Superior Property Management: What Should It Look Like, How to Evaluate Current Performance, What to Look for If You Are in The Market for A Change?

The significance and importance of "Superior Property Management" is a discipline of real estate that rarely gets the attention and focus that it truly deserves.

My consultancy is all about advocating for and maximizing the value that only "Superior Property Management" can achieve. There are many excellent practitioners in our industry that not only perform at a high level daily in managing your asset but are always striving to better their internal organizational processes, response time and customer/employee satisfaction levels.

Always be mindful that a successful management company does not remain stagnant in how it conducts its business and relates to its customers and clients.

Our business is ever changing, (COVID certainly changed how we rent our apartments!)  Continuing laser focus on your asset that addresses the key components that drive your business plan, (yes... a business plan!) is the critical path for success.

Management companies are hired to maximize the value of your asset. Sounds wonderful, right? 

These are great "buzz words" to hear, but what exactly does this mean? How does an owner truly evaluate if they are currently employing, or about to hire, a " Superior Management Company? 

Is there a handbook or formula to help make this determination? Sorry to say, there is no easy answer to the most important decision that a multi-family owner will make. You will need to do some homework and learn about how professional property management organizations perform their craft. What you will learn will be beneficial as you proceed to a decision and a new and important business relationship. This decision will not only impact your bottom line, but your property or portfolio reputation as well.

There are many characteristics you want to see in a management company such as Steadiness, Proactive Management, Communicative, Flexible, Caring, and strong focus on Customer Experience. They also must have a People First Approach as well as a strong Reputation Management program.

There are plenty of questions that you should be asking that probably are not covered in the pitch presentation. Let's briefly discuss the new business pitch/presentation and then explore key questions and observations that you should be thinking about.

NEW BUSINESS PITCH/PRESENTATION

Regardless of the size and unit count of the competing management organizations, you will receive an impressive presentation from senior executives and sales team that will feature an engaging PowerPoint presentation and be wowed by the array of best-in-class software, leasing and CRM programs, attractive and customizable financial packages, employee development programs.

In some cases, you may have the owner or principal be part of the presentation. You will hear why the presenting management company, is simply better than everyone else. Better people, systems, processes, financial packages, you get the picture. If you are talking to a large organization, more resources and bigger is best. If you are talking to a smaller organization, more intimate, nimble, and able to make decisions and pivot quickly. It all sounds good and is reassuring to know that all bases are covered, and a professional team is ready to take on your asset.

If you are selecting a new management company, you will most probably have several excellent choices to consider. Always make sure that you are not only weighing what the new company has to offer, but how your organization operates and communicates, as well as your own expectations and commitment to excellence. Who will blend best with your organization?

SUGGESTED QUESTIONS AND CONSIDERATIONS FOR BOTH THE SELECTION OF NEW MANAGEMENT COMPANY AND BETTER UNDERSTANDING OF EXISTING MANAGEMENT COMPANY

• Will you ever see or interact with any of the presenting team after the contract is awarded?

• Based on the size of your property or portfolio, do you believe you will have the leverage to get the attention when you need it?

• What is the quality/experience level of the Vice President/Regional Manager that will be assigned to your property, or portfolio? Can you meet them? Who will be the primary point of contact that drives results?

• How is the management company focused on providing an "Excellent Customer Experience"? How does the management company research and select new best in class software for greater efficiency?

• Are Key Performance Indicators used in evaluation of property performance?

• Are there weekly/monthly meetings on operational issues, progress reports, financials, and leasing/marketing? Are notes taken and distributed?

• What is the frequency that your property/asset be visited? Is there a formal inspection process?

• What reports are included in the monthly financial review? What is the internal monthly financial review process before the owner is presented the finalized financial package?

• Understand the "Company Culture.”

• Is Management Company willing to take on challenging assignments and not just trophy deals? How involved is ownership/senior management, do you feel the owner is strongly aligned with the success of fee management properties and genuinely wants your business?

• Discuss the role of the Marketing group and how they get up to speed on marketplace competition, sales/lead tracking?

• Ask about Mechanical expertise/preventive maintenance/capital improvements.

• Understand the reputation of Management Company, ask around: brokers, social media. You are looking for overall commitment to excellence and reputation.

• How is social media, brand awareness and reputation management addressed in your organization?

• Ask what makes your property unique and how it will be positioned and presented to the rental prospect in the marketplace?

THE MOST IMPORTANT ASSET: PEOPLE

 So much to evaluate and understand. People are the key to your success! Areas to explore include:

• Understand the hiring, training, and development process.

• Is there a proactive performance evaluation process?

• How are people managed, motivated, and appreciated?

• Ask to hear success stories.

• Understand Bonus Plan

In closing, the art and science of "Superior Property Management" comprises many moving parts. The industry is a continuing and evolving business that blends new technologies and products, with basic management and respect of people, marketplace, and customer service.

Experience, common sense and "commitment from the top of an organization" do matter.  A company that is always looking forward to better itself should be at the top of your list. Consider who will best represent your financial and professional interests, who will be proactive in the goal of maximizing your bottom line, and who will be most responsive and communicative to its customers, and clients.

Hopefully, I have provided positive "food for thought" for both ownership and management in helping set the foundation for expectations and performance for truly maximizing the value of a real estate asset.

"Superior Property Management" enhances financial performance, customer satisfaction, and property reputation. Please feel free to reach out to discuss how best I may help you achieve your professional and financial goals for your asset and working with both ownership and management companies to ensure alignment of interests and success for all parties.

 - Jeff