the location or seasonal nature of the market (here in Florida we have many senior communities)? Is your community designed and built with more "new age" design and amenities where you might target a younger and more professional resident?
4. What amenities, resident activities, appointments or other considerations that identify with any market segment which can help attract prospects to your community? This also includes anything from stainless appliances to floor covering, garages, and other features as well as square footage and storage space.
Next you need to complete an analysis on what marketing mediums you have available, what your budget is, and how you can get your message to potential prospects. Is your target more "technology" savoy and you need to focus on electronic mediums more than print? Maybe your target is "seasoned citizens," who based on generational studies still want a guide they can hold in their hand. Maybe you need to have a combination of mediums to attract the highest number of qualified candidates and maintain maximum occupancy. So many choices and decisions, and a limited amount of funds in my budget. So now what do I do?
This is where analysis of the mediums comes into play. Once you have identified who you need to get your message to, how do I do it? If there are three print publications in my market, which one is the best choice? First, never assume the one you have always used is the best choice for your community. I have had managers tell me the issue with occupancy is the market, when in fact it was the "marketing" that was the problem. Remember, with all the mediums and communities...your prospects have choices! Any one of the publications will tell you why they are the best. Any one of the internet sites will show you graphs and charts as to why they are the best. I have never heard a sales rep say, "You know what, I think you will do better with the Apartment Factor rather than our publication." Ain't going to happen. You also must understand markets and conditions will change, just as what each of the medium suppliers has will change compared to the competition. We live and work in a field that is constantly evolving, therefore our marketing needs to be evaluated constantly to make sure we are spending our money wisely and productively. For example when choosing a print publication the following should be part of your analysis:
1. What is the distribution and how often is the publication updated? Are their distribution racks at locations that "hit" your target market? I once had a print representative tell me they had "x" number of print racks in the city. Problem was they were not at productive or easily viewed locations, not in markets that were within the target market, and I could only change the publication information in my ad quarterly versus monthly. She showed me how thick her book was, however, when calling other competitors and looking at our stats they were not the first rated medium.
2. What backup marketing such as internet resources come with the print, and are they productive. Yes I need to be in a print publication, but my clientele also are "techno savoy." Therefore I need a publication that is strong with hitting my target market with the publication, but also need to see them at the top of the search when I Google, "Apartments Orlando," as an example. Try it and see where your internet marketing provider comes up?
3. How "eye friendly" is the publication. Is there a place for a map? How much bullet point space do I have? Is it easy to find by sections of the city? How user friendly is it including size and ease of use?
Last point is related to the financial part. Since I have pages more in my head but limited space, I'll get into "internet" marketing in another piece. That will take up an expanded posting just with the changes that are happening with that medium. So, back to financial! So I have limited funds, where do I go. If you are confident your leasing staff is doing their job, review the stats for where your traffic is coming from. Next, review your ad and content to insure you are confident you are getting your "target message" across. If you are in two publications, which one produces more and why? Call your comps and ask them how many leases on average do they get from XYZ Publication? I like using leases versus traffic because that's what it all boils down to. If I get 50 visitors a month from a publication but only 10 were qualified, something is wrong. It's not traffic I want in the door, it's what I call "leaseable" traffic. Leases are the only thing that puts money in the bank.
Final point is not being afraid to ask your owner or upper management for funds to expand your marketing as long as everything else is in check (message, medium, leasing team, etc.). I know, they will say it's not in the budget. Neither is lower income from lower occupancy so look at it this way. I have a saying and that is, "hit them in the wallet and their hearts and minds will follow." Basically you have to "sell" what you want, not just ask for what you want. Mrs. Owner, if I could increase income by $4,000 per month (5 leases at an average of $800 per apartment) while only having an $800 a month expense offset, would you consider it? Now you have their attention. Show them your complete analysis, how you got to the numbers you did, the study you made, and the expected result based on your analysis, and they will find it hard not to approve the expense.
Until next time when we'll hit our "technology" side of marketing. Make it a great week and lease-em-up!
Friday, August 12, 2011
Checks and Balances
Now most people would think this talks about accounting or your checkbook. Others might think it has to do with keeping a balance on life or what you do professionally. As property managers we work with finances and deal with many areas. Sometimes we focus on the balance sheet or financial report and are slow to make changes, not really understanding or analyzing things like how some of the numbers impact the bottom line. When we see occupancy income, concessions, and in particular bad debt, what does it mean other than just a set of numbers? It can mean the difference between cash flowing and meeting goals or not.
Tied to these financial areas are two important aspects including the applicant checks and the handling of unpaid balances. We have many options when it comes to resident screening, most accessing the same information to provide your data. We also need to take into consideration there is a delay between when negative information is provided to the credit agencies and when it will show up on an account, which includes late payments, judgments, evictions, etc. Approval, conditional, and denial parameters can be set with any of the software programs, which provide guidance in reaching your decisions. One of the most useful technology changes we have had over the years is having these systems, which takes subjectivity out of the approval process. In the past we received a credit report from one of the reporting agencies (Equifax, Experian, TransUnion), looked at the data, and made decisions with many variables to consider. Today the variables can be programmed in, providing for a better handling of Fair Housing issues as well as a way to set and track scoring as markets and the economy changes. In addition to Fair Housing and the data tracking, many other tools such as "what if" scenarios are available...but seldom used. A recent conversation with a property manager brought up the first part of this topic, the "checks" aspect. She said her corporate office set all the guidelines and "what if" or other database information was not reviewed with her regional or anyone from corporate. She basically said, "I've been told it wasn't my job!" My response to her was, if no one else is offering why don't you ask to review and provide input. She indicated they were recently seeing more conditional and denial responses, her occupancy was being challenged, and she basically felt the blame was on her. Not the first time I have heard this coming from a site manager, and probably won't be the last. She had called me as she felt her position was in jeopardy, and since I was no longer her regional (which we used to review and revise based on her recommendations when we worked together) this aspect of oversight had been taken out of her hands but not the responsibility. So let me understand this correctly, we want to hold them accountable but not give them the responsibility that goes along with it! I politely told her to approach her regional and if she did not get anywhere...she might want to give her resume a review. The ease with access of this information so you can monitor and evaluate (being pro-active versus re-active), the rapid ability to make changes because of technology, and the ability to use the tools available are what makes these systems so great. The other thing I hear managers say is they may review quarterly and make adjustments, even though market conditions as we all know can change weekly. Unfortunately in our changing environments and quickly changing economic conditions, by the time you make the changes it is too late. What we would have given for these tools to be available even fifteen years ago, and to see them not being used to their fullest is shameful.
The other part of this is the "balances" aspect. We all know the job market is let's say "challenging," and this is not to mention with higher gas and other expenses the trend seems to be witnessing higher evictions and collection issues. The days of "promise to pay," or payment plans I believe have ended. Once someone is in financial distress, looses their job, or simply does not budget and manage their finances well, the handwriting seems to be on the wall. Four areas of prompt response and action are critical to minimizing bad debt, however, we appear to have conditioned our management teams to stay with the old standard ways of handling.
1. Review the application and credit report for credit card data. Managers may ask a resident who is late when they can pay (with promises that many times go unfulfilled), and of course send the "legal" notifications as required by state statute and company policy. Those legal notifications and policies should continue, however, in this day and age we need to look outside of the box and maybe look at the credit information. "Mr. Smith. As you may be aware to handle this from an equable position as well as from a legal standpoint, we do not have any options other than what is being done. We often find residents have options they have not thought of and that would be to use credit card resources in challenging times to bridge their situation. In reviewing your file, we see you have open credit card lines which may be able to assist you in avoiding necessary legal action." Also asking if they have relatives or anyone that can assist them is not out of line. This also many times diffuses some of the tensions as landlords (those evil people), and lets them know we are also looking at all solutions and not just the legal solution.
2. Process all necessary notices and file or submit for legal action consistently in the shortest time possible. Waiting a few extra days sets precedents, which also can have legal ramifications, and sends a message to other residents that it may be ok to not pay your rent on time. This delay can also raise Fair Housing issues, which you do not want to deal with. Being selective on who you file on because "Mrs. Smith is always late but she eventually pays," can also bring about litigious concerns as well as fiduciary ones as representatives of an owner. Collecting money is part of what we do as property managers, and while it is not the most fun thing to do it is our job. Don't like it...find another profession. It is also a proven fact the sooner you turn or begin collection efforts, the better you have a chance of collection.
3. One of the frustrations I hear from managers is by the time a judgment is posted through the court system to the credit agencies, the non-paying resident has already found a new apartment. The Fair Debt Collection Practices Act does not state you cannot turn over money owed to a collection company before you get a judgement, which can in turn report the amount owed to the credit reporting agencies. Make sure your documentation including lease allows this, as well as any state statutes are not preventing you from moving forward with legal action and allow for this type of action. Just be reminded, if you turn over to a collection agency you will owe them a fee if they collect.
4. Don't be afraid to ask for the apartment back if they say they have no options and will not be able to pay. Give them the benefits, which do not negate your ability to seek the money through collection efforts. You may find several benefits here. (1) You mitigate the bad debt on your financial. (2) You can get the apartment back to turn and get ready for a "paying" resident. (3) You avoid legal and court costs which in many cases you cannot recapture.
Many managers I find do not look at the options they have and how to handle outside of the ways things have always been done. I urge leadership to give them responsibility, encourage out-of-the-box thinking, and work smarter and not necessarily harder when it comes to financial and other management/leadership issues.
Thursday, August 4, 2011
Fair Housing
One very important aspect of our responsibilities as property managers is compliance with fair housing. Having attended many educational events related to the topic, I find it interesting as to how this subject is usually taught. For some reason instructors and course leaders teach by what I call "intimidation" rather than through education. Almost all of the teachings are telling our teams what we want them to avoid, rather than teaching them what we want them to do. I relate this to a simple example which I believe is relevant. If our property personnel are concentrating on the negative and constantly looking over their back, will their efficacy be diminished in reaching goals and objectives in front of them? I believe the answer is yes.
I have also found in my studies and teachings that over 80% of our teams cannot tell you what the seven protected classes are, and this includes upper management. If executives and upper management don't know, how can they effectively lead others in any area so important. How many of you can state without beating your head against the wall or guessing, what the classes are? I rest my case! If our team members don't know the classes, they cannot fully practice fair housing and therefore increase the chances of a violation. Again, can't hit a target if they can't see it...or don't recognize it as a target!
By presenting what we want our people to do rather than what we want them to avoid, we serve the same purpose while keeping them focused on the target in front of them. We tell them how lawsuits, fines, HUD and other pitfalls can expose them and their organization, and focus on what ramifications are if they are in violation. Basically we "scare" them into what they need to avoid from a fair housing standpoint not what they should be doing, again keeping them looking over their shoulder rather than forward. While violation action can be scary, I believe there is a very different way of presenting this topic.
1. Give them examples they can relate to when it comes to fair housing. Professional trainers know if you can provide relative information and present it in a manner people can relate to, they will retain it. The term used is cognitive recognition where our minds understand something because it provides a conscious awareness of it.
2. Instead of an annual refresher, condition your team of protected classes with subliminal reminders. This might include simple reminders at the bottom of emails above your address information. It also includes occasionally asking at site visits of ALL personnel on a site the classes are. Almost 96% of my research shows service has no clue what they are either, even higher than our office staff.
3. Be gentle in reminding some of the pitfalls, and don't use intimidation as a training tactic. As an example asking a leasing person how something could be perceived if I offer refreshments to one person and not another. Remember, most fair housing complaints are based on "perceived" treatment making it more subjective than objective.
4. Ask for their experiences of how they feel they may not have been treated fairly. This could be related to job, shopping, customer service, or other areas. Their experiences and feedback again provide relevance to that perception factor in fair housing. Remind them also that treating others "fairly" is only part of the picture, as the word "equal" is also part of what we do. Sometimes people try to distinguish between the two, with either one of them being considered in fair housing. We cannot assume corporate knows Fair Housing either. Many CEO's, CFO's, and COO's have never run a community or even been in a position of regional manager or VP. This is especially true of those working on our web sites and someone that might be in the position of CIO (Chief Information Officer). Very recently I was looking at a position with a company as their regional manager and doing my homework as I always do. At one of their property sites they had listed the application fee was, "$25 for single and $50 for married couples." Does anyone other than myself see how this is a direct violation of familiar status? I found another site while doing some consulting work for another company where they stated, "we do not allow pets so don't ask." Not only was this a very unprofessional way of saying something, it also could turn away someone with a service animal where they may think this could be construed as discriminatory.
Fair housing is basic and not complicated. Treat everyone with "respect," "dignity," and "kindness," and you will be in compliance. We all have the right to be treated fairly and everyone wants to be treated equally. Give them a target they can understand and see, and they will hit it.
http://gan.doubleclick.net/gan_click?lid=41000000031855266&pubid=21000000000389926
I have also found in my studies and teachings that over 80% of our teams cannot tell you what the seven protected classes are, and this includes upper management. If executives and upper management don't know, how can they effectively lead others in any area so important. How many of you can state without beating your head against the wall or guessing, what the classes are? I rest my case! If our team members don't know the classes, they cannot fully practice fair housing and therefore increase the chances of a violation. Again, can't hit a target if they can't see it...or don't recognize it as a target!
By presenting what we want our people to do rather than what we want them to avoid, we serve the same purpose while keeping them focused on the target in front of them. We tell them how lawsuits, fines, HUD and other pitfalls can expose them and their organization, and focus on what ramifications are if they are in violation. Basically we "scare" them into what they need to avoid from a fair housing standpoint not what they should be doing, again keeping them looking over their shoulder rather than forward. While violation action can be scary, I believe there is a very different way of presenting this topic.
1. Give them examples they can relate to when it comes to fair housing. Professional trainers know if you can provide relative information and present it in a manner people can relate to, they will retain it. The term used is cognitive recognition where our minds understand something because it provides a conscious awareness of it.
2. Instead of an annual refresher, condition your team of protected classes with subliminal reminders. This might include simple reminders at the bottom of emails above your address information. It also includes occasionally asking at site visits of ALL personnel on a site the classes are. Almost 96% of my research shows service has no clue what they are either, even higher than our office staff.
3. Be gentle in reminding some of the pitfalls, and don't use intimidation as a training tactic. As an example asking a leasing person how something could be perceived if I offer refreshments to one person and not another. Remember, most fair housing complaints are based on "perceived" treatment making it more subjective than objective.
4. Ask for their experiences of how they feel they may not have been treated fairly. This could be related to job, shopping, customer service, or other areas. Their experiences and feedback again provide relevance to that perception factor in fair housing. Remind them also that treating others "fairly" is only part of the picture, as the word "equal" is also part of what we do. Sometimes people try to distinguish between the two, with either one of them being considered in fair housing. We cannot assume corporate knows Fair Housing either. Many CEO's, CFO's, and COO's have never run a community or even been in a position of regional manager or VP. This is especially true of those working on our web sites and someone that might be in the position of CIO (Chief Information Officer). Very recently I was looking at a position with a company as their regional manager and doing my homework as I always do. At one of their property sites they had listed the application fee was, "$25 for single and $50 for married couples." Does anyone other than myself see how this is a direct violation of familiar status? I found another site while doing some consulting work for another company where they stated, "we do not allow pets so don't ask." Not only was this a very unprofessional way of saying something, it also could turn away someone with a service animal where they may think this could be construed as discriminatory.
Fair housing is basic and not complicated. Treat everyone with "respect," "dignity," and "kindness," and you will be in compliance. We all have the right to be treated fairly and everyone wants to be treated equally. Give them a target they can understand and see, and they will hit it.
http://gan.doubleclick.net/gan_click?lid=41000000031855266&pubid=21000000000389926
Wednesday, August 3, 2011
It's about people
In this age of technology we expect everything right now and it to be error free. Other expectations include communications to be immediate, everyone to be understanding, have cognition of others emotions and feelings, and Lord forbid don't forget to respond to my Facebook posting or tweet. We have transitioned into an age of computer animation and computer graphics where it is becoming hard to distinguish between the real and make believe. Today schools give our children laptops where then can Google the answer, instead of using their mind to search for the information and learn along the way. Using a calculator in Algebra class is common place, where before determination and methodology expanded horizons because we had to think about how we attained the answer. Try calling any major company without getting, "Press one if you want to do this, or press two if you want to do that," and you'll wear the numbers out on your telephone keypad just trying to get someone to listen to you. Our world today is in bits and bites, and our lives have somehow become stranded in the sequence of programming data and removed us from the basis of who we really are...people.
A resident has a problem or a guest has visited and given us an email as part of their contact information and what do we do, we take the easy way out. I'm waiting for the day when a guest card asks for their Twitter information and we will only communicate in a few words or letters and have to go to things like IYRWAACM. Ok, for those of you that didn't get that I said, "If you really want an apartment...call me." When did we stop dealing with people and forget the cell phone, email, twitter, and computer does not care or make decisions on where they choose to live?
I was visiting a community the other day and actually heard a leasing person say after a potential resident had just left, "I don't know why she would not give me her email. Now I have to call her!" I was visiting this community related to some market research I was doing, however, wanted to walk over to her and give her the V8 pop on the head. OMG, she's going to have to actually have follow-up communication with her which may not be the standard form email she was used to sending out, and maybe have to re-sell herself and her community.
Could it be we are not reinforcing the basic "people skill" essentials and therefore "dumbing down" our team members, which in turns hurts both our lease percentages and renewals? We are taking for granted basic communication elements which I believe our residents and prospects really want. Those elements include to be able to speak with a real live caring human being and not have to press a number that takes them to resident service hell, and to be listened to and not just communicated to. Ok, call me old fashioned! The same people who want all this instant stuff are the same ones today I hear complaining about not being able to talk to a real live caring human being. Maybe, just maybe, we need to go back to the premise that people should be put back into the equation. After all, try getting your smartphone to physically sign a lease or renewal. It still takes a person (Webster: 1. Human being, 2. Human body) to make the decision and pick up the pen. It's all about people!
A resident has a problem or a guest has visited and given us an email as part of their contact information and what do we do, we take the easy way out. I'm waiting for the day when a guest card asks for their Twitter information and we will only communicate in a few words or letters and have to go to things like IYRWAACM. Ok, for those of you that didn't get that I said, "If you really want an apartment...call me." When did we stop dealing with people and forget the cell phone, email, twitter, and computer does not care or make decisions on where they choose to live?
I was visiting a community the other day and actually heard a leasing person say after a potential resident had just left, "I don't know why she would not give me her email. Now I have to call her!" I was visiting this community related to some market research I was doing, however, wanted to walk over to her and give her the V8 pop on the head. OMG, she's going to have to actually have follow-up communication with her which may not be the standard form email she was used to sending out, and maybe have to re-sell herself and her community.
Could it be we are not reinforcing the basic "people skill" essentials and therefore "dumbing down" our team members, which in turns hurts both our lease percentages and renewals? We are taking for granted basic communication elements which I believe our residents and prospects really want. Those elements include to be able to speak with a real live caring human being and not have to press a number that takes them to resident service hell, and to be listened to and not just communicated to. Ok, call me old fashioned! The same people who want all this instant stuff are the same ones today I hear complaining about not being able to talk to a real live caring human being. Maybe, just maybe, we need to go back to the premise that people should be put back into the equation. After all, try getting your smartphone to physically sign a lease or renewal. It still takes a person (Webster: 1. Human being, 2. Human body) to make the decision and pick up the pen. It's all about people!
Thursday, July 28, 2011
Teaching the Teacher
I have been conducting CAM and CAPS classes for NAA for almost two decades (Lord that sounds old when I say that), and have been fortunate enough to be on the NAA Education Committee and serve as a subject matter expert on re-writing several of the modules with those designation programs. Today, was another day of teaching and learning which is the exciting part of what I do in addition to making new friends. It never amazes me that while I am there to lead students into an educational experience, I always have "take-away's," which I benefit from.
While facilitating the Risk Management course and leading the discussion, several great points were raised and we had some great questions. One of them dealt with private security at an apartment community and addressing crime problems they were attempting to overcome. This community which was a condo conversion to rentals, had been experiencing criminal activity as well as resident issues. Drastic steps were being taken to "re-position" the community, including hiring not just security (or patrols), but "armed" patrols. The owner of the site had handled the contract side of it, and the manager while being active in the action, brought up her part in working with them. Now if "armed security/patrols" scares anyone, there are many pitfalls and concerns that follow the path to the intended result. Our industry has been careful not to use or "imply" we provide security or can guarantee a safe and secure environment. The reason is we cannot guarantee security or safety, and no matter what we do things can happen beyond our control. Crime can happen anywhere including home, work, or simply picking up a gallon of milk at the grocery store. The question came up, "Does the badge worn by the patrol representatives which has security on it imply or provide a false sense of security?"
After contacting an attorney friend, the answer he gave was the usual attorney response "it could." Did not say it did, however, cautioned how it could be interpreted in a lawsuit or litigation should one be brought. The courts have gone both ways, however, mostly in favor of the resident or visitor at a property. As we all know insurance carriers are often trying to avoid court action and will settle if there is anything related to the case they are not comfortable with. He also asked what I brought up in the discussion, "Does your insurance carrier know this could be interpreted as implied based on their uniforms and armed status?" In this case he again was not direct, however, stated if he was representing an injured or victim in this case he would use it if he could.
Our jobs as professional property managers and as fiduciaries for owners is to bring these concerns to the forefront. The owner may wish to not investigate the challenge, however, you have done your job by bringing it up and documenting the communication. In this litigious and changing society, we are constantly hitting a mobile target and having to look at new risks and challenges. A good debate and discussion ensued related to this topic, and if nothing else opened everyone's eyes to what we face and what we need to be aware of in the decisions made by both us and by owners of our properties. This became a learning point for everyone, including this old codger who then had to investigate and obtain information making me understand more about what we do.
Good lesson for everyone.
While facilitating the Risk Management course and leading the discussion, several great points were raised and we had some great questions. One of them dealt with private security at an apartment community and addressing crime problems they were attempting to overcome. This community which was a condo conversion to rentals, had been experiencing criminal activity as well as resident issues. Drastic steps were being taken to "re-position" the community, including hiring not just security (or patrols), but "armed" patrols. The owner of the site had handled the contract side of it, and the manager while being active in the action, brought up her part in working with them. Now if "armed security/patrols" scares anyone, there are many pitfalls and concerns that follow the path to the intended result. Our industry has been careful not to use or "imply" we provide security or can guarantee a safe and secure environment. The reason is we cannot guarantee security or safety, and no matter what we do things can happen beyond our control. Crime can happen anywhere including home, work, or simply picking up a gallon of milk at the grocery store. The question came up, "Does the badge worn by the patrol representatives which has security on it imply or provide a false sense of security?"
After contacting an attorney friend, the answer he gave was the usual attorney response "it could." Did not say it did, however, cautioned how it could be interpreted in a lawsuit or litigation should one be brought. The courts have gone both ways, however, mostly in favor of the resident or visitor at a property. As we all know insurance carriers are often trying to avoid court action and will settle if there is anything related to the case they are not comfortable with. He also asked what I brought up in the discussion, "Does your insurance carrier know this could be interpreted as implied based on their uniforms and armed status?" In this case he again was not direct, however, stated if he was representing an injured or victim in this case he would use it if he could.
Our jobs as professional property managers and as fiduciaries for owners is to bring these concerns to the forefront. The owner may wish to not investigate the challenge, however, you have done your job by bringing it up and documenting the communication. In this litigious and changing society, we are constantly hitting a mobile target and having to look at new risks and challenges. A good debate and discussion ensued related to this topic, and if nothing else opened everyone's eyes to what we face and what we need to be aware of in the decisions made by both us and by owners of our properties. This became a learning point for everyone, including this old codger who then had to investigate and obtain information making me understand more about what we do.
Good lesson for everyone.
Monday, July 25, 2011
Expecting the Unexpected
First, I want to thank everyone for the great response I have received from the newly created workshop, "Expecting the Unexpected - Emergency Preparedness." It appears to be a huge success and important topic that is often overlooked unless you are taking a CAM or CAPS class. (or unless a hurricane is coming your way)
Emergency preparedness is not difficult to maintain, however, takes some work to establish a program that can be critical related to life, property, and financial implications. Every apartment community in this country faces threats which can have an impact on the community, its reputation, and its financial stability. Whether it be fire, flood, storm, ice or snow incident, earthquake, or other disaster, being prepared can lead to a recoverable condition and one you can make sound judgement decisions on both during and after the incident.
The workshop covers how to formulate a plan. Who is responsible for developing and understanding the plan? What disasters does your community face and how you can be pro-active and not just re-active? Who can communicate with the media and what should they communicate? How to respond in protecting the asset to minimize further damage or injury. How can you establish a communication channel to your team members, owners, and superiors in the light of an event? What should be included in your plan and emergency preparedness kit?
The recent fire at an apartment community I used to manage brought back memories of incidents my teams and I have had to be prepared for and respond to. Several fires, multiple floods, tornado's, hurricanes, snow and ice related storms, and the occasional police responded event which created a media headache are just a few. If you have ever had an entire building burn to the ground with everything owned and cherished by the valued residents being destroyed or ruined, you would understand the importance of this topic. We assume our managers and teams know how to deal with these issues, however, until it is experienced you will never understand. Problem is we also fail to provide training and direction, and often just "expect" the team to know what to do. If you think about it, a vast majority of our managers may have never had to deal with a disaster.
To expect the unexpected, we have to train and coach our teams so they are prepared. I know regional managers and vice presidents that have never dealt with a large or major disaster, simply fall apart when something happened because they were never coached or trained either. Trust me, this is not something you want to just learn on the job.
If you are interested in how this one day workshop can provide tools your teams will have use, please contact me. It takes much more than a few policy paragraphs or pages in Operating and Procedures Manual for your team members to be prepared and expect...the unexpected.
Emergency preparedness is not difficult to maintain, however, takes some work to establish a program that can be critical related to life, property, and financial implications. Every apartment community in this country faces threats which can have an impact on the community, its reputation, and its financial stability. Whether it be fire, flood, storm, ice or snow incident, earthquake, or other disaster, being prepared can lead to a recoverable condition and one you can make sound judgement decisions on both during and after the incident.
The workshop covers how to formulate a plan. Who is responsible for developing and understanding the plan? What disasters does your community face and how you can be pro-active and not just re-active? Who can communicate with the media and what should they communicate? How to respond in protecting the asset to minimize further damage or injury. How can you establish a communication channel to your team members, owners, and superiors in the light of an event? What should be included in your plan and emergency preparedness kit?
The recent fire at an apartment community I used to manage brought back memories of incidents my teams and I have had to be prepared for and respond to. Several fires, multiple floods, tornado's, hurricanes, snow and ice related storms, and the occasional police responded event which created a media headache are just a few. If you have ever had an entire building burn to the ground with everything owned and cherished by the valued residents being destroyed or ruined, you would understand the importance of this topic. We assume our managers and teams know how to deal with these issues, however, until it is experienced you will never understand. Problem is we also fail to provide training and direction, and often just "expect" the team to know what to do. If you think about it, a vast majority of our managers may have never had to deal with a disaster.
To expect the unexpected, we have to train and coach our teams so they are prepared. I know regional managers and vice presidents that have never dealt with a large or major disaster, simply fall apart when something happened because they were never coached or trained either. Trust me, this is not something you want to just learn on the job.
If you are interested in how this one day workshop can provide tools your teams will have use, please contact me. It takes much more than a few policy paragraphs or pages in Operating and Procedures Manual for your team members to be prepared and expect...the unexpected.
Tuesday, July 5, 2011
OMG...Budgets are coming!
July is about the time we start thinking of budgets for the next year. That process with some companies starts as early as August/September, which is right around the corner. Budgets are one of the most feared tasks within the duties and responsibilities as professional property managers.
The only thing we have to fear is fear itself… and budgets! Ok, so maybe FDR said it a little differently. As property managers we wear many hats with one of them being experts in budgeting, or so we are supposed to be. Sleepless nights and long hours with visions of numbers are spent, only to have our hard work changed or questioned. Of all the courses we take and are offered they tell us how to be leaders, how to write and understand financial reports, how to manage risks, how to market our communities, and a host of other areas. One gap in the management fence seems to be in providing the tools in not only how to write a budget, but how to sell one. There is an art to selling a budget and even though changes may be made, the challenge is to provide a budget you can be proud of with accuracy and detail that makes it less likely it will come back looking totally different than the one you submitted.
Through understanding budget principles, adding backup and details to substantiate your numbers, understanding goals before the process is started, and having a budgeting map, you will find the budget process far less intimidating and something not to fear. The goal is to assist you in preparing for the upcoming budget season and removing some of those fears. Some of the key aspects to budgeting are as follows:
- Budgeting should not be thought of as an event, it is a process. Teach your managers to set up a budget file for the next year, immediately after completing their budget for next period. As an example, if you have just completed your 2011 budget and it is now approved, set up file for the 2012 budget. This way during the year they can put in notes and information (including some of the things on their wish list removed from the budget just completed). This can include things they see throughout the year, photographs, news articles, changing maintenance issues, trend information, marketing data, etc. By the time the budget process is started, you already have a significant amount of information to use and provide as backup.
- Understanding why we budget can sometimes enlighten us as to how we need to budget. Tell them the why as well as the how. Give them goals, just don't tell them to prepare their budget. They cannot hit a target if we don't let them see it.
- What is a CBA and how can it assist in the sales process? Teach them what a Cost Benefit Analysis is and how it can be used to "sell" their budget and items within their budget. Remember upper management and owners are interested in one thing (mostly)....that is cash flow and NOI!
- What details and information make your budget more justifiable and less the opportunity for change? This includes photographs with notations and proposals, specifications that detail what is included in a proposed project, reliable market trend and data information, and what was given as goals and objectives and how they fit into the budget presented.
- How do photographs play a part in your presentation, and how to tie them to your budget? They say a thousand words and tell a story. If you are having roof issues, provide pictures that tell the story. Use Photoshop to place arrows on photos identifying areas of concern or safety identification markers. I have even had managers put together a Powerpoint presentation with their budget that was extremely effective in selling their budget.
- What is the best way to present a budget and what tricks can be the icing on your budget cake? The words we use and how detailed the budget is will be the difference between something being considered and something they will take our or disregard. An example of how effective wording can play a part is as follows:
- We have two roofs this year that have gone beyond the repair stage based on expert and comprehensive evaluation. The loss of income from four residents this year (which has occurred, based on feedback received) would more than pay for the required replacement. The attached photographs depict the severity of the issue, however, we would be more than happy to assist you on a personal visit to verify the information.
- Attached are photographs of our parking and drive areas, which as you know we deferred repair in the budget last year. Unfortunately, the deferred funds estimated at $58,000 if completed this year have increased for the coming year. Weather and use conditions as well as expansion of some of the temporary patched areas per your request have created a higher level of work, and do have an impact on the aesthetics and appearance of the community from both a prospect and resident perspective. The lowest estimate we have for inclusion in the coming year budget is $79,000.
- Three of our four direct and primary competitors completed forms of interior renovations in this last year. Photo's to substantiate this are included, as well as photo's depicting relevance of ABC Apartments. Reviewing objections from prospects who did not rent at ABC Apartments, the reason to lease at a competitor came down to upgraded conditions at the competitor were documented in over twenty prospects and has had a direct impact on reaching occupancy and income goals.
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