Property Management: Retaining Residents by Building a Sense of Community

Another fantastic article today from multihousingnews.com concerning resident retention. Along with going green, building a sense of community has almost become a cliche' or more to the fact, a populist movement. There is nothing wrong with this as on its face it is good to go green and it is good to build community. However, what do these mean? Going green is a little easier to define; cut back on water consumption, recycle, don't over-consumer, look for alternative energy sources, encourage green practices, etc. But what does building community look like? Could it be a film night at a community? Is it events or a friendly staff that drive community? Daniel Babka is president of California-based Rental Marketing Success and he says it is a lot of things.

"Resident retention involves promoting a sense of connectedness to one another, to the places and neighborhoods where we live. That means creating opportunities for shared experiences, helping residents grow roots by promoting social gatherings and other business networking opportunities, promoting events held on site that draw on common interests you have identified, offering renewal incentives like “Help with your Home or Home Office” (maintenance staff or independent contractor time doing things that wouldn’t normally be covered by a service request), assisting with shelving and closet organizer enhancements, monthly drawings and promotions, occasional weekend and after 5pm office hours."

We like the fact that it starts with simply promoting community. When was the last time you were at an event that had been hevaily promoted? Probably pretty good turn out right? Parties are a great way to promote community, film nights, friendly staff, etc.

A secondary reason for creating community is resident retention. The easiest money to maintain is the money you already have. There is a hard cost to finding more customers so why not work harder to retain the ones you already have? Not only can you build an opportunity for people to come together and be a part of something bigger than themselves, but you can also lessen your cash fluctuations and create more stability for your business. Sounds like a win-win to us.

Retaining Residents by Building a Sense of Community (multihousingnews.com)

Former condo site to get the latest luxury rental concept

Pretty quick and dirty articles today from all over...more posts coming.

A high-end rental concept already planned in four other major cities will find a home in the Westshore District, where building rental properties on infill sites has become a popular strategy. DMC Developers of Houston -- known locally for its off-campus student housing -- is planning to build a 379-unit luxury apartment project on 5.7 acres it purchased last October from the The Parkland Group for $12 million.

Development 'long overdue' (tampabaybizjournal.com)

Job Losses Cause Apartment Rent Growth to Decline to 0.8%

Continuing our theme this week of job loss and unemployment (seriously, is there anything more depressing to write about than that right now?) comes an article from multihousingnews.com further verifying the struggle between job loss and apartment vacancy. In explaining reasons for the falling rent numbers we posted a quote below from Ron Johnsey, President, AXIOMETRICS.

“One is that job growth is the primary driver for rent growth and we have had some big job losses in the last few months and the other is that there is a lot of unsold housing inventory which is causing home prices to fall and rents follow home prices down,” explains Johnsey.

The national vacancy rate increased by +0.7 % from a year ago to 6.5 % in 3Q08, which is the highest third quarter vacancy rate since +6.6 % in 3Q03.

Jobs, jobs, jobs. Credit and housing are huge pieces of the puzzle but we cannot forget that job growth and job advancement are big pieces as well. If our industry wants to move forward then we must continue to support job growth initiatives for the long-term survival of our businesses.

Job Losses Cause Apartment Rent Growth to Decline to 0.8% (multihousingnews.com)

U.S. Apartment Vacancies Rise on Concern Over Wages

We are continually fascinated with economic theory and discourse particularly as it pertains to the apartment industry. That's why when we were forwarded an article from Bloomberg News from our colleague Denise Hull, Publisher, West Palm Beach, we upon reading said article, sighed in the afterglow of economic bliss. That is not to say this article is full of good economic news. It is not. In fact, it points out a very real problem that will continue to plague the macro economy. Jobs, or lack thereof. The key to the article that pretty much sums up the vacancy rise is below:

"Twenty- to 30-year-olds are about 70 percent renters; they are a key driver for demand,'' said Chandan. `When they are not finding jobs, they are not renting either. They are more likely to move home with their parents.''

In the old economy (read 2 years ago) the thought of a massive slowdown in purchasing homes and condos was welcome news to the apartment industry for obvious reasons. Not so today as the promise of improved occupancies has not come with the slowdown in housing. We are learning, painfully, that the past has not been able to forecast this period. In the future, better economic tools must be required and more collaboration will be needed to better predict these periods.

U.S. Apartment Vacancies Rise on Concern Over Wages (Bloomberg News)

Tampa Bay Area Survey-o-Rama

Our crack research teams just completed market summaries, this time for the West Tampa area, Sarasota and Bradenton. The research was conducted by phone and information was provided via communities on-site staff between the dates of 9/22/08 - 9/26/08. A few results have been highlighted and are below, broken up by geographic area:

Bradenton
*Average occupancy for the area is 86%
*Average rent rates are between $691-$1309
*The most popular concession by far is 1-2 months free rent with a few 3 month free rents sprinkled here and there
*Traffic was reported as slow or steady for 80% of the respondents

West Tampa
*Average occupancy for the area is 90%
*Average rent rates are between $756-$1195
*89% of those surveyed were offering a concession
*A,B, and C product were all within 1% pt. of 90% occupancy

Sarasota
*Average occupancy for the area is 90.5%
*Average rent rates are between $791-$116
*A product had the lowest occupancy numbers coming in at an average 87% occupancy
*Traffic was reported all over the charts with some reporting slow, steady or an increase in traffic; this was more in flux than previously surveyed markets

Overall this information is neither new nor surprising. A 90% occupancy rate is what we have been seeing for a few months now, however the alarming trend is the drop in traffic rate. We will post an article tomorrow about traffic trends in this economy which reveal some surprises that had not been forecasted. Another alarming trend is the increase in months free as a concession. Earlier in the year 1 month free was standard with a few 2 month frees thrown in. However, over the past 3-4 months, that concession has upticked to 2 months free with a few 3 months free thrown around out in the street. This is a clear signal that things are getting worse and are not leveling out so that we can start seeing a light at the end of this tunnel. Right now, we think the best we could hope for is a stabilizing period followed by incremental growth.

If you should have any questions or if you would like the report in full, please e-mail aftampa@apartmentfinder.com or call us at 813-864-0275.