Podcast Summary
Building a strong team for asset management in real estate: Effective communication, hiring qualified staff, and understanding asset management and operations are crucial for successful real estate investments. Forming a team with asset managers and property managers can help maximize potential and navigate shifting economic conditions.
Effective communication and building a strong team are crucial for successful asset management in real estate. Matt Faircloth and Andrew Cushman, experienced multifamily investors, emphasized the importance of forming a team with both asset managers and property managers. Asset managers focus on the big picture and setting the direction, while property managers handle the day-to-day operations. To build a profitable business, it's essential to communicate clearly with your team, ask the right questions, and find qualified staff. The economy's shifting conditions make it more important than ever to understand asset management and operations to maximize the potential of your real estate investments. Additionally, resources like Rent to Retirement offer opportunities to invest with little to no money down, helping you get started on the path to building wealth in real estate.
Collaboration in Multifamily Operations: Property vs Asset Management: Effective collaboration between property and asset management is crucial for multifamily operations. As portfolios grow, investors must bring on a team to help manage larger portfolios, streamlining banking with RelayFi's role-specific access and unlimited accounts.
Effective collaboration in multifamily operations requires both property management and asset management. While property managers handle the day-to-day tasks, asset managers focus on the big picture and strategic direction. As an investor, focusing on asset management becomes increasingly important as you scale and grow your portfolio. Most investors start managing their assets themselves but eventually need to bring on a team to help manage larger portfolios. RelayFi, a financial technology company, can help streamline the banking aspect of property management by offering role-specific access and unlimited accounts with one centralized login, making collaboration more efficient and reducing the need for multiple logins. With no monthly fees or minimums, it's a stress-free solution for multifamily investors.
Effective Operations and Asset Management in Real Estate: To succeed in real estate investing, focus on cash flow by managing Key Performance Indicators and well-run properties, as the easy profits from buying low and selling high dwindle.
While acquisitions have been the focus in real estate investing for the past decade, the importance of effective operations and asset management cannot be overlooked. The easy profits from buying low and selling high have started to dwindle, and investors will need to focus on cash flow to succeed in the future. This requires proper management of Key Performance Indicators (KPIs) and well-run properties. The analogy of a cruise director is fitting here, as the director sets the course and ensures the ship runs smoothly, while the passengers (investors) enjoy the ride. The last decade has seen a surge of inexperienced investors, but as the market shifts, understanding the fundamentals of real estate and focusing on operations will separate the successful investors from the rest.
Managing Multifamily Expenses and Maximizing Income: Self-management of multifamily properties can offer more control, but it requires significant time, effort, and skills. Deciding between self-management and outsourcing depends on factors like location, property size, and personal capabilities.
In multifamily real estate, managing expenses and maximizing income within the Net Operating Income (NOI) is crucial. Self-management can be an option, especially for smaller properties, but it requires significant time and effort. The decision to self-manage or hire a third party depends on factors like location, size of the property, and personal capabilities. While self-management can lead to more control and potential income, it also comes with high stress and low margins. The assumption that caring more equals competence is a myth, and it's essential to have the necessary skills to manage effectively. Ultimately, the choice between self-management and outsourcing depends on individual circumstances and priorities.
Choosing Between Property Management and Real Estate Investing: Consider individual goals and resources before deciding between property management and real estate investing. Research property management companies for strong backgrounds, expertise in asset class, and good fit for property size and type.
Property management and real estate investing are two separate businesses, and deciding which one to handle yourself requires careful consideration based on individual goals and resources. When it comes to finding a property management company, personal recommendations and thorough research are key. Look for companies with a strong background, specialized expertise in your asset class, and a good fit for the size and type of property you own or plan to buy. Remember, property management companies should bring a level of expertise and focus to manage your property effectively.
Choosing a property management company: Focus on market specialization and partnership: Consider regional companies for efficiency and accessibility, assess potential hires' skills, hire versatile staff for self-management, and prioritize collaborative partnerships
When selecting a property management company, it's important to consider their specialization in your market and the relationship they aim to build with you. Regional companies with a smaller footprint can offer both efficiency and accessibility. Additionally, the constant need for hiring in property management and asset management means assessing potential hires' skills and fit for the role. For self-managed properties, hiring a versatile maintenance technician or someone with a bookkeeping background can save costs and provide more control. Overall, prioritize a property management company that values a collaborative partnership.
Hiring for the right attitudes and culture in property management: Focus on hiring for attitude, cultural fit, and demeanor when building a property management team, as these qualities contribute to better resident experiences and long-term success.
When hiring for property management roles, it's essential to remember that different positions require different skill sets and responsibilities. A common mistake is expecting a property manager to handle asset management tasks as well. Hiring for attitude, cultural fit, and demeanor should be prioritized over skills and experience. These qualities are inherent and cannot be taught, while skills can be acquired through training. For instance, a maintenance person may not need extensive multifamily experience but should have a friendly demeanor and a desire to serve residents. Similarly, a leasing agent's primary role is to provide a positive and personal experience to potential residents, regardless of their technical knowledge. In essence, a successful property management team is built on a foundation of the right attitudes, culture, and demeanor, which ultimately leads to better resident experiences and long-term success.
People skills are key to success in real estate: Strong people skills lead to building trust and better returns in real estate, even in passive investment opportunities
Having strong people skills is crucial for success in real estate, especially when it comes to raising capital or managing properties. While technical skills like understanding cap rates or NOI are important, they pale in comparison to the impact of being able to make people feel good and build trust. As the speaker emphasized, successful people in real estate are not just those with information but those who can effectively communicate and connect with others. This is particularly relevant for those looking to invest in real estate without the hassle of managing properties themselves. Platforms like Vacasa, Connect Invest, and Pine Financial Group offer opportunities for passive real estate investing, allowing investors to earn income without the burden of tenant phone calls or maintenance issues. However, even in these passive investment opportunities, the ability to build relationships and trust can lead to more significant returns. Therefore, focusing on developing strong people skills can have an astronomically larger impact on the value of any real estate business.
Balancing Organization, Empathy, and Assertiveness in Property Management: Property managers need to be highly organized to manage tasks and deadlines, empathetic to connect with tenants, and assertive to enforce rules and collect rent.
A property manager should be highly organized, empathetic, and assertive. They must juggle numerous responsibilities, including handling tenant requests, managing finances, and maintaining property. Being organized is crucial for managing the various tasks and deadlines. Empathy allows property managers to connect with tenants and address their concerns, while assertiveness enables them to enforce rules and collect rent. A good property manager should be able to balance these traits effectively, acting as a supportive figure while also maintaining a professional demeanor. They must be responsive to tenant requests, even if they seem trivial, and be able to separate their personal feelings from their professional responsibilities. Ultimately, a successful property manager is a multifaceted individual who can handle the complexities of managing a property while maintaining positive relationships with tenants.
Balancing compassion and assertiveness in property management: Effective property managers inspire ownership and autonomy by treating properties and employees as if they belong to them, leading to better performance and trust.
Effective property management requires a balance between being compassionate and assertive. The best property managers can offer a hug and a hammer when needed. They should also build strong relationships with team members and treat the property as if it's their own. Encouraging a sense of ownership can lead to increased autonomy, better performance, and improved trust. By treating things as if they belong to us, we can inspire others to do the same and create a positive work environment. Additionally, recognizing and empowering employees to make decisions can lead to significant benefits for both parties. The story of Matt King, who went from being Dave Osborne's assistant to the CEO of Go Abundance, illustrates the power of taking ownership and showing respect.
Building a Strong Property Management Team: Effective property management requires a dedicated team with roles like property manager, leasing agent, maintenance supervisor, and delegator. A good leasing agent is financially motivated, charming, and a good closer, while a property manager can delegate tasks, prioritize work orders, and communicate effectively.
Effective property management requires a team of dedicated individuals with different roles and responsibilities. Intuition and engagement with residents are crucial, but as a property grows, adding a property manager, leasing agent, maintenance supervisor, and delegator becomes necessary. A good leasing agent should be financially motivated, charming, and a good closer, with incentives aligned to their performance. The property manager should be able to delegate tasks to grow and scale with the property. Additionally, a property manager who can prioritize work orders and effectively communicate with team members is essential. Ultimately, building a strong team is vital for successful property management.
Effective leasing agents use social media and follow-up to secure deals: Leasing agents who utilize social media, provide personalized attention, and follow up effectively can make a significant difference in securing deals for their properties.
Effective leasing agents are knowledgeable about their properties and enthusiastic in their communication with prospective tenants. They should be experts in their area and amenities, following up with leads, and closing deals. In today's digital age, an exceptional leasing agent goes above and beyond by utilizing social media platforms to showcase their properties and engage with potential tenants. For instance, a manager was able to secure leases through TikTok, demonstrating the power of social media in real estate. When tenants are making important decisions about where to live, a leasing agent's follow-up and persuasive abilities can be a game changer. Moreover, most people put significant effort into comparing amenities and prices when choosing a place to live. A leasing agent who goes the extra mile by providing reassurance and personalized attention can make a significant difference in a tenant's decision-making process. Overall, effective leasing agents combine expertise, enthusiasm, and creativity to make a lasting impact on their clients.
Effective communication and aligned team interests: Aligning asset manager and property manager interests through focusing on net operating income and setting incentives, and empowering maintenance supervisors to proactively address issues to prevent vacancies and save costs.
Effective communication and aligning team members' interests can significantly improve the success of a property. The speaker shared an experience of being impressed by a follow-up call from a business after a service, which made them feel valued and more likely to be a loyal customer. In the context of property management, the speaker emphasized the importance of an asset manager not only focusing on market rates but also considering the property's net operating income and setting incentives for property managers to exceed targets. This alignment of interests leads to a shared goal and increased motivation for the property manager to excel. Furthermore, maintenance supervisors play a crucial role in keeping residents satisfied and reducing vacancies. They should not only possess basic maintenance skills but also be eager to contribute and address issues proactively. By going above and beyond to help neighbors or address small issues without the need for a work order, they can foster goodwill and prevent potential vacancies. These actions ultimately save costs associated with vacancies and turnover.
The Importance of a Dedicated Maintenance Team: A dedicated maintenance team ensures timely completion of work orders, proper supply management, and effective handling of unexpected issues, leading to better property management.
Having a dedicated and engaged maintenance team is crucial for effective property management. This means having team members who are eager to contribute, take notes, and follow up on tasks without being asked. It also involves recognizing that maintenance is a team effort, and everyone plays a role in ensuring that supplies are ordered and work orders are completed in a timely manner. Furthermore, being on call and handling unexpected issues is a necessary part of the job, and a good maintenance technician will approach these situations with a sense of ownership and a commitment to serving the community. Finally, a strong maintenance team will also ask for help when needed and take responsibility for maintaining their work order flow. While it may be challenging to find and retain such team members, the benefits of having an engaged and dedicated maintenance team are significant.
The Importance of Finding and Keeping the Right Team Members in Maintenance Roles for Real Estate Investors: Finding reliable, hardworking team members with a good attitude is crucial for real estate investors, especially in maintenance roles. Hiring the wrong person can lead to turnover and additional costs. The current economic climate may make it challenging, but treating employees well is essential for retention.
Finding and retaining the right team members, specifically in maintenance roles, is a significant challenge for real estate investors, even for those at a larger scale. Ideal character traits include reliability, a strong work ethic, and a good attitude. Hiring the wrong person can lead to turnover and additional costs. The current economic climate may make it more difficult to find good employees, but treating them well once they're on board is crucial. Investors can find more information about Matt Fairclough at derosagroup.com or on Instagram, and about Kush Patel at vpacq.com or on BiggerPockets. Those interested in asset management and multifamily investing are encouraged to apply to work with their teams. The importance of having the right attitude and personality in the workplace cannot be overstated. As the market changes and becomes more competitive, finding and keeping a strong team is essential for long-term success.
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