The Road to Property Management Success
Property Management can be very profitable — just ask Sperry Van Ness / First Guardian Group. The San Jose, California firm recently announced the successful close of escrow on University Fountains, a student housing complex that sold for $34 million. Receiving several offers, the property saw substantial demand and competition among buyers.
SVN/FGG undertook the property management over an 18-month period before beginning to market the Class “A” property. Under SVN/FGG’s management during the current school year, the property occupancy increased by 15% — crushing other years in comparison. SVN/FGG set aggressive weekly leasing goals which compared improvements in occupancy and income against all other competitive properties in the submarket. The leasing team was given incentives based on their progress in moving the performance of the property ahead of all other comparable assets. The hard work of SVN/FGG Advisors produced returns of over 100% of the original equity.
So how did they do it? Proactive asset management and collaborative marketing efforts can get the job done.
Proactive Asset Management
- Established aggressive weekly leasing goals to continually improve occupancy
- Strong incentives for moving property performance ahead of all comparable properties in the submarket
- Annual competitive re-bidding of all significant ongoing services (landscaping, garbage, pool maintenance, etc.)
- Monthly owner conference calls
- Detailed monthly variance reports including cost ratio comparisons to similar properties
Collaborative Marketing Efforts
- All Brokers received marketing materials from day one, which included SVN’s statement “50% of the commission 100% of the time”
- All Brokers requesting access to the property data vault were personally contacted and encouraged to provide a bid
- All Brokers were treated with the same respect and courtesy regardless of affiliation
- All questions and inquiries were answered 90% same-day
- SVN/FGG participated in all property tours with Brokers
Following these guidelines which emphasize competitive and collaborative practices can lead to property management success. So take a cue from SVN/FGG and collaborate with your team members to achieve a profitable property management turnaround.
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