When acquiring an apartment community, it's important that the management company has advance knowledge of any issues at that property that may be causing it to underperform. After all, buying a community that's in need of better marketing, management, or leasing, increases the potential for future financial gain.
In a previous blog post, we offered recommendations for how property management companies should evaluate the marketing of a possible apartment acquisition. In this blog, we're shifting the focus to how to evaluate the leasing and management of a property and discover if there are any problems that need to be addressed after acquiring it.
Video: How To Evaluate The Leasing Of A Possible Apartment Acquisition
Mystery Shop The Apartments Yourself
The most effective way to see how an apartment community handles the leasing process is to go through it as if you were a prospective resident yourself. There's three tactics we'd recommend you try:
1. Call The Leasing Office
This gives you a chance to evaluate how leasing agents at that community perform during phone calls. As these conversations are typically held with highly qualified leads, it's vital that these calls are executed successfully by the leasing staff.
Is your call answered promptly, if at all? Is there a way to easily leave your contact information should no one answer?
It's also smart to time the length of the call, too. If the conversation lasts less than a minute, then it's probably because the leasing agent failed to take the time to gather your contact information, establish urgency, or set an in-person showing.
2. Take An In-Person Tour
This next step lets you evaluate how leasing agents perform during tours by experiencing one yourself. You can judge their etiquette, communication, and selling ability.
Additionally, you can see how that community approaches in-person showings in general. Do they show occupied, modeled, and/or vacant units? Are those units properly turned over by the maintenance staff before the showing?
3. See How An Agent Follows-Up After A Tour
This will help you assess whether or not the leasing agents at that apartment community are trained to close.
After taking an in-person tour, the agent you interacted with should maintain communication with you and see where you're at in your apartment search, and if they could be of any assistance.
If the agent follows-up with you via email, it'd be ideal that they include links to the floorplan page or photos and videos of the unit you toured so that it could be shared with secondary stakeholders.
Gain Valuable Insight On Management
Go a step further while mystery shopping the apartments. Take the time to review the condition of the units, amenities, grounds, and overall appearance of the property during your in-person tour. This can give you valuable insight of the existing management at that community.
One particular thing to look out for are signs of deferred maintenance, or areas where there are obvious maintenance issues that haven't been addressed that your property management company would be responsible for fixing after acquiring the community.
It's also worth checking whether or not that community is staffed appropriately, too. This is because some properties could have more employees than necessary working on-site in the clubhouse, while others may have individuals handling multiple roles like managing, leasing, and bookkeeping. This can be helpful for understanding whether or not the staff has the capacity to do what is required of them in their roles.
This should include the count of maintenance personnel as well. Are there enough to address both the size and age of the property? Older properties with a high number of units should have more maintenance staffers than newer properties with less units.
The goal with evaluating the leasing performance and management of a potential acquisition is to discover the issues your property management company will need to address after acquiring that apartment community. Awareness is key to swiftly turning things around in your favor.
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