How to renew more residents, project occupancy, and navigate uncertainty - Renewal Series, Part 1
by Christin D. on 5/27/2020 12:18:00 PM
How do you project future rent trends with the pandemic’s anomaly influence on the multifamily industry? Can you properly budget for your future turn expenses and maintenance costs associated with turnover without a clear picture or access to the soon vacant unit? Delinquencies nationwide are higher than typical and recapturing funds is important, but other conversations will support future planning efforts if navigated with intent. Below we will uncover some other components of how renewal follow up strategy can help reveal a more accurate forecast amid pandemic imposed uncertainty.
120 - 90 days in advance, renewal offers are sent to current residents. Offers are generated by market rent suggestions based on market survey rent reporting statistics, technology driven, or by hand. Whatever the case may be, those offers generated and sent in early February are a great way to drive residents away from you community and increase move outs. So, how can you navigate the unexpected downturn and preserve your property from plummeting in occupancy? Renewal follow up strategy is the answer. Strategic action is the way to future stability, and it starts with the residents you already have.
ACTION 1: “Save” residents on notice-to-vacate
Without urgency, nothing will come from the act of saving notices. Urgency as represented here is not outward, it’s inward, and the intention behind the effort. Every day you wait that resident is looking for a home. Start now and work backwards listing all residents on notice in good standing and delinquent, and identify the “keepers”. Targeting the less risky renewals in good standing is the priority.
Set goals and work towards them.
How many do you think you can save? Now, add 20%-30% and set the bar high. Know your competition’s standing and develop some ideas on negotiations that could help seal the deal. Go to the respective person who would grant approval of your negotiation presenting the goal and how you intend to get there. See what negotiation tools you can use at your discretion. People act on emotion and change their mind, so time doesn’t work in favor of these efforts. Once you have that “Yes”, send the lease instantly for execution and follow up within 24 hours. Maybe put a time limit on negotiation offers for an “act now” influence to create urgency. Then close it as fast as possible.
If they don't cancel, get details.
If they don’t cancel the notice, ask them why? Get specific but don’t get defensive. Listen, but also find ways to sell the future today. Empathize, and overcome objections with a solution to concerns. Finally, if they go anywhere else find out how you could improve things for other residents. Getting the most out of a resident who has given notice to live somewhere else lies in the questions you ask, then in how you respond. If you know your market and your property weaknesses and shortcomings, you can develop ways to offer solutions as a response to others.
ACTION 2: The pre-pandemic “Yes” who still hasn’t signed the renewal
Calling the “Yes, we want to renew we just haven’t signed our renewal” residents requires the same level of urgency used when saving the notice-to-vacates. They could be shopping around! Prepare any re-negotiations or incentives before picking up the phone. Knowing what tools are available eliminates delay that will give renewing residents time to change their mind.
If they aren’t sure if they want to renew, take the same approach in trying to get a resident who already gave notice to stay. Ask the leading questions, listen, and use any negotiation tools you have to win them over. Once they sound the slightest bit engaged, set expectations for your next actions with narrow timeframes, but come across as concerned, not pushy.
What if they now aren’t sure about renewing or have a past due balance?
What if they are now delinquent on rent because they lost their job? There is a difference between a hardship imposed by pandemic, and one imposed by habitual late rent. The clues to the cause lie in the payment history. If a resident has been in their home for over 6-8 months with only one late payment, it’s possible the pandemic has cost them their job.
Management companies who are willing to consider an alternative to the conventional best practices in pre-pandemic times will be more likely to save on the cost of turning the unit and finding a new lease later. An example of non-conventional in this case? Trial utilizing shorter terms, or month-to-month can minimize the risk if things don’t improve soon and minimize the chance of being stuck with a non-paying resident.
What ideas can you generate?
There is no doubt that the pandemic imposed economic shifts were unexpected. For multifamily and many other industries, outside the box strategies are crucial to preparing for the next wave of uncertainty. Stay ahead navigating the current climate and have a plan.
We hope you look forward to our next chapters in renewal strategies, which will include articles on delinquency strategy, maintenance turnkey scheduling and realistic spend forecasts.
Communicating in socially distant times featuring Courtesy Connection
by Christin D. on 5/4/2020 6:44:00 PM
Social distancing has become a familiar concept as the recent pandemic threat continues to effect communities world-wide. Defined by the CDC as, “keeping space between yourself and other people outside of your home”, the 6-foot recommendation is strongly encouraged to prevent further spread of illness. This and other health and safety recommendations have created an immediate need to adjust operational protocols to ensure the safety of residents and team members, while continuing property operations. But how do you continue to operate without being able to physically connect with prospects and residents on-site?
Onsite teams immediately responded to new restrictions imposed by the pandemic, coming up with ways to still connect with communities despite absence of physical presence. Smartphone and video conferencing technologies have allowed teams to create new virtual solutions helping to continue “business as usual”, when it is anything but. Eager to support these efforts, multifamily suppliers have quickly launched changes to create streamlined operations and efficient practices, pandemic or not. Below are some new innovative ways to address social distancing and keep residents engaged in socially distanced times.
Courtesy Connection launches the ultimate solution to off-site phone follow up and there's an "app"!
On-site multifamily teams have traditionally reported in person to their respective communities daily and have been a consistent presence residents and prospects could rely on. The phone and ability to “call the office” has always been a vital part of on-site operations, and when calls go unanswered service and resident retention can suffer. With many teams and personnel repositioned off-site after the Covid-19 outbreak, Courtesy Connection, developed a new remote-friendly call solution to help bridge the gap. Now available via app on both iOS and Android devices, Courtesy Connection can provide owners and operators with a “call-masking” platform that allows remote telecommunications without revealing staff phone numbers. This new solution is fully integrated with most property management software systems and all calls are recorded and reported for record keeping and increased visibility. Ryan Nigro, the owner of Courtesy Connection introduced us to this new innovative solution and commented:
“When I was putting together Courtesy Connection's 2020 feature roadmap, a worldwide pandemic was not a contingency for which I had planned. When it started to become apparent that Coronavirus would dramatically change how we do business, we immediately changed course so we could focus on helping our clients remain effective, safe, and productive during this challenging time”.
This is one of many, brilliant solutions Courtesy Connection offers which are fully able to integrate with multifamily management software. For more information about Courtesy Connection visit www.courtesyconnection.com or contact Buyers Access for more information.
Mobile Doorman: your socially distanced "sense of community"
Mobile Doorman is a multifamily communication tool that makes it easier for property management teams to share messages with their residents. This software solution has an app available for residents to download on both iOS and Android devices. The app offers easy access to a variety of conveniences and activities, and improved communications with the property staff. Work orders can be submitted by residents, and management personnel can send messages, post announcements communicate more effectively with residents via the app. A win-win for everyone.
But the benefits don’t stop at the management team or business to consumer levels. Residents can also communicate with each other via the “virtual bulletin” feature, while staying sheltered in place. Reaching even further is the ability to support local providers through the Mobile Doorman Marketplace, where businesses can advertise specials in the area viewable to Mobile Doorman users. Who doesn’t want to support restaurants and grab a to-go order? Additionally, with many amenities closed, virtual resident events are gaining popularity. Mobile Doorman has an invitation and RSVP feature to schedule events, provide details and encourage participation. Work orders, amenity rentals, and other features exist, and the system is updated automatically through integration available with most major property management software platforms. For more information on Mobile Doorman visit www.mobiledoorman.com and email our friend Mikel Persky for more information at email@example.com.
Please share your pandemic new and innovative strategies with us!
Service and communication are at the core of multifamily community success. Without it, the sense of purpose and belonging is difficult to maintain. The multifamily industry, whether owner, operator or supplier, have all had to dramatically adjust to “socially distancing” times. Innovative solutions at all levels have not only made operating under new challenges easier but offer new efficiencies long-term. Buyers Access has over 50 supplier partners and leverages over 750K units, helping companies and properties to optimize purchasing, forecasting, best practices, processes and technology solutions. Please feel free to ask how we can help you! For more information visit www.buyersaccess.com or email us at firstname.lastname@example.org.
Smart purchasing practices can save BIG money! As featured in Colorado Real Estate Journal's Q1 Multifmaily Properties Quarterly edition
by Christin D. on 4/21/2020 11:03:48 AM
Are your vendors covered? Is the coverage enough? Is the coverage active? How can you be sure?
by Christin D. on 1/28/2020 3:50:00 PM
Vendors and contractors without the proper insurance coverage can cost your management company, property owner, and/or investors millions.
Those Certificate’s of Insurance sent in the mail to properties and corporate offices turn out to be pretty important after all! A vendor without a valid COI that shows the information that is needed to transfer the risk off of you and on to them, you are assuming the risk for their actions when hiring them to perform work at your property, and it will cost you. Even if expired for just one day, if the vendor policy is not active and an incident occurs, it’s going to be hard to get the risk off your shoulders; and you probably won’t. That’s why monitoring vendor and contractor insurance coverage is so important and needs to be a top priority daily, but how do you possibly do it when you are at the mercy of your on-site responsibilities?
Property teams have daily tasks that are best practices within the multifamily industry. These tasks can range from “sparkling” vacant and model apartments, preventative maintenance inspections, grounds clean up, and turn-key operations, to name a few. Residents in and out of the office day after day make having a solid hour or two to verify insurance for vendors next to impossible. The struggle!
Insurance compliance is often an afterthought until it matters and doesn’t make that to-do list every day. Often vendor insurance isn’t checked every day; they come onsite, especially painting and carpet contractors, and we assume it’s valid because they come often, and you are sure it’s the same, right? The responsibility to manually verify the coverage is active would be needed to ensure 100% compliance every time they came to paint an apartment. That is unless you aren’t the one monitoring, and you have a database that will send you an alert when a lapse of coverage exists so you know not to let the vendor begin until corrected. There is a better way.
Why hire a 3rd party
RMIS is a program that exists in the multifamily management space that handles all vendor compliance, coverage verification, and like activities for you. RMIS will invite your vendors to register with them and track all the information in a custom database. This saves the operating team from missing coverage lapses, details on stipulations, and other crucial components. Wouldn’t it make more sense for the on-site team to focus on managing risk on the physical asset in real-time, daily than doing administrative checks and balances, leaving risk unnoticed?
Life before and after RMIS – what a transformation!
Look at the comparisons in the table below and see for yourself just how much time you get back by outsourcing this crucial step to a service like RMIS.
WITHOUT RMIS’s help YOU must:
WITH RMIS, you are relieved of managing:
Keep your records up to date with all vendor and contractor W-9 and COI forms.
The vendor onboarding process is initiated and managed from start to finish by RMIS.
Ensuring coverage is active by checking the dates on the COI.
Customer and vendor support provided through RMIS team members who are available for on-site teams to contact for any insurance needs.
Checking for coverage limits and types.
Daily vendor monitoring to ensure active coverage is in place, consistently.
Validating that the interested party is listed correctly on the COI to cover your property.
Obtains coverage documents if expired on behalf of the property management team
Promptly requesting all non-compliant information, manually, and entering corrections submitted from vendor insurance companies or the vendors themselves.
Verification of background screenings and proper licensure.
Obtain vendor COI upon expiration and re-verify coverage and other requirements.
Analysis of COI’s to check: coverage limits, coverage types, additional insured clauses, Waiver of Subrogation, records policy numbers, tracks effective and expiration dates, and other items as needed by management companies.
Ongoing management of everything in the next column, without 3rd party support or resources to save time and prevent expensive oversights.
Upkeep of all of the documentation, processes, and certifications that are accessible on-demand and customized for your company requirements.
If you do this one thing
If there were doubts about whether hiring a vendor insurance compliance partner to track insurance coverage for you, we hope we convinced you there is a better way! Many may have already known the extreme amount of time and effort this process takes and how important it is to do consistently, yet struggle. It’s a tall order and quite an undertaking on your own, and it’s unnecessary to do it alone. If you are already a Buyers Access member and want to get this service set up free, contact your Account Manager and get connected! Not familiar with Buyers Access? Click HERE and explore a whole new way to drive NOI through our robust purchasing and procurement solutions HERE or contact us at email@example.com
. If you email us or request to be connected, 90% of the work is already done, and we take care of the rest.
There. Is. A. Better. Way.
Rent Growth VS. Expense Optimization - How do you measure up?
by Christin D. on 1/7/2020 4:50:00 PM
Another great way to drive NOI – rent growth alone is so 2019!
Pushing rent increases to drive NOI and relying on income alone sooner or later will take a back seat, and expense optimization will again prevail as the industry cycle moves towards economic slowdown. Multifamily management firms that stay ahead understand that NOI through expense optimization can be achieved easily by partnering with a Purchasing and Procurement Service Organization.
While intelligent expense management is always a common goal among companies, the opportunities to maximize this area of your business are on a different plane. Purchasing optimization as a strategy to drive NOI requires resources and expertise at a different caliber than one can do alone, which is why you need a specialized Purchasing Optimization Organization to partner with like Buyers Access.
Purchasing Quiz: Your purchasing defined
Activity: Select the number of each statement that your company currently has in place for purchasing and procurement activities.
- Onsite teams have the necessary tools to complete purchasing activities effectively through our company resources and systems.
- Our current payables process eliminates pricing and invoicing discrepancies.
- We have the best pricing negotiated with multifamily industry MRO suppliers such as Home Depot Pro Multifamily, HD Supply, Maintenance Supply Headquarters, and like organizations.
- The procurement department handles purchasing activities at our company. For larger projects and renovations, we have regional maintenance and construction project managers that ensure efficiencies.
- Our company has reporting metrics that track product spend, pricing, contractor scopes, and uncovers opportunities for further optimization.
- We have less than 1000 units and don’t need a purchasing service.
Now that you have your numbers match them with the numeric category below and unlock insight into how to better drive NOI through expense optimization.
Don’t skip anything!
"Our site teams oversee our purchasing operations and have a (weekly) report they turn in showing the efficiency."
Operating efficiency is becoming harder to achieve and the reliance on site teams to a level that drives NOI is sadly unrealistic. Staffing challenges plague the multifamily industry, especially in maintenance. Residents also are now expecting an “On-Demand” lifestyle now that services like “Amazon-Prime” and others are able to deliver faster than ever. The expectation as created the same “On-Demand” expectations for residents and site-teams have to work fast! We can’t overlook it or balk on adopting it, we must keep up with innovation and deliver. Residents are the number one revenue driver in the multifamily industry so taking care of them to exceed their expectations is important and takes priority. Take care of your teams and your residents and place purchasing optimization in the hands of an inclusive purchasing organization specializing in the multifamily industry, such as Buyers Access.
"Our site managers oversee our payables and are always catching duplicate invoices and price discrepancies right when they happen."
That is a good start, but your manager has so much more on their plate, such as monthly renewals, aggressive rent increase rates challenging retention efforts, overseeing maintenance, etc. The leasing teams, can they help? Where is maintenance? The leasing teams are fighting for their life to get leases and keep the property stabilized while growing GPR (Gross Potential Rent) in a highly competitive market. Maintenance is short-staffed and over-worked, your lender inspection is next week. Let us be the solution. Buyers Access gives on-site teams additional bench-strength through people who support daily purchasing activities, reporting, and contractor sourcing on-demand.
"We have contract pricing with our suppliers already, and we get bulk discounts as it is."
Activity: Test your consistancy-
Let’s validate the price on one item by answering a simple question. You can do this on your own to see if this solution is performing at its highest potential.
- Were you charged the same price on every faucet of the same item number from the same supplier in 2019 company or portfolio-wide?
- If not, how many different prices were you charged for that same faucet from the same supplier in 2019?
"Our procurement department already standardized the company product selection and negotiates these deals."
Having a procurement department is wonderful! Can your procurement department offer "On-Demand" support to your on-site maintenance and office teams to help with things like emergency contractor sourcing, returning incorrect items received, etc.? Do they offer an all-in-one eCommerce site to minimize the risk of pricing errors, save time through automation, or work to source and select "top-item" lists? Buyers Access' model is inclusive and will provide both managers and leadership visibility through customized reporting in real-time, approval controls, and other innovative solutions and strategies.
Are you still trying to figure out the answer to the faucet question in category 3?
- Let’s talk reporting.
The visibility you gain through operating data-driven purchasing activities makes answering this question easy. You may be struggling, and that is okay. Line item analysis and segregating products in GL code reports by supplier and item type can take a lot of time, time you may not have or can be better spent focusing on resident retention. Once you do find these metrics, the second part is cross referencing to ensure that agreed upon or "contractor" negotiated pricing between you and your supplier pricing was used 100% of the time, company-wide.
You do want the same low prices each time, correct? Of course you do! And why work harder when you can work smarter?
And finally.... Scenario 5
"We have less than 1000 units and don't need any purchasing optimization."
If you are under 1000 units and don’t think that this is applicable, think again! We have a special Small Units Program that leverages resources to get them the same deals realized by larger organizations when buying maintenance and repair supplies. Click here to learn about our Small Units Program now.
AND....Back to the Faucet activity in Scenario 3 ... Did you find the answer?
My final proposal for you is this:
Buyers Access will answer your faucet question AND will uncover the total savings opportunities based on your companies personal puchasing behavior for 2019. That takes care of time savings through finding the answer to the faucet exercise (and future pricing verifications) faster, and money saved through leveraged resources and strategy.
CLICK TO GET ACCESS- to begin the process.
We want you to make an informed decision about the fate of your NOI and we can show you your data, not a hypothetical example. We want you to have all the information to support your taking the next step and saving 10-20% on purchasing without sacrificing quality or quantity.
Thanks for playing and don't forget...
Rent growth as a strategy alone is SO 2019 and it's 2020!
October is Fire Safety Month in Multi-family
by Christin D. on 10/14/2019 5:34:31 PM
Welcome to Fire Safety Month
The month of October brings about some of the Fall seasons best comforts, as the leaves turn and the temperature drops. This can mean more pumpkin spice latte’s, or s’mores nights, social gatherings over delicious home cooked meals, and maybe throwing a few logs on the fire place. With the increase in heating and cooking during this time of the year there also comes the increased risk of fire. Because of this, October is known as Fire Safety Month. Whether you are a service provider, CEO, or on-site team member, as multi-family professionals, we all play a critical role in the area of fire prevention, precaution, and safety. So, what are some of the industry’s best practices in terms of fire safety?
Causes of Fire in Multi-family
Residential fires made up 29.1% of total fires by property type in some of the most recent data available, making it the second most common fire type behind outdoor fires. Closer living quarters and adjoining walls in multi-family structures increase the risk of fire. Fire in these structures can also impact more people and cause damage on a larger scale at a more rapid pace due to the co-existence of many in a single building.
Cooking fires made up 51.6% as the leading cause of all residential fires, with heating being the second most prevalent. The kitchen and bedrooms are also statistically the most common places for fires to start in residential homes. Residential buildings that include baseboard heaters, space heaters, electric stoves, and fireplaces heighten the risk of both instances occurring. For all these reasons and many more, ongoing fire safety and preparedness is extremely important for multi-family sites during October, the colder months, and throughout the year.
Provide Information in Advance
What things can we do as multi-family professionals to decrease fire risk? One of the most important things we can do is provide residents and teams detailed and easily understood fire information for education, training, preparedness and prevention. Furthermore, property management teams should have detailed working knowledge and training on how to respond to these emergency situations. Partnering with local fire departments, or Buyers Access vendors such as Cintas, is a great source to conduct fire safety training sessions with employees and residents at community gatherings. Get everyone as knowledgeable and prepared as possible, and be proactive!
Drafting a Property Specific Fire Safety Guide
When developing a fire safety guide to provide residents and team members, include a building diagram that marks the location of fire extinguishers, evacuation routes, stairwells, and fire pulls. The diagram should also identify designated exterior meeting areas for residents, vendors, and staff when evacuating the building. Other things to include are alternate routes for evacuation, additional stair access, tips for handling various emergency conditions such as smoke, being trapped, pets, and any other property specific information that may be helpful.
Time is everything when it comes to fire. Every 30 seconds a flame can double, filling up a room in a matter of minutes and making each second crucial. Organization and confidence should be a priority when training staff members on fire protocol. There is no guarantee that the community manager or service manager will be available to guide other employees during a fire, so it’s also important to plan and train accordingly. Team members gain confidence through education, and communication, role playing, and fire drills. Working with Buyers Access account managers and vendors can assist in this training process.
Types of Fire Safety Inspections
Multifamily communities have a critical responsibility to ensure certain fire and life safety requirements are always being met. Because of this, annual inspections are often required by local officials to ensure that code requirements are being met. Inspections on building fire alarm panels, pull station operation, fire extinguisher expiration dates, fire sprinklers, and visual requirements such as clear pathways are some of the more important fire related inspection items. If a property is in violation of any of these areas, authorities can issue an “order to comply” and issue fines until repairs have been completed.
Fire Safety Every Day
There are many other things to consider when protecting a community from fire hazards, which should be considered daily. Any time any fire safety device is malfunctioning it should be addressed and remediated immediately. Preventative maintenance inspections can serve as a great time to inspect interior and exterior fire safety devices. Encouraging residents to notify management of any safety risks is also helpful in case it is overlooked or not caught immediately by property staff.
A very common fire safety issue is burnt out “Emergency Exit” signs in hallways. Changing these bulbs promptly or utilizing LED bulbs in Exit signs, can minimize this risk. Fire doors should be automatically self-closing when the alarm sounds. Paying close attention to anything blocking these doors or preventing them from self-closing should be a priority, along with ensuring ease of ingress and egress in common areas at all times. If the fire doors are always closed, make sure self-closing and latching hardware are operating correctly so they consistently close immediately behind users.
Fire safety awareness is crucial no matter what time of year, and the above recommendations are a good start to protecting your property from associated risks. We hope you will apply some of the aforementioned best-practices into your fire safety routine. Buyers Access supplier partners such as Cintas and SmartBurner, can offer members quality solutions and services associated with fire safety. If you are in need of additional support or are curious on the savings you can realize by gaining access to the Buyers Access program, contact us at 1-800-445-9169 or by email Basales@buyersaccess.com. If your already a valued customer and are in need of assistance, reach out to member services by emailing firstname.lastname@example.org or contact your account manager.
Refuse and Paint Expenses- Budget Edition!
by Christin D. on 8/9/2019 9:42:00 AM
This edition of the Buyers Access® budgeting series takes a look at two of the largest recurring expenses a property realizes in monthly operations; waste disposal services and property painting requirements. Here we will review some of the most complicated issues faced by management companies within these two categories and explore solutions that Buyers Access® can offer access to from vendors within our strategic partnerships network.
About waste, recycling, and valet services
Waste services are not a glamorous, value added benefit that can be seen in day to day operations on a property by residents or prospects. On the other hand, we can guarantee that the waste services (or lack thereof) will be immediately noticed when it goes awry. Receptacle overflows, jammed compactors, nasty smells, and bulk items sitting at the curb take away from a property’s curb appeal, and make for some unhappy residents in no time. Nothing is worse than conducting a weekend leasing tour, and the trash receptacle areas create a detraction to the property. Waste and recycling services may seem like an easy thing to manage from a resident’s perspective, but the behind the scenes “plan” can be a bit more complex.
Waste service needs are unique from property to property. One asset can contain multiple contracts and invoices to process and monitor depending on things like: property location, vendor selection, equipment needs, local ordinances, bulk item disposal needs. and valet recycling and doorstep valet waste services. All-encompassing waste services are sometimes hard to find depending on vendor offerings in the area, requiring management teams to keep track of separate contracts for each of the services. Everything from the hauling of half empty containers to “contaminated” recycling bins that the recycling company can’t haul, causing extra charges and fees for additional services outside of traditional scopes defined.
Buyers Access® and Refuse Specialists work together to offer Buyers Access® members a simple solution to their waste disposal services. Refuse Specialists is a team of waste consultants who analyze, renegotiate, and monitor invoices for property management companies. Their services have no upfront costs, and the savings Refuse Specialists realizes is passed on to customers, saving them 20%-40% on waste expenses without sacrificing services.
Refuse Specialists - 4 Step Solution
- Refuse Specialists contacts each waste company you are currently contracted with and renegotiates the contract keeping it to a minimum of a 5-year term to avoid annual expense increases.
- A waste analysis is conducted on the current waste activities which includes evaluating equipment on site, haul frequencies, and other aspects of the waste health of a property.
- Once the contracts are negotiated based on the analysis of the current health, the contracts are delivered directly to the property management team to review and sign off on when appropriate.
- After execution of the contract(s), Refuse Specialists continues to monitor every invoice that is received for waste and related waste services, extra charges, fees, inefficiencies, and other inaccuracies, saving you time and money!
All about paint
Budgeting for recurring and non-recurring paint expenses
Paint frequently accounts for a large portion of a property budget. Buyers Access®, provides members a competitive advantage through access to national supplier partners; PPG and Sherwin Williams. Members have access to lower pricing, additional design resources, and industry leading expertise through account management by both Buyers Access® and the chosen paint supplier. Through the Buyers Access® program, properties can effectively create a practical strategy to manage all painted surfaces and lower prices, while increasing quality and useful life.
Matching Existing Paint
Paint can vary immensely and create many challenges for properties when it comes to painting surfaces on the interior or exterior of the buildings. Newer properties with freshly painted walls at construction may be difficult to touch up when that first resident moves out because of the commonality of primer not being used when the fresh surface was painted at construction. Paint touch up becomes challenging with varying sheen and primer practices. Paint types must be evaluated considering such things as type of property, average length of resident stay, and even geographical location. Working with the paint suppliers in our program and Buyers Access® simplifies the development of paint programs for a property/company and aids in streamlining paint operations.
Varying Surfaces and Paint Selection
Exterior paint surfaces are diverse and require various textures, qualities, and finishes in order to last on surfaces for the expected life of the paint project. For example, using the incorrect type of paint for a site-wide front door painting project could be detrimental if the paint easily chips when residents enter and exit their homes. Not only do these peeling doors create an eye-sore, they can also cost the property even more money than originally intended if they all must be re-painted due to the improper paint being used originally. Both PPG and Sherwin Williams have a complete exterior paint program that includes such things surveying the exterior needs and photo imaging services. Keeping the exterior of your buildings looking fresh is an investment that can help attract and keep your residents!
Another example of potential shortcomings involved with improper paint selection can come in the form of increased risk and liability. It is common for properties to treat stairs and pathways in and outside the structures with paint as a surface, especially on concrete stairs and pathways. If the concrete is a smooth surface and the paint used is not porous enough or durable enough to withstand being on the floor, the property has increased its exposure to slips, trips, and falls along with the paint possibly peeling in an unreasonably short about of time. This can potentially cost the property money and time directly through re-touches or re-done paint projects, as well as liability issues.
Our team can help
Partnering with Buyers Access® eases the budgeting and decision-making process in waste and paint expenses. Buyers Access has key supplier partners: Refuse Specialists, Sherwin Williams, and PPG, who can aid in the budgeting process for these larger recurring expense categories. Not only do members have access to a full member services department and account management department within Buyers Access®, but they also have additional resources from industry leading experts specializing in streamlining paint and waste activities for multi-family communities. Contact our sales department today at email@example.com to learn how we can help your team through a successful budget season. If you are a current Buyers Access® customer, reach out to your account manager for more information regarding the programs and how you can get started.
All About Ancillary Income - Budget Edition
by Christin D. on 7/5/2019 1:58:21 PM
Ancillary income, as it relates to multi-family housing, is revenue generated from necessities and value-added services offered to residents. This income category is designed to increase opportunities and can range in diversity across markets. Ancillary income should be accounted for when projecting budget numbers for the next fiscal period, typically year over year. Below we will take a closer look at the top sources of ancillary income often analyzed during budget season.
It is not uncommon for telecommunication services to be a part of ancillary income in multi-family communities. Opportunities for additional income can come from wireless internet, cable, or satellite services being billed back to resident for both common area and/or private usage. If a flat fee is charged based on occupancy for either value, it’s important to forecast occupancy and inflate the service cost by an average of 3% to adjust for inflation. Communities can also opt to bill back common area expenses realized through community televisions, internet services, and office operations. Once the total dollar amount adjusted for inflation for common area expenses is generated, divide the total by average projected occupancy in units to get the per unit projected income opportunity.
Laundry and Vending Services
Laundry and vending services also can create opportunity for additional income. Vending services commonly selected by multi-family properties are drink machines, snack machines, and machines that house healthy meal options. Laundry services commonly utilized are laundry rooms, dry cleaning services, and wash and fold services. Laundry rooms are typically in a centralized location and residents can access them outside regular business hours. This allows a longer time window for income to be generated and adds valued convenience to the residents.
Sub-metering services, otherwise known as “RUBS” income, is a service that will read water usage for each individual unit and report it to the water billing vendor, so it prints on the rent bill each month. Another aspect of this is an administrative billing fee for this reading and service to be done. In some cases, where submetering is not present, there is an occupancy and total building usage equation that can be used. It is important to understand which method is used prior to forecasting the budget. Utility increases are typically 3-5% year over year which can be obtained from local utility companies or your submetering billing provider.
Another source of utility income can be realized through rebate programs on energy savings energy saving rebates after completing an LED retrofit project on an asset. Utility billing companies can also cross reference current occupancy in comparison with generated utility charges for electricity. This will show if a resident has the electricity set up in the landlord’s name in which the charges would be billed back to the resident. On a vacant unit the property management company would assume this bill as it is in their possession. An additional fee for these bill-backs can be applied in many cases generating a bill-back fee and an actual submeter electricity expense.
Community Rental and Service Options
Properties may offer additional value-added services such as fitness-on-demand, personal training, and dog walking, to name a few. Another area of opportunity exists in the requirement of renter’s insurance and associated penalties for lapses in coverage. Parking can also generate additional income through options such as reserved parking, covered parking, or private garages. In addition, valet services, car washing services, and additional parking spaces can generate additional income for the property.
In addition to parking, storage is an income opportunity for communities who can accommodate designated storage areas. Storage closets can be rented out and incur additional monthly income for communities. This value-added benefit offers convenience to residents and opportunity to investors. The funds realized through storage income can be forecasted by analyzing historical storage unit occupancy and multiplying it by the monthly dollar amount charged per storage space. Adjust for inflation or any forecasted increase in storage fees charged on new leases and renewals for further accuracy.
Ancillary income categories should be reflected on the income portion of the budget and forecasted each year. Analyzing year-over-year income opportunities on storage, parking, along with utility trends can help draft an accurate budget. It is important to account for any potential service expense increases the property will incur for ancillary services. Accounting for these expenses helps quantify the profitability between ancillary income and expenses.
What areas of ancillary income are applicable to your community budget this year? Are there any you would like to add? Buyers Access® can connect members with service providers in these categories to help facilitate mutually beneficial partnerships while offering competitive pricing. Contact your account manager to learn how you can add ancillary income to your budget next year. Not a member yet? Contact firstname.lastname@example.org or call us at 1-800-445-9169 for information about how you can tap into the exclusive resources and opportunities so many existing Buyers Access® clients enjoy.
Budget Season is Upon Us!
by Christin D. on 6/11/2019 4:06:00 PM
The next few months in multi-family management will be the busiest time of the year for many properties. The summer months typically include an influx of residents and prospects searching for new homes, a higher number of expiring leases up for renewal, employees cycling through vacation time, increased HVAC maintenance calls, and its swimming pool season. Then, as soon as you catch your breath, the first draft of your budget is due. Whether this is your first budget or your 50th, proper preparation can make the experience and budget season a success. In this article, we will help to define and provide some tools to inspire your quest with this year’s budget season!
Unit by unit inspections
If you haven’t done so already, it is a great idea to conduct an annual or bi-annual unit-by-unit walk of your property. This is especially important for properties 10 years or older. Unit-by-unit walks can help teams plan for recurring capital replacements, renovation projects, and turn costs. For turnkey costs, click on the following highlighted words to link to our flooring and paint estimation tool for budget expense forecasting.
Collecting serial numbers and appliance information can also make life easier in many ways and is good information to have on hand. You never know when you will have that on-call emergency refrigerator or stove malfunction over a holiday weekend, and you will need to look up relevant information. Unit-by-unit inspections and inventories are great for preventative maintenance, forecasting turnkey expenses, planning large capital projects, and to identify any hazards that may not have been reported. You may even catch a few unauthorized pets or other lease violations in the process.
Pricing for vendor services
Contact current vendors and see if they are going to be keeping their rates the same or if rates will be changing in any way. The Buyers Access® Account Management team and Member Services departments can obtain the best possible pricing for all your products and help to make this a much easier process. Wouldn’t it be great to have an advocate that is constantly focused on bringing savings into your budget, and a higher NOI?
Completing unit-by-unit inspections along with an exterior and interior common area inspection is required when building your short term and long-term capital project plan. The Buyers Access® suite of services includes access to Bidders Access®, a comprehensive capital project bidding platform. For more about Bidders Access and how it can help you this budget season, please click on the following link www.biddersaccess.com, or speak with your Account Manager to get started right away.
Recurring operating expenses
Completing an audit of all contracts is also a helpful budget tool. Click on the following highlighted words to access a contract audit spreadsheet to use when conducting a contract audit. Budgeting the necessary amounts for contracts currently in place, and that will affect the upcoming budget season, is key to maintaining accuracy throughout the year on property financial statements and variance reports.
When drafting the Income portion of your budget, it is important to look at historical rental increases, fees, and other income categories. and how they have performed over the past 5 years as well as the past 12 months in detail. Pulling reports on market conditions from apartment data sites and analyzing historical and current market data will help to forecast income categories such as application, administration, and pet fees, to name a few. Also, pulling industry data for your area can help forecast projected rental increases for lease renewals and potential rent growth on turns. Historically, most properties typically see between 3-5% rental increases, but some may realize higher gains if in a high demand market, or if there are other factors such as a substantial rehab.
Other expenses and bids
Click on the following highlighted words to access a payroll expense spreadsheet, which is designed to aid in the calculation of the annual payroll expenses by a property, or by portfolio. Also included is a standard budget worksheet and a bid comparison form to aid in the overall planning of recurring and non-recurring operating and capital expenses.
The document library below is for anyone to use as a tool to aid in preparing for an annual property budget. For a full property spending analysis contact our team at 1-800-445-9169, or email Buyers Access® at email@example.com.
- Standard Budget Worksheet
- Summary of Contracts per Property
- Capital Replacement Worksheet
- Flooring per Apartment
- How Much Paint Do You Need Per Apartment
- Payroll Spreadsheet for Budgeting
- Bid Comparison Form
Are you ready for emergencies?
by Christin D. on 5/21/2019 11:23:00 AM
How prepared are you?
Inclement weather and other natural disasters are better braved with a plan and preparation rather than spur of the moment actions. The past several years has exhibited many challenges in the form of natural disasters for the multi-family management industry. This leaves us asking, “What are some things we can do today to better prepare for tomorrow?”.
The information below is designed to be a guideline, and a proactive approach to emergency response planning that can be taken now to prepare for an emergency later.
Step 1: Review your Property Risk Assessment
Multifamily apartment communities not only have risks associated with daily operations, but they also have larger potential emergency situations to prepare for. Both categories can be looked at in similar ways, but may be approached differently. Performing an emergency response risk assessment outside of your typical property risk assessment will help zero in on potentially larger catastrophic emergency situations. Some of these are:
- Along with all the side effects such as power loss, high wind damages, personal safety, etc.
At Buyers Access™, we recommend that management companies have a well-rounded understanding regarding their insurance companies’ expectations and coverage's when it comes to natural disasters and emergency response situations.
Step 2: Identify Region Specific Natural Hazards
If you are in a certain region of the country, chances are there are specific natural threats that your community faces. For example, if your property is in Miami, Florida, preparing for hurricanes, flooding, and heavy winds could reveal potential opportunities for risk elimination. Those in the northern part of the country may have blizzards and snow storms to worry about in the winter months. Keeping these ideas in mind, a higher focus on potential damage and liability involved with the specific risk condition can help your team gear up for potentially larger disasters.
Step 3: Update the Emergency Response Plan
The service team and community manager along with any other support teams/partners such as Buyers Access™, should walk the property to look for all specific risks, and document all potential risk factors. Contact Buyers Access™ and work with our team to develop a specific plan for any necessary supplies needed, such as generators, first aid supplies, storm shutters, etc. Make sure to always have plenty of drinking water available in case of loss of power or damaged plumbing. What other things should you think of to include in the plan?
Step 4: Draft or Update the Emergency Response Plan
When drafting the emergency response plan, below are a few questions to ask and points to consider making your plan as complete and comprehensive as possible.
- Alarms, where are they located and how will they be shut off
- Emergency call list- make sure this is always up to date
- Command Centers- where will everyone report to, and when?
- What is the communication plan to residents?
- What community resources are available for your team to use and what is their contact information?
- What are the evacuation routes?
- Ensure hazardous materials are safely stored.
- Identify areas of relocation.
- Have a list of vendor contacts easily accessible to save valuable time in case of an emergency.
- Know where your utility shut offs are! Mark a property map with utility shut offs and electrical points of importance for everyone to know.
- Review and include a copy of any corporate specific policies and procedures having to do with emergency response.
- Finally, review the above with your entire team and ensure everyone has access to and knows where this information is kept, and how it is accessed.
Time to act!
Now that we have covered some emergency response plan and natural disaster basics, it’s time to apply some of the points at your property with your team. If you are a supplier, ask yourself what you can do to ensure the properties you call on are prepared for emergencies? Buyers Access™ assists suppliers and multifamily properties in determining their needs and solutions every day nationwide. Some of the most prepared properties are those utilizing the extensive resources of supplier management and purchasing optimization that Buyers Access™ can provide. If you are interested in learning more about Buyers Access and how we can help you and your emergency response processes, contact our Ken Miller, VP of Sales for Buyers Access™ at firstname.lastname@example.org or by calling 864-630-8083.