"Rubs"  Ratio Utility Billing system

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We have been exploring new ways to increase revenue at our apartment complexes. 90% of our tenants are well below market value on rents. Obviously, we are looking at raising rents but we are also looking at "Rubs" Ratio Utility Billing system as an alternativ e. Most of our cost are from our monthly utilities so if we can cover that we would get oursleves in a much better postition. However, I'm not finding much info about "Rubs" except for all the companies I could hire to implement this program. I'm looking for any advice from someone with knowledge on the subject.

#Garrett Honea I’m in a similar spot on a property that we have pushed rents to market but want to find some additional revenue. So for that reason I’m interested to see responses to your post and would love to know what you learn. Happy Investing

First, before implementing RUBS make sure your market supports it. What I mean is you don't want to bring all your rents up to market and transfer over to RUBS and have everyone else not charging tenants for utilities.  So check other listings and see if utilities are included. If you have already done this then contact your utility provider and they should be able to give you some info on it.

All it does is split the cost between the units based on SF.

As @Michael Badin mentioned, make sure your comps are doing it too or that your rents are below theirs if you plan to do it so the overall costs to the tenants are similar. Also you should consider your tenant demographic. The lower end demographic like to know what their monthly expenses are and having variable utilities is a negative to them. So staying all bills paid could be a bonus to your property. Also, some cities/states you can't do RUBS if your property is newer. If it is built after a certain year they require that you put in individual meters instead.

Thank you for your thoughts everyone. What I've found so far is, in Texas you are allowed to charge each unit as if it holds max occupancy. (Ie. 1bdr can have 2 adults, 2bd can have 4 etc.) Other comps in our area which were all bills paid, installed individual meters for their units in the past 5 years. We have proced that out but the quotes we are getting are ridiculous. Oddly, my rents are at priced $25-$50 below all my comps but with all bills paid currently. That is a $100-150 value in Texas. That savings doesn't seem to translate to prospecitve tenants. They only see a slightly lower rent not even considering the all bills paid savings. The goal with "Rubs" will be to drop my new rents $75-100 but add in the utility payments. My revenue is the same either way but my rents will be well below my area comps. Also, it will help to curb over usage of water, gas and eletric which seems to accompany an all bills paid community. I am getting a company to come out and give me a quote on submetering setup and find the hard cost for this transition. If the numbers make sense we will move forward. I will keep everyone posted. If you feel I'm making some wrong moves, please speak up. One thing I know for certain is I don't know everything. I always appreciate experienced input.

No updates to post yet.  I have been slow moving in this process as we are in the middle of some other large projects at my other properties.  I plan to get estimates in January and really start figuring out if this will be a worth while endeavor.  I will definitely update this thread as we gain info.

You can usually find info on the utility fees charged by the comps on Apartments.com or on the apartments website. If all else fails, call into the property and pose as a tenant and ask them what types of extra fees they charge.