Multifamily Real Estate Asset Management Tips!

  • Share:

Optimizing Multifamily Asset Management with your hosts Ben Suttles and Feras Moussa!

VIDEO TRANSCRIPTION

00:00
money money money money money mondays
00:03
buddy you were betting really big on
00:06
that working and connecting instantly
00:08
but welcome to money Mondays I think we
00:10
are live so hopefully your life yeah of
00:13
course are we live everybody can you
00:15
hear us all right all right welcome back
00:18
everybody moneymondays here at the
00:19
disrupt TV studios with your hosts Ben
00:23
Suttles ferris Moussa hey don’t wait
00:25
good we need to vote who’s the favorite
00:28
host Hey I bowed for me salanio always
00:32
biased if I would take you out of the
00:33
film but I only had lunch we had a late
00:38
lunch
00:39
delicious right gotta gotta eat before
00:41
we do our money Mondays right gonna get
00:43
to keep the energy up now so now I’m
00:45
ready to take a nap drink the Starbucks
00:48
that’s why we get you a Starbucks buddy
00:50
exactly why I had the Starbucks so how’s
00:51
everyone doing so for those tuning in
00:54
for the first time right moneymondays we
00:55
do it every Monday 3:30 p.m. Central
00:57
some people submit questions beforehand
00:59
but really we like to take questions
01:00
live so don’t be scared don’t be nervous
01:03
we’re happy to you know we won’t mention
01:04
who says their questions feel free to go
01:06
ahead and leave a comment and we’ll
01:08
answer your questions live and anything
01:10
else to add today’s topics asset
01:12
management I’m gonna do a deep dive on
01:14
asset management we’ve done a thing or
01:17
two with asset management so those who
01:19
don’t know we have a company called
01:19
disrupt equity we have multiple
01:21
properties different markets and we’ve
01:23
had several exits yes so asset
01:25
management something that’s near and
01:26
dear to our heart because it is the
01:28
lifeline of your deals yeah I mean
01:31
without good asset management your
01:33
business plan will fall over and your
01:35
investors will hate you
01:37
yeah that’s where the rubber meets the
01:38
road right and it’s it’s not it’s not
01:40
all a cakewalk folks I mean I think one
01:42
thing that I always tell people that are
01:44
getting into this business and one of
01:45
syndicate deals is yeah the sexy part of
01:48
the business is the finding of deals and
01:50
raising the millions of dollars and
01:52
being a hero and you know closing the
01:54
deal app but really that day one when
01:56
you take over that property that’s when
01:57
the real work begins you thought it was
02:00
hard actually fun and a deal
02:01
raising the equity and getting into
02:03
closing that was that was actually the
02:05
the easier part of the process right
02:06
because now you have a business plan
02:09
that you have to execute on for your
02:10
investors or even if it’s just for
02:12
yourself and you’re buying your own
02:14
which we have people that we know that
02:15
do that right you still want a certain
02:17
level of return even for yourself so
02:20
that takes hard work and that hard work
02:22
that execution of your business plan
02:24
right and making sure that you’re
02:26
hitting your investors returns that is
02:28
asset management you are the conduit
02:30
between the property and the property
02:32
management company and your investors
02:35
yeah and maybe deep down a little more
02:36
right before you go on explain what
02:38
exactly an asset management does yep
02:40
right I mean I think there’s a lot of
02:41
confusion between the property manager
02:43
and the ownership what is the role of
02:45
asset management and who does it yeah so
02:48
you can designate so a lot of people
02:50
let’s take a step back you’ll have the
02:51
GP right which a lot of people are
02:52
familiar with right
02:54
what does DB stand for man general
02:55
partners I’m here guys I’m here to help
02:57
partners and then your investors are
02:59
usually gonna be your limited partners
03:00
now not everybody structured it this way
03:01
but just to keep it simple is to close
03:03
just say that’s how we structured it
03:04
right within that GP you might have you
03:08
know a KP a KP and then you might have a
03:11
manager or let’s call it two asset
03:14
managers that are actually gonna manage
03:15
the deal they’re literally signed off as
03:17
the managers for that LLC right so it’s
03:20
important to understand that there could
03:22
be a couple different GPS but not
03:24
everyone’s gonna be an asset manager so
03:26
let me make that distinction first right
03:27
but in the most simplistic definition of
03:31
it an asset manager is there to execute
03:33
on the business plan right that can mean
03:35
everything from working with the
03:37
property management company from hiring
03:39
and firing them if needed right to
03:42
working with the lender and all their
03:44
requirements to doing construction
03:46
management and all the rehab drawls to
03:47
managing the contractors and making sure
03:50
that your rehab plan gets executed to
03:52
investor relations and communications
03:55
right you’re the ones that are you know
03:56
drafting up the the weekly monthly
03:59
bimonthly reports and providing the
04:01
financial reports that you’re going to
04:03
get from your property management
04:04
company you have to you have to
04:05
disseminate those things you’re also
04:07
doing K once you’re working with your
04:09
CPA to make sure that the tax returns
04:11
get done and the K ones get to your
04:12
investors you’re also doing one-off
04:14
stuff like cost segregation studies and
04:16
tax protests and anything in between
04:19
that involves you know the property and
04:23
being able to be successful at managing
04:25
property right because your property
04:27
management company they can make
04:28
recommendations like hey it’s time to
04:31
you know do your tax protest but and
04:34
they can maybe even give you a person to
04:36
work with but they’re not necessarily
04:38
gonna sign off on that right that’s
04:40
where the asset manager comes in and
04:41
says okay this makes sense for this
04:43
property
04:43
I like this fee that this company’s
04:45
gonna charge I’m gonna go ahead and go
04:47
with it right so assume that everything
04:49
that’s important you know to the
04:51
execution that business plan that’s what
04:52
the asset manager does so they don’t do
04:55
much I do everything
04:58
it’s kind of the glue that holds it all
05:01
together yeah yeah so that’s kind of
05:04
what asset management is you know I
05:05
think you know people always kind of say
05:08
you know well where do you learn this
05:10
stuff right and I think you have to you
05:12
have to really kind of understand how
05:14
businesses work how teams work how
05:16
project management works you know we
05:18
always kind of say that we’re glorified
05:20
property managers yeah right so that’s
05:22
that’s an important thing to understand
05:23
that if you don’t know how you know big
05:26
complex projects work and how to keep
05:28
that ball moving in the right direction
05:29
you might have trouble right if you just
05:31
want to be the guy in the background
05:32
don’t really have to deal with anybody
05:34
right maybe just sign off on the loan or
05:37
maybe you just want to put your money to
05:38
work I don’t suggest you being an asset
05:40
manager because it does require you to
05:41
roll up your sleeves and get I mean we
05:43
live and breathe this stuff on a weekly
05:45
basis folks this is not something that
05:46
I’ll get to ask that management next
05:48
week know we every week we’re having
05:50
calls with our property management
05:52
company were fielding issues and
05:55
answering questions for our investors
05:56
you know and everything in between so
05:59
it’s a it’s a weekly thing it’s a
06:00
monthly thing it’s a yearly thing yeah
06:02
so let’s get going so talked about what
06:05
is asset management yep right so now I
06:07
was an asset manager right you’re
06:08
checking you know the gold asset manager
06:10
like Ben said you’re checking the
06:11
business plan and keeping it in line and
06:12
making sure you’re making the right
06:14
steps to get there right so to help with
06:17
that what are some of the maybe let’s
06:18
talk a little bit about what do we do
06:20
with asset management right how are we
06:21
structured on our you know then disrupt
06:23
equity and then I’ll thought about what
06:25
metrics are looking at track yeah yeah
06:26
that’s a so you know within within
06:29
disrupt equity you know Ferriss tends to
06:31
handle more the acquisition side of the
06:32
business I tend to handle more of the
06:34
asset management side you know that
06:35
doesn’t mean that I’m doing the
06:36
day-to-day we also have an in
06:39
asset managers names Neal Bertrand he’s
06:41
good guy you know in I work in close you
06:44
know contact with him on a weekly and a
06:47
daily basis to make sure that we’re
06:49
we’re executing our business plan we’re
06:51
working with the property management
06:52
companies right but some of the metrics
06:53
that me and Neal and Ferris are tracking
06:55
or kind of the you know the the same
06:58
stuff that you would think would be
06:59
important right you know making sure
07:00
that revenue is is staying stable or
07:03
going up right you know can we increase
07:05
rents or do we need to decrease rents
07:08
right you know maybe we’re in a
07:09
situation like we find ourselves now in
07:11
Kovan right and you want to keep
07:12
occupancy up you want to keep the right
07:14
tenants in place right
07:15
you might decrease rents nobody wants to
07:17
hear that but it’s it’s it’s one of
07:19
those things that’s driven by the
07:20
metrics and the data and the sub market
07:22
right you’re not always gonna have
07:23
control over this you might find
07:25
yourself in a situation like Cove in
07:27
where everybody is way below you are at
07:30
this point because they made it they
07:31
made an effort to decrease rents and
07:33
then you have to make that decision
07:34
right so rents revenue that’s important
07:37
keeping occupancy up obviously you want
07:39
to check that right you want to look at
07:41
your expenses right you know from not
07:43
only you know how are you in line with
07:45
what your what your rehab dollars are
07:46
going to spend and you know are you keep
07:48
it on track from the construction
07:50
standpoint but also just your
07:51
operational expenses right is that
07:53
something that you know you’re still
07:55
with staying within budget if not y-you
07:58
know the variance report that we see on
08:00
our financial statement is extremely
08:01
important and you know I would say that
08:04
and then you know just tracking
08:05
anomalies and the expenses on in general
08:07
right because expense control is
08:09
something that your property management
08:11
company how can I be politically correct
08:17
about the statement that’s not they’re
08:20
not very good at that let’s just put it
08:22
that way right they the good property
08:24
management companies tend to be good at
08:25
two things right
08:26
trying to keep occupancy up and trying
08:28
to drive rents right they’re looking at
08:30
the top-line right but as we all know
08:32
right you have your Noi and even below
08:34
that you have what’s the cash flow right
08:36
and you have to look at it holistically
08:38
and understand that expenses are a big
08:40
big you know factoring and making sure
08:43
the property is profitable so we look at
08:45
expenses quite a bit right so let me
08:48
pause you there so for those tuning in
08:50
right let’s maybe kind of go through
08:51
some calm
08:52
David how’s it going here a number one
08:54
Supporter so what’s our buddy you know I
08:56
think you’ve been on every one of these
08:57
so glad to see that Amir how’s it going
09:00
as well we haven’t seen you at our
09:01
meetup in a while so you know buddy
09:03
right how you doing man he’s um
09:05
you gotta come by our office sometime
09:06
and check it out you come see the studio
09:07
so you can warm a socially distancing
09:10
you know we’re being safe yeah
09:12
so let’s see so for those of you tuning
09:15
in right moneymondays every Monday 3:30
09:17
p.m. Central
09:18
you know we talk different topics this
09:20
week we’re talking about asset
09:21
management we’re happy to answer
09:23
questions live and you know go through
09:25
anything people want to talk about so
09:27
you know it doesn’t have your question
09:28
doesn’t have to be about asset
09:30
management right like I said like I
09:32
always say you can always ask Ben about
09:34
how he lost his hair one day someone
09:35
will laugh with that you’re gonna you
09:37
know we’re gonna friend we’re happy to
09:39
talk anything multifamily business
09:41
personal whatever being an entrepreneur
09:44
you know all right I’m here let’s do it
09:46
I’m here I pick a date man you like
09:47
maybe send it Sunday to send us an email
09:49
and let’s make it happen
09:51
yeah man let’s say definitely come on
09:53
buy a you know I mean it’s been one of
09:55
those things you you can’t I realize
09:56
that it’s been left out for months man
09:58
or yeah last meetup would have been
10:02
probably February did we do one March
10:05
with nothing done we did I think Anton
10:07
came down you know I think that’s one
10:09
that we do are just early brush you know
10:11
so it’s the last time so on a June we’re
10:13
almost four months out so you know I
10:16
know so what are some of the other
10:18
metrics man I know I can around let’s
10:20
see so lately with kovat we’ve been
10:22
talking about daily to try in a daily
10:23
deposit collections so we’ve been all
10:25
over that one just everyday seeing how
10:27
are we collecting how’s that going a
10:29
bank is a very important yeah another
10:31
one to that people kind of overlook is
10:32
really understanding turns your kind of
10:35
progress of turns out you mention that
10:36
one no I didn’t that’s a good yeah you
10:38
know cuz that’s that’s the one that
10:39
people like overlooked and next thing
10:41
you know the staff hasn’t turned
10:42
anything and now you don’t have any
10:43
product to rent and take three more
10:45
weeks to get that going so on that one I
10:47
definitely where you have to get a
10:48
general contractor experience that’s how
10:51
we know right yeah because you know
10:53
these things you kind of iterate over
10:54
time and so turns is a big one another
10:57
one two is just renewals right yeah
10:59
tough but that one no all right so he
11:00
did the surface I’m doing the next come
11:01
do the I’m talking about all the stuff
11:03
that we’ve had pain points on overtime
11:04
so renewals is enough
11:06
right understanding because again that’s
11:08
the what we call the back door problem
11:09
right here the front door and the back
11:10
to our front doors new clients the back
11:12
doors really people that are already
11:14
there renewing and it’s easier to keep
11:16
an existing customer than it is to get a
11:17
new customer and so make sure people are
11:20
happy there make sure people enjoy their
11:22
you know their their leasing with you
11:24
right yeah being you know tenant at your
11:25
property and helping get your attention
11:27
general right that’s important I think I
11:29
think especially right now folks like
11:31
you need to focus on that whether that
11:33
being not being as aggressive on your
11:35
renewals or just having a customer
11:37
service centric organization right
11:39
responding to workers I think is another
11:42
important thing how many workers do you
11:43
have open right how quickly are you
11:45
responding to work orders right or you
11:47
have 200 work orders and they’ve all
11:49
been open for you know three weeks
11:51
that’s a bad thing because that’s 200
11:53
tenants that are upset with you ya know
11:55
the Monday reports are important all
11:56
right a lot so those are what else are
11:58
you know I like to see kind of the what
12:02
week move ins are happening right and so
12:04
basically how is your how is your
12:06
occupancy changing week to week yeah
12:07
right because if you see that there’s a
12:08
lot of move outs coming and no move-ins
12:10
you’re gonna have a knack talking’s
12:11
problem yeah so how does how do you kind
12:13
of handle that and I also really my
12:15
favorite thing I should see is the last
12:17
couple of renewals at what price point
12:18
right that one because I want to see
12:20
that we’re getting new or rents right
12:22
and higher yeah kind of seeing what’s
12:24
happening there and so um
12:26
you’re over a year right you know month
12:28
over monotremes I’m talking about
12:29
weeklies so there’s also a set of
12:31
different set of metrics for me yeah
12:32
yeah I mean just essentially what you’re
12:34
least trained at is which is you know
12:35
from when they sign the lease to what
12:37
you’re now you know leasing it out at
12:39
like is there an increase there and
12:41
you’re hoping so right because a lot of
12:43
the people you’re probably taking off
12:44
the lease maybe it signed it even prior
12:46
to your takeover and you know or maybe
12:47
even not but it’s probably been at least
12:49
a year right maybe even eighteen months
12:52
and you know hopefully a lot of good
12:53
things have happened in the property and
12:55
you’re gonna want to see a delta there
12:56
right you’re gonna want to take it from
12:58
800 to 900 right so you can kind of
13:00
track that stuff on a weekly basis
13:02
that’s important right but yet turns
13:04
work orders because you have to that
13:06
that also goes back to the expense
13:08
control I think that that’s very very
13:09
important right
13:10
you know we track utilities very very
13:12
closely too because you know one thing
13:15
that property management companies won’t
13:16
do a great job of is you know really
13:19
digging into each and every line item
13:21
right you know and if you’re seeing a
13:23
spike in say electricity right you know
13:27
and maybe you can say it’s over right
13:29
now it’s attributable to co vid but
13:31
let’s just say Cove it wasn’t happening
13:33
right and you just saw a spike in March
13:36
and April for your electricity well what
13:37
would happen there right ask questions
13:39
right find out our lights staying on
13:41
during the day right is there is your
13:44
you know your turn crew and the your
13:46
maintenance people are they not turning
13:47
off the AC whenever they’re turning
13:49
units right maybe they’re keeping it 50
13:51
degrees for the two or three weeks if
13:53
they’re turning it right you need to ask
13:55
those questions because they’re property
13:56
management company they’re not going to
13:58
dive as deep as you as you as the asset
14:00
manager should so you have to understand
14:02
that but you know so we’ve got top do
14:06
you know what some of the top asset
14:07
management tips man what would you say
14:09
you know top asset management tips
14:12
before I answer that question let’s go
14:15
back to some of the calmus that came in
14:16
so I’m here yeah you were you were on
14:20
here a few weeks ago we were talking
14:21
about in person we haven’t seen you not
14:22
on money Monday so appreciate you hop it
14:25
on for those of you just tuning in right
14:28
moneymondays we do it every Monday happy
14:31
to basically talk through different
14:33
topics take questions live here on the
14:34
air I know some people I’ll send you the
14:36
questions beforehand we’ll go through
14:37
those
14:38
right so yeah I mean the one thing that
14:40
we want will come up with topics that we
14:43
think are important but we don’t know
14:45
what everybody thinks is important right
14:46
you know we want you guys to bring us
14:48
ideas to and we can talk anything being
14:50
an entrepreneur or business owner
14:52
investor multifamily real estate in
14:54
general I mean we could talk about a
14:56
myriad of topics right here so my hair
14:59
in this guy’s all right so your question
15:02
was what was it top asset management
15:05
tips top a samanda tips make sure you
15:08
get the weeklies the format that you
15:09
want them have the data points that you
15:11
care about actually check your weeklies
15:14
yes and actually look through them and
15:16
understand what’s happening and ask
15:18
questions right another one too is just
15:21
be diligent about the business plan if
15:23
were you trying to get to and where you
15:25
are right because you can’t kind of
15:27
sweep that on the rug otherwise you’re
15:28
you’re not gonna really make progress
15:29
right if you’re just kind of beating
15:30
around the bush trying to hide its
15:32
I need to be real it’s maybe the answer
15:35
and I think I think that’s it that’s a
15:36
good point right like you know on the
15:38
Investor Relations side like look not
15:40
everything goes perfectly you’re one
15:43
especially you know sometimes your rehab
15:45
takes longer your tenant profile was a
15:47
little a little bit worse than you
15:49
expected you had to have a little bit
15:50
more turnover than you expected right
15:52
things can slow down the implementation
15:54
of that business plan and I think you
15:56
just need you need to all obviously work
15:58
towards like okay how do I overcome that
16:00
challenge but also relaying that that
16:03
solution that you have with your with
16:05
your investors as well right because
16:07
remember we’re talking mainly about the
16:09
operational side but the other half of
16:11
being an asset manager is the Investor
16:12
Relations side and working with your
16:14
investors and doing that but fair spot
16:16
up a good point you know make sure that
16:18
you’re getting the right level data that
16:19
you need right and you can you and your
16:21
property management company can kind of
16:23
determine that but ultimately you know I
16:25
always kind of base it on what did you
16:26
propose to your investors right you know
16:28
those should be the basic metrics but
16:30
start there right you know make sure you
16:32
get a budget variance report – that’s
16:34
important because it’s gonna show what
16:36
your budget was that you had negotiated
16:38
with the property management company
16:39
which should hopefully mirror what you
16:40
gave to your investors and what is
16:42
actually happening in reality right and
16:44
make sure that they have you know the
16:46
right level of commentary beside that
16:48
right like not just some you know
16:50
utilities were high okay well that told
16:52
me what I already knew that of course
16:54
they’re high we already know that
16:55
why were they high right I want them to
16:58
try to dig in and think about what’s
16:59
going on right so a budget variance
17:01
report is another thing that I always
17:03
like to see right but I always say for
17:05
people always ask questions of your
17:08
property management company right you’re
17:10
entitled to ask questions and you should
17:11
not to the point of being annoying right
17:13
but you need to make them aware that you
17:16
are reviewing the data that they’re
17:17
putting in front of you because what
17:19
they’re going to start thinking is oh
17:20
been in Ferriss aren’t even looking at
17:22
this stuff so I can just you know you
17:25
know not do a great job at it right you
17:27
know I could yeah you want them to know
17:31
when I’m pounding on the door to get
17:32
answers yeah you know why did why was
17:34
this like this right you’ll it’s it’s
17:36
surprising how much of a fire that you
17:37
can light under them when they start
17:39
realizing that you’re just reviewing
17:40
their reports right you know but the
17:43
thing is just be candid with you know
17:45
both your property man
17:46
big company and your investors right if
17:47
the property management company’s not
17:49
doing a good job or they’re not hitting
17:50
the business plan right you need to be
17:52
candid with them don’t let that drag on
17:54
ask us how we know right you cannot let
17:56
them drop the ball even for a month
17:58
because it’ll take you six months to
17:59
back to get back to where you need to be
18:01
yeah right so fire quickly when it comes
18:03
to property management companies keep
18:05
them accountable to what your business
18:06
plan is and be candid with your
18:08
investors too right if things aren’t
18:09
going well it is what it is right you
18:12
know I mean investors probably don’t
18:14
want to know all the nitty gritty stuff
18:16
that you’re doing right but when things
18:17
are really bad you do need to tell them
18:19
what’s going on and be and
18:20
over-communicate right we usually do a
18:22
one once a month report now we’re doing
18:25
it twice a month right you know we’re
18:26
kind of given a mid month update and the
18:29
reason being is that times are crazy
18:31
right you know so we felt like we needed
18:33
to over communicate but we’ve seen some
18:35
people that done it on a weekly basis
18:36
right you know and we’re trying to kind
18:39
of have good enough data to do it on a
18:42
bi-monthly basis versus a weekly you
18:45
know it’s kind of hard to track some
18:46
things you know and get a sense of where
18:49
things are at over one-week period but
18:51
you know two weeks seems to be the about
18:52
the sweet spot so we’re going to keep
18:53
that up so I think that that’s another
18:55
tip for people to understand is that you
18:57
have to communicate especially in times
18:59
are tough right now you know so what
19:01
else we got man next question items for
19:04
you to increase the ROI on your
19:06
portfolio action items
19:08
so maybe simple things to increase their
19:10
ROI right look at what your actual loss
19:12
releases right understand how to close
19:14
that gap lost the lease what it means is
19:16
basically you know how much are if you
19:19
were to get new leases today on every
19:21
single unit and build those out how much
19:24
is that first is what you actually are
19:26
billing out today right and really what
19:27
you’re trying to look at is saying I
19:29
have people in this apartment that are
19:30
paying $700 but today I can write that
19:32
at 800 all that’s 100 on La Solis on
19:34
unit right so really understand that and
19:36
if you actually if your market rents to
19:38
our true marker rents meaning you’re
19:39
actually getting those well you know
19:41
that’s a good way to close the gap right
19:42
and just be aware of that and understand
19:44
when can you push one kanopolis yeah
19:46
although things to is just understanding
19:49
whenever if you’re doing rubs right what
19:51
you’re spread is and what your billing
19:52
back and you know are you able to
19:54
tighten that and do
19:55
right and again you know there’s rules
19:56
and laws they have to follow but that’s
19:58
a good example of another place that
19:59
people you know some property the
20:01
company will just get lazy and they do
20:02
fix billing and video other stuff right
20:04
and understanding that piece is another
20:07
good example
20:08
what other easy things that are always
20:10
kind of go back to two different things
20:12
right you know one on the income side
20:13
one on the expense side so on the income
20:15
side right is looking at your other
20:17
income right you know a lot of the deals
20:19
that we’re gonna buy now this might not
20:20
be you but we buy usually value-add
20:22
plays things that have either been
20:24
mismanaged or just aren’t in very good
20:26
shape right that that tends to mean that
20:29
the people that are living there and not
20:31
getting charged both the Full Tilt and
20:34
rent as well as the Full Tilt and the
20:36
other income right which can include a
20:38
myriad of different fees right from just
20:40
month-to-month fees to you know canceled
20:43
check fees to you know all kind pet fees
20:46
pet rent now right now you have to
20:49
obviously you know make sure that this
20:50
is all in line with what the sub market
20:52
is there’s a great service that one of
20:53
our friends had told us about Gregg what
20:56
was that pets that check pet yes
21:00
somebody was telling us about that kind
21:01
of helps really with some of that and
21:03
some that we want to roll out probably
21:05
next quarter but yeah I mean like tips
21:07
and tricks and tools like that to kind
21:08
of be a lot of people have dogs and pets
21:10
right you know I mean and they do create
21:13
a lot of problems especially when those
21:15
folks move out right you know your your
21:17
$250 deposit is not going to cover the
21:20
fact that that dog soiled the carpet
21:22
twelve different times right you know I
21:24
mean your carpet alone would have it
21:25
covered if he did it ten times maybe ten
21:28
but not twelve all right so just trust
21:30
me carpet alone it’s gonna cost you more
21:32
than two hundred fifty bucks yeah
21:34
so that is why you’re entitled to have a
21:36
pet deposit you’re entitled to have pet
21:37
rent right as long as it’s all in line
21:39
with your sub market and you’re not the
21:41
Trailblazer so that’s the income side
21:43
let’s talk about expense that one of the
21:45
lowest hanging fruit things that we’ve
21:47
kind of seen is tightening up on the
21:49
utilities we talked about we alluded to
21:51
some of that earlier right you know your
21:53
your vacant electric is sometimes
21:55
extremely high right why is that it’s
21:57
because your meatus guys are going in
21:59
there to turn the units and they’re
22:01
forgetting to turn off all the lights
22:02
it’s working yeah I’m good and then turn
22:04
the AC up when they leave at night so
22:06
the thing is running at 50 degrees
22:08
with all the lights on for the next week
22:10
or two while you’re well there turn into
22:11
the unit’s he times that by five ten
22:13
fifteen units you could imagine that all
22:15
gets billed back to the property right
22:17
doesn’t go to a tenant so pay attention
22:19
to that right also be looking at your
22:21
water bills right there’s gotta be some
22:23
times obviously rubbing it back you know
22:25
sometimes you’re not just depends right
22:27
but if the property is on the hook to
22:28
pay that water bill it’s in your best
22:30
interest to make sure there’s not any
22:32
leaks right if you can do any of the low
22:34
flow type you know implementation you
22:37
know from toilets to showerheads to
22:39
faucets look into that right see if
22:41
there’s a savings there right because
22:42
the utilities will chew up your property
22:45
you know worse than a lot of other
22:47
things let’s just put it that way starts
22:48
adding up right so something to kind of
22:51
take into consideration is those just a
22:53
lot of legal company out there yeah no
22:56
definitely it’s worth it because what
22:57
you know even if you cost you five grand
22:59
right if you’re if you’re overpaying by
23:01
five grand a month in utilities then
23:04
that just paid for itself so be smart
23:06
about it right I think also going into
23:08
the hot season here in Texas right doing
23:12
some preventative maintenance things on
23:13
your HVAC before you get into not see
23:15
yeah now you’re already too probably too
23:19
late yeah but you know doing it in the
23:21
in the spring right before it gets too
23:23
hot and if you have to buy some things
23:25
get ahead of it right because ultimately
23:27
HVAC people the HVAC parts those get
23:30
more expensive in the middle of summer
23:31
because guess what it’s supply and
23:32
demand folks you you you’re gonna pay
23:35
more when more people need something so
23:37
if you can stock up on it ahead of time
23:38
then you’re in good shape right same
23:40
thing goes with the flip side of it
23:41
right if you’re in the winter you need
23:43
to get furnaces buy that in the summer
23:44
right so the utilities are huge right
23:46
and you know something you think about
23:47
it for sure alright so for those of you
23:50
tuning in money Mondays we do it every
23:52
Monday 3:30 p.m. Central
23:53
we the goal is really just talking about
23:56
different topics this week we’re talking
23:57
to asset management yeah and going
23:59
through them live so you know people
24:01
have questions feel free and leave your
24:02
questions were happy to answer them live
24:03
and share their food could show the
24:05
what’s on the screen here you know so
24:08
and if you could move the box down I
24:11
want to show this one thing here so the
24:15
graph on the right was one of our you
24:18
know we won’t name any names but those
24:19
are one of our Atlanta properties
24:22
that we’re really really excited about
24:23
you know during co vid our property
24:25
management company was able to actually
24:28
I’m gonna I’m gonna say our on-site
24:30
manager he’s done he’s done a lot of the
24:31
heavy lifting you know through the
24:34
pandemic and not having an office open
24:35
he is increased occupancy from 85 to 95
24:40
this is on a deal that was basically non
24:42
stabilized lease up so yeah it was
24:44
probably 80 to 90 well it’s now it’s 95
24:47
yeah but and then you know he’s taken
24:50
you know he’s taking our rents from you
24:52
know whatever 100 or so up to a hundred
24:56
and I think we’re gonna close that 130
24:57
or billing out yeah we’re building out
25:00
more collecting starts just collecting
25:02
right so remember collections is just
25:03
the cash in the bank that month right
25:05
but some people might pay for the rent
25:07
prior to that and that’s gonna be rolled
25:08
up in the financials so like been here
25:10
he’s good at issues he pays his friends
25:11
you know 1 year in advance
25:14
you know only six months in advance all
25:17
right so no but we wanted and this is
25:19
what we’re tracking though folks like we
25:20
did we put this graph together you know
25:23
Neil is tracking this on a daily basis
25:25
right what is actually in the bank and
25:27
we’ve been rolling this out to our
25:29
investors they seem to like the data
25:30
right because then they can kind of see
25:31
trends right it’s all about trends and
25:34
what is the data telling you and then
25:35
making informed decisions from there
25:37
right but we wonder we wanted to you
25:39
know say little kudos to our deal in
25:41
Atlanta because even through Co but it’s
25:43
been doing really really well and and
25:45
and all of our properties are within
25:46
about 5 percent of where they were among
25:49
so far so far yes we’ve been you know as
25:52
a team we’ve we’ve done a lot to kind of
25:54
help ensure that right so that’s the
25:56
good news but I’m curious to see what
25:58
happens in post stimulus so come on keep
26:02
your fingers crossed we need that
26:03
unemployment money well let’s go through
26:07
some questions I know we’re you know
26:08
we’re gonna wrap up soon so make oh this
26:10
report so these are the questions that
26:11
we got earlier on obviously people
26:13
submitted so we’ll go through those if
26:15
anyone has any questions feel free to
26:16
dump them we’re happy to talk to them
26:17
yeah first one you have any tools or
26:19
systems you use to hold your asset
26:21
manager accountable owch owch
26:25
I think that the numbers speak for
26:27
themselves right you know I mean some
26:29
things you know is not going to
26:30
necessarily be the asset managers fault
26:32
some things they should be tracking more
26:33
closely some things they need to adjust
26:35
on right you know but the numbers don’t
26:37
lie right and I think you know as long
26:39
as you as an investor or you as it may
26:41
be another partner on the deal you know
26:43
understand the metrics and how they work
26:45
and what is the level of success that
26:47
you’re looking for you can easily say
26:49
hey we’re supposed to be at 90 percent
26:51
it’s really ultimately it’s reporting is
26:53
you know what data points do you care
26:56
and is that manager tracking them and as
26:58
you’re reporting them yeah right
27:00
absolutely
27:00
you can’t tell if you’re gonna perform
27:02
if you’re not tracking them or reporting
27:03
them this is kind of fundamental and
27:05
then working through that right so
27:06
that’s probably that we use the sauna
27:08
internally that helps them a lot of that
27:10
that helps keep both their asset manager
27:12
a property manager or on-site staff
27:14
keeps everyone accountable yep right he
27:16
helps keep it ever organized doesn’t to
27:19
be the main things right we do have a
27:20
four-hour in-house manager we do have bi
27:23
dashboard which is really powerful yep
27:25
and so that’s another tool that
27:26
basically gives us really nice visuals
27:28
around you know how the properties are
27:30
performing in many different aspects
27:32
that’s real-time data you know
27:33
presenting graphs and so it allows you
27:36
to kind of you know not even have to
27:38
wait until you get the monthly
27:39
financials or not even wait until you
27:41
have to get the Monday morning report
27:42
right which is not gonna be as an
27:43
inclusive as say the the the monthly
27:46
financial report so it’s pretty good so
27:48
our buddy Jeff greenberg came on so
27:50
laughs what’s up man he’s waiting to we
27:52
see we were all waiting to see what
27:53
happens during when the seamless dries
27:55
up yeah we are hopefully it’s all roses
27:57
but we’ll see what happens so we’ll see
27:59
hope you’re doing well Jeff you know I
28:01
think your state’s doing a lot better
28:02
than our state lately well we’ll see
28:05
hopefully a toss up I don’t know yeah it
28:07
just depends on the day of the week you
28:09
know we miss your buddy
28:11
hope you’re doing well yeah so let’s see
28:13
and we’ll some said great pointers
28:15
Thanks some happy to UM let’s get going
28:19
then so what skills make a good asset
28:20
manager
28:21
I think being organized I’ll say
28:22
actually I like to assess one kind of to
28:24
me the the things that make a good asset
28:27
manager are being organized
28:31
hey I said that yeah being more
28:34
organized than been and saying being
28:35
organized now being organizes one
28:38
right understanding the mechanics of how
28:39
the business works yeah right and being
28:42
kind of data-driven right understanding
28:44
data gathering data and what it tells
28:46
right those three things I think making
28:48
are critical to to being in a good asset
28:51
management right and if you were to pick
28:52
two of the three I mean I would actually
28:54
say it’s knowing the mechanics of the
28:55
business so that could be taught but
28:57
some of the other skills are less
28:58
teachable so those are three really
28:59
powerful thing I think that make a good
29:01
asset manager if you’re looking for one
29:02
you want to look for kind of a mix of
29:04
those things yeah you got it you’ve got
29:05
to be able comfortable around a
29:07
spreadsheet crunching numbers you know
29:09
what does that look like you know if you
29:11
don’t it’s probably gonna be a tough gig
29:13
right because you know once again you’re
29:15
you’re you’re basing decisions on where
29:18
the data is right so you have to you
29:20
have to have that as a skill set yeah
29:21
all right let’s keep going and then the
29:23
last question one of the weekly daily
29:25
tasks you may perform as an asset
29:26
manager okay we want to do the you want
29:30
to do the weekly and I’ll do the monthly
29:31
and I guess daily weekly data I’ll talk
29:34
about monthlies yeah yeah so daily right
29:36
you know me right now we’re tracking
29:38
collections right we’re handling the
29:40
rehab you know all this stuff is ongoing
29:43
I just always can just say it’s gonna be
29:45
one of those things this could be
29:46
professionally happening even after
29:48
you’re done with the rehab you’re still
29:49
gonna have capex right so that’s
29:50
probably a daily thing weekly thing
29:52
you’re reviewing the Monday morning
29:54
reports right which are the reports that
29:56
you’re getting from your property
29:57
management company right it’s not gonna
29:58
be as intense or as detailed as the
30:01
monthly reports but it’s still gonna
30:02
have the data that you’re needing to
30:04
track you know and then you’re also
30:06
having phone calls with them right I
30:07
would encourage you at least through the
30:09
first year or two of Olding onto a
30:11
property that you have weekly calls even
30:13
if it’s a 20 or 30 minute sync with your
30:15
property management company you need to
30:16
be talking to them you need to be asking
30:18
them questions and it’s usually gonna be
30:19
questions based on the month in the
30:20
Monday morning report yeah then maybe in
30:23
terms of monthly stats you’re looking
30:24
over the financials right how are you
30:26
tracking relative to the budget what’s
30:28
that variance report look like you know
30:30
is money are there opportunities to save
30:32
right even if you’re performing is there
30:33
a way to perform better right or is
30:35
there a way to collect more that’s kind
30:37
of those are the key things you’re doing
30:38
lender draws right whenever you’re in
30:40
the midst of rehab quarterly you’re
30:42
usually doing replacement reserve wrong
30:43
yeah and what else kind of other things
30:47
you know reporting out to your investors
30:48
doing distributions that’s the big part
30:50
of it as well
30:52
that’s really the gist of it right yes
30:56
you know that we talked about right
30:58
counting you know if you need to write
31:00
there’s kind of some of that stuff so
31:01
that’s that’s the high level I’d say
31:03
most of what’s needed no no I mean I
31:07
would say on the monthly and the daily
31:09
you know in the weekly that’s probably
31:10
about what it is right you know but
31:13
there’s gonna be stuff that pops up in
31:14
between right you know maybe you have a
31:16
fire at the property now you’re having
31:17
to deal with an insurance clause yeah
31:18
right you know so there’s some things
31:20
that you’re just not even gonna know
31:21
that you’re gonna have to do right it’s
31:23
just gonna pop up on top of all the
31:25
other things he’s gonna do absolutely so
31:26
so Jefferson asks what KPIs are you
31:29
watching on a weekly basis from the
31:31
asset manager because I think we want
31:33
some of those earlier but really I guess
31:35
really I guess that’s question we talked
31:36
about the KPI from the property manager
31:39
but from the asset manager you want to
31:40
kind of maybe give a rundown of those so
31:43
KPIs of what I’m looking for from it is
31:46
yeah you’re tracking from asset manager
31:48
maybe I’ll hear all stars so today I
31:50
mean you know how are we doing on
31:52
collections right where are we with
31:54
drawls cuz trawls can be all over the
31:56
place so really weekly how we’re
31:57
trending when’s the last time we’ve
31:59
heard from the lender right and I guess
32:01
this is probably where you were going
32:03
Ben there’s a lot of overlap the p.m.
32:05
and the asset managers but really to
32:07
make good informed decisions what data
32:09
do you need to on a property – it’s a
32:12
reason about it it’s looking at the last
32:14
leases right how are those how are those
32:16
going looking at obviously collections
32:18
looking at you know how much traffic is
32:21
coming in how much traffic you’re
32:22
closing how many units are getting
32:24
turned how many people are renewing even
32:29
other things like other interesting
32:30
things that they’ve kind of come across
32:31
is really you know if you’re on site go
32:33
look at the last set of moving kind of
32:36
sheets from your tenants so you can see
32:38
our tenants moving into a unit that is
32:40
rent ready or are there some there’s a
32:43
lot of these kind of notice was did they
32:47
get moved into a unit that wasn’t ready
32:49
and and starts out relationship off on
32:52
the wrong foot I think also just kind of
32:54
you know keeping up with the reviews –
32:55
of the property right you know cuz that
32:57
sometimes can be a telltale sign of how
32:58
the property management company is doing
32:59
but yeah I mean your asset manager
33:02
really is your your mate you’re relying
33:04
on
33:05
them to provide you with the data that
33:07
you need right and if they’re not
33:08
providing it then that’s a bad thing
33:09
right
33:10
you know keeping organized keeping
33:12
communication channel going and then you
33:13
know obviously keeping up with the
33:14
drawers it’s all it’s all part of what
33:16
you have to do as an asset manager right
33:18
yeah so for those tuning in moneymondays
33:21
we’re about to call it a wrap this week
33:24
we talked about an amendment and so if
33:27
you have any more questions please feel
33:28
free to try them you know drop them in
33:29
we’ll go ahead and answer them here live
33:30
but if not we’re gonna call it a wrap
33:33
here in a minute so don’t worry boys
33:35
yeah going twice
33:37
wait Ben now I’m getting all right
33:40
anyone else
33:41
all right well cruciate you guys tuning
33:44
in no problem Jefferson you’re welcome
33:46
thank you all for watching and yeah we
33:49
walk around yeah next Monday
33:53
[Music]

Leave a Reply

Your email address will not be published.