One question that we often receive from individuals who are looking to invest in a multifamily project is who manages the property on a day to day basis? The short answer to this is of course our property manger. However, understanding the specific roles that a property manger does and does not play during the life of a project is key if you want to execute your business plan to its highest potential.
When searching a given market for multifamily properties, the local property manger is a key ally on your team. Their knowledge of the local market often extends all the way down to specific properties and can be useful in your financial and general assessment of a given acquisition. It's also important to involve your property manger throughout the development of your business plan as you will want to make sure your plan is achievable and that you have buy in from the property manger who will be responsible for executing the business plan. Once a property is under contract, the property manger is one of the best candidates to assist with the due diligence phase of the acquisition. This is not only because they are likely familiar with problems that often arise on properties in a given market, but also because it gives them a chance to familiarize themselves with the property which can make transition easier for them after closing.
Once the property is closed on, the property manger will immediately begin transitioning the property to their systems and procedures. The difficulty of this task can range from easy to extremely difficult depending on a number of factors such as the condition of the property, types of tenants living there and the accuracy of the records that were kept by the previous property manger. The transition can be further complicated if a large rehab project is immediately started upon closing. Often times during a transition or heavy rehab phase of the project, the property manger will elect to have additional staff working on the property to meet the high level demands of work during this time.
During the entire ownership of the property, the property manger is responsible for the day to day tasks that go with running a multifamily business. This includes leasing, completing maintenance requests and dealing with any concerns that tenants may have or may cause. The activities, tasks and performance are carefully documented by the property manger and presented to the general partners both in the form of weekly meetings and monthly financial and operational statements which the general partners can use to assess the health of the property and make any changes necessary to the business plan or the tactics for achieving it.
How we work with our property mangers
At Apogee Capital, we see our property manger as a trusted partner on our team. Since they have an enormous amount of influence on how the property will be run and are in a very real way the face of the business we look to equip them with the tools and permissions they need to effectively do their job. Furthermore, we look to help them find solutions as a team when the property is faced with difficult challenges or decisions. Finally, as the asset mangers of the property, we work to hold our property mangers accountable for the work performed (or not performed). While this will ideally be minimal if you have chosen a good property manger, it is a key component to having a healthy well run multifamily business. As in all our business relationships, we work to foster a professional environment of respect and integrity in order to achieve the best for our residents and investors.
There are many important considerations when evaluating a multifamily deal and we make it our mission to careful vet each of these items. If you would like to learn more about passively investing in multifamily, please set up a meeting with us through our Calendly link and subscribe to our weekly blog here.