Episode 76 - You need a Property Management Company that you can TRUST
/A professional property management company can make or break your profitability and overall success to your apartment investment. Find a management group you can trust. A property management company should treat their clients money as their own.
Craig Lashley & Todd Parks are with SIMC Property Management. SIMC is a third party property management company that manages over 7500 apartment units. SIMC focuses on properties with a minimum size of 200+ unit apartments. SIMC likes to find employees outside of the apartment industry to join their team.
Property Management companies should have a few different divisions.
Example: 1) accounting, 2) human resources, 3) construction & rehab
ACCOUNTING- is responsible for receiving rental income, paying the expenses and then delivering monthly financial statements to the ownership group. They are also responsible for lender communication for construction draws on rehab and the capital replacement reserves.
HUMAN RESOURCES- HR overseas the onsite property manager, assistant manager, leasing agent, maintenance manager, assistant manager & porter.
CONSTRUCTION- Your property management company needs to improve and update your property. They execute your vision. Having an internal construction group controlled by the property management company can be cheaper and more consistent than hiring an outside crew. A large property management company can buy in bulk and import fixtures, flooring and low flow toilets directly from overseas, thus saving huge costs.
TIPS: When you put a property under contract to buy, make sure that seller does not take their eye off the ball before the property changes hands. If occupancy or NOI fall, your lender may have to reduce your loan dollars. Maximize your rental revenue with LRO. Hotels and airlines use it to get the highest price in the market. Find out if you can use rental optimization for your building.
Huge amenity push in apartments to capture new tenants. Craig likes a ’24 hour-package room’ for boxes delivered by Amazon or UPS. Valet Trash is a great low cost amenity for tenants that will help your bottom line. Todd uses Facebook Messenger to communicate with potential tenants.
GOOD ADVICE: As an owner, don’t get in the middle between the management company and the on-site employee…or you could get fired. Let them do what they do (operate the building)…and you do what you do. (find the next building to purchase and raise the equity)
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