Asset Management Questions for Experienced Apartment Investors

[Theo Hicks]

Hello everyone,

I am trying to compile a list of the best asset management practices from active apartment investors. If you have experience with asset management and multifamily properties, could you please provide an answer to a one, a few, or all of the following questions? 

1. How frequently do you have calls with the property management company to review the property operations? 
   • What types of metrics (e.g., occupancy rate, rent premiums on renovated units, vacant-leased unit, maintenance issues, evictions, number of units renovated, etc.) do you ask for?
2. Of these metrics, which ones are the most important to focus on? (e.g., expenses align with projected budget, minimizing unit turns or lease-ups, maximizing occupancy, achieving rental premium projections, etc.)
3. What do you expect from the property management company in regards to reporting (i.e. what types of reports, frequency, etc.)? 
4. What is the best way to obtain these reports from your management company? 
   • Email? Integrating with their software? Purchasing your own 3rd party software?
5. Any other advice as it related to overseeing things at the property as an asset manager

Thanks!

[Lizzie Carver]

Hi Theo! I have a couple of rental properties and my regular FT job is in commercial real estate asset management (big properties). I would suggest creating your own basic custom spreadsheet that gets updated and sent to you monthly by your PM (unless they already have their own and you like it). I would want the following:

-A detailed income statement that compares monthly and YTD line items and shows $ and % variance. I would ask the PM to provide notes on any variances past a threshold that is meaningful to you. Sometimes it may be a simple timing variance (landscaper billed at the end of the month so your budgeted $50 for September vs. $0 actual will even out with $100 in October for ex.) vs. something you may care more about. 

-A letter or summary at the front that breaks out any operational issues (evictions, maintenance issues, late rent, etc.) which I would expect to be called/emailed about in real time prior to the report. The reporting should not replace regular communication.

-A rent roll showing unit, tenant, commencement/expiration dates, rental rate

-A leasing update, assuming you have vacant units or upcoming vacancies to see metrics on # of tours, feedback, where they are in the process.

-A summary/tracking sheet of any budgeted capital expenditures