Mills Properties
In Or Out
JHerzog · · 4 Comments
I wrote a post on my regular blog, RealLifeSTL.com recently about fashion trends for 2013. We used it to create a game for our podcast called In or Out (kind of playing off the old game show Street Smarts). Basically, we drove around to a couple of different places in St. Louis asking people to give us their opinions on whether certain fashion trends are ‘In’ or ‘Out’ in 2013 as compared to what we read on fashion websites.
It got me thinking about marketing trends and how there are differing opinions on what’s ‘in’ or ‘out’. Some trends are split straight down the middle while others are about 99% obsolete but still used (or worn) by some for lack of knowledge, money or just stuck in their ways.
I know my opinions aren’t the same as everyone, not even everyone within my company, so I’d like to play the In or Out game, this time to get opinions from people, and not just other management companies in St. Louis but people in the multi-family and marketing industries across the U.S., on what marketing trends you believe are ‘in’ and ‘out’.
I’ll start:
In
- Engagement through Facebook
- Promoting Ratings & Reviews on your own website
- Getting involved with local community events/organizations (ex. blood drives, chambers, non-profits)
Out
- Car/door flyering
- ILS print advertising
- Faxing/e-mailing hot sheets or coupons to local businesses
I’d love to hear opinions of others on marketing trends that are In Or Out?
You can check out the RealLifeSTL Podcast here.
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Restless
If you become someone who is uncomfortable unless he/she is creating change, restless if things are standing still, and disappointed if you haven’t failed recently, you’ve figured out how to become comfortable with the behaviors most likely to make you feel safe going forward. – #sethgodin – The Icarus Deception
#gameon
I don’t know about you but I get restless more than I care to admit. I think life should be moving along a lot faster than the borderline meaningless tasks that I partake in. I catch myself – more times than not – thinking about how – in the bigger scheme of things (read: cosmic sort of stuff) – half the to-dos I am asked for are just nonsensical. Add $5 bucks to this line item, take $40 off that line item, add a period after this comment or that comment, use affect instead of effect or reword this because it does not fit my view of the world. Nonsense.
What matters in our business? The perfect budget. Not in your lifetime. The real deal is – people. The real deal is – relationship. The real deal is – collaboration. The real deal is – synergy. The real deal is – character. The real deal is getting cool stuff accomplished. You can’t capture that on a spreadsheet. Never. But, guess it – that is what matters most. Financiers, bankers, hard money, investors, etc.. – makes not the difference. I get it – you are analytical. But spreadsheets don’t get business done – people do. Proformas don’t make it happen – people do. Data entry doesn’t make it happen – building energy does.
The Mark of a Leader
Recognize when the natives are restless. And, get the nonsense (as they view the world) out of their way.
Good business happens by default when your business serves the people who are serving it.
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Apartment Budgeting: Trash Income
It’s time to talk trash. Not that recent election type trash. Not the fiscal cliff type trash. And, not your run of the mill sports trash talk. Albeit, that has its place and is fun when kept in good spirit. No – we are talking about making some income from your apartment communities trash collection.
Trash Income Defined
Trash income comes from charging back or passing through the expense that you incur for having your communities trash hauled away. And, unlike water and sewer income – trash is not a regulated utility. That means you can charge back more than your monthly invoice. For reference, I have seen this number range anywhere from $3 to $8 per occupied unit per month. I would highly recommend that you use a third-party utility billing firm to administer this for you. Typically, this is billed monthly with your water and sewer charges. The more sophisticated services include rents and other applicable fees on the same monthly billing statement.
Budget Strategy
This one is fairly straight forward and most budget models will have a formula baked in. If not, you can take your average number of occupied units over the course of the year and divide the total trash spend by that number to come up with an annual per unit number. You can then divide that number by 12 and the answer is the minimum number you should charge per month to recoup your cost. For example:
Community: 212 units – 94% forecasted 2013 occupancy – $12,000 trailing 12 months trash bill (forecasting zero increase for 2013).
212*94% = 201.4 average occupied units
$12,000/201.4 = $59.58
$59.58/12 = $4.97 per occupied unit
This is the minimum amount you would want to bill back in order to recoup the full cost of your annual trash bill. Now remember – trash is not a regulated utility. With that fact in mind, I think it prudent to charge more. In this example, I think $6 or $7 per occupied unit is completely in line.
In closing, increases in utility cost historically outpace rent increases. That said, it is would be borderline careless to not share that cost with the people who benefit from the services.
Your always looking for a way to maximize revenue multifamily maniac,
M
pic props: Tony Jacobson
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MonitorHits
I have a special guest post for you today. It’s on the topic of tracking and more specifically on the tracking Craigslist posts.
It comes to us from Ryan Brockschmitt who spends many of his daytime hours at The Laurel. A downtown St. Louis property that is managed by Mills Properties. Now, I could give you a line or two on Ryan but I think he does a much better job himself:
Ryan is still trying to find his place in life. He went to the University of Missouri-Columbia for journalism like everyone goes to Mizzou for. That journalism passion somehow turned into a Hotel & Restaurant Management degree and five years in the hotel industry. After finding it hard to make a living as a pizza delivery driver, he is trying to find his place in the world of multi-family housing. Ryan runs iLoveSoulard and Welcome2STL in his spare time and can usually be found in Soulard living the high life. He asks that any single ladies who frequently wear sundresses and cowboy boots and happen to read something he has written email him at their convenience.
If there are two things I don’t understand, it’s apartment marketing and dating.
Since this isn’t a dating site, we’ll look at an aspect of apartment marketing. From what I understand and can gather from my brief time in the apartment industry, most companies want multiple posts a day on Craigslist about their apartments. I’ll hold my personal feelings on that back because I enjoy my job and want to keep it.
Ideally, you want someone to read your post and think “I need that”. But how do you make that happen? I don’t think there is a magic pill in apartment marketing. When I was in the hotel industry, I never really had to think of marketing the product. You put your prices in to all of the channels and the people just magically show up. As long as you make sure the people writing reviews are happy, people will keep coming. And really, even if the “Yelp Elites” aren’t always happy, the Priceline and Hotwire folks will continue to show up.
The commitment to stay in a hotel is a lot less than it is to sign a lease on an apartment.
There are plenty of things you could read online and try to emulate, but do you really want to just believe that their market is the same as yours? Circling back to the dating reference, I equate this with sitting at a wedding hearing the bride and groom talk about how they were “so in love” since the day they met and knew they were going to marry each other. If you then go out into the dating world and really think that you are going to meet someone and it will be all rainbows and unicorns for the rest of your life, you are going to be disappointed. You have to live in reality and realize that maybe the people writing that post about what to do and what not to do may be looking at a different market than you.
I wanted a way to track my Craigslist posts and figure out what got people to click on posts and what days/times seemed to get the most views. I ran across MonitorHits.com. It’s a simple script that puts an image in your post that is embedded with a tracking code. From the website, you can track your hits by day/time and by the location of the IP addresses.
I interviewed the guy behind the code, Nick Mote, via electronic correspondence.
How long did it take you to develop the MonitorHits code?
The initial site was coded and launched during a three day weekend last November (2011). I work full time and have continued working on the website on my spare time.
How did you use the code for your own posts?
At the time me and my wife (girl friend at the time) were strapped for cash and needed to sell some things on Craigslist. I started selling electronics including my Kinect, Ipod, Digital Camera, and an old laptop. I really enjoyed getting real time feedback on my listings and soon noticed that this website could be a valuable tool for power users such as car dealers and real estate agents.How many hits were you seeing on them?I lived in a small town, Yakima Washington, for the past couple years. The traffic my personal items generated was puny. I think my old Galant received the most views with around 700 hits a week.What did you learn from using the hits on your own posts?I really learned the power of being on the top of the list. I wrote a small article on my blog called “the Craigslist Drop-off Effect” describing the importance of re-posting after the 48 hour spam filter. I also learned how large the Craigslist audience was and how few people actually translate to potential buyers.Have you done any experiments using the stats that you have gathered from users on the site?I have not. I plan on publishing some overall trend data gathered from Craigslist. I plan on having general user information such as posting time vs. posting traffic and move into more Metro data as the user base continues to grow.How many codes have been used?I estimate we have had over 10,000 unique codes that have been active on Craigslist.How many different people have created accounts on the site?As of this morning we are at 336 registered users.
What percentage of people have used the premium codes?
In the last 30 days premium codes represented 39% of all active tracking codes.What is your background? Location? Education? Other Projects?Me and my wife are newly weds and live in Spokane Washington. I have a Bachelors in Business Administration Specializing in Marketing Management from CWU and am the Assistant Marketing Manager for Tree Top, inc. I’ve been dabbling in app development and hope to launch my first app later this month.Where do you want to take this site? New features?I have some new features in the works that I think will really benefit the real estate and car dealer power users. I plan on incorporating an api where users can dynamically incorporate tracking codes into their template software later this year. I also plan on expanding the site past Craigslist to other platforms such as Ebay, Backpage, Facebook, forums, and email tracking.What’s in your future?I plan on further developing my professional marketing experience with the goal of opening my own company that pioneers and markets new digital services and products.
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Apartment Budgeting: Parking Income
Wanted to pause a second to say thanks for all the feedback on the budgeting series – we (meaning you and me) seem to have a good thing going here.
We continue this week with the next line item in our apartment budget: Parking Income.
Parking Income Defined
Parking is an interesting subject. Interesting in the sense that one could posit that it should come included in the rent. While the other camp would suggest that it is an ancillary income and thus should be accounted for on a separate line item.
To define it simply – it is income derived from renting the right to use space in your parking lot or parking garage. That space could be reserved for exclusive use or the right to at very least have access to a space.
Budgeting Strategy
If you have a stabilized operation this is pretty simple. Look back at your twelve months of trailing history, consider rate increases and straight line it. Or, ebb and flow it with occupancy.
If you are in lease up – the work is a little more difficult and starts with a full market survey. Not unlike we do competitive surveys for assistance in pricing apartments – we do this to get a sense for pricing parking spaces. Now – no matter if you have a surface lot or a garage, I think it important to understand the pricing for both. And, I think it important to get a sense for what the barriers are.
I define barriers as the 3 block, 5 block and 10 block radius. I also lump in nearby walkable attractions be it football or baseball stadiums, museums or vibrant cityscapes. It all matters in your pricing and budgeting strategy. It really boils down to proximity with a bit of supply and demand layered over the top.
Once you have your market survey complete – you have to consider how quickly the spaces will get absorbed. If you have a plethora of spaces this is not an issue. But, if you have a dearth this is a big deal. You don’t want to sell out too soon. Neither do you want to get to the end and have left over inventory albeit I would prefer this to selling out to soon.
The key is paying close attention to what the market is telling you, be nimble and don’t be afraid to increase rates along the way.
Why Don’t We Include Parking in the Rent
I have asked this question no less than a dozen times and still to this day don’t know that I have a clear reason.
The top two reasons that I can recall off the top of my head are, 1. Tracking 2. Financing/valuation.
Would love to hear your feedback on the subject – until then…
Your apartment budgeting multifamily maniac,
M
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