Welcome to Principles of Property Management

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Welcome to Principles of Property Management

• RDEV 688D
• Instructor Julie Smith
• University of Maryland
• January 30, 2008

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About Bozzuto

• Formed in 1988
• Privately held
• Headquartered in Greenbelt, MD
• Full Service Real Estate Company
• Development
• Construction
• Management
• New Homes
• Landscaping

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Bozzuto Management CompanyPortfolio Detail

• 22,500 units under management in 76 properties
• 45 Class A
• 40 Class B
• 15 Class C
• 65 of portfolio owned by third parties
• Institutional client base
• 25 highrise/75 mid-rise and gardens
• Geographic breakdown
• 30 Virginia
• 53 Maryland
• 2 DC
• 15 Philly/NJ

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What do you need to get out of this class?

• You need to understand what renters want
• You need to understand what owners want
• You need to know how properties actually operate

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General Expectations of Property Manager

• Screen prospective residents
• Collect rents from residents
• Make or coordinate repairs
• Enforce rules as specified in the lease agreement
• Resolve resident issues and complaints
• Inspect the property on a regular basis
• Oversee capital improvements
• Pay operating expenses associated with the
  property
• Manage an engaged, experienced and trained
  property team
• Provide agreed upon schedules of accounting and
  reporting
• Market the property effectively to prospective
  residents

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The Value a Good Property Manager brings

• Achieve Property Owners Objectives for the Asset
• Generate current cash flow
• Continually increase asset value

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Primary Business Drivers

• Full Occupancy
• Delivering Results
• Engaged Employees
• Spotless and working communities
• Happy Customers
• The Best Operators are FRESH

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Our Semester at a Glance
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Grading Model
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Final Project and PresentationFeasibility Plan

• Executive Summary
• Project Description
• Risk Analysis
• Proforma (Financing Summary)
• Operating budget and rent schedules
• Construction loan, equity preference and
  interest rates
• Market Summary
• Proposed product
• Maps and photos

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February 6thDollars and Sense

• The Economics
• of Apartments
• Proformas, budgets, cap rates, rent schedules,
  expenses, unit mixes, financing, absorption
  rates, turnover, employee performance, real
  estate taxes, utilities, marketing plans . . . .
  .

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February 13thProperty Management Software
Systems (lab) Pricing models
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February 20thMarket Research and Demographics
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What is most important to renters?

• 1. The Apartment (4.71)
• 2. Maintenance Service (4.62)
• 3. Overall Service (4.49)
• 4. Parking (4.47)
• 4. Building Interiors and common areas (4.39)
• 5. Grounds and landscaping (4.12)
• 6. Fitness Center (3.98)
• 7. Pool (3.55)
• 8. Business Center (3.32)
• 9. Clubroom (3.16)
• 10. Social Activities (3.01)

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The Gen-Ys Have Arrived!

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Demographics Who are They?

• No definitive agreement of birth years experts
  say somewhere between 1978 and 1995, most say
  1981 to 1993
• Children of Baby Boomers
• Younger siblings of Gen Xers
• Largest generation (75 mill.) after the Boomers
  (80 mill), compared to the Gen X (40 mill)
• 38 of millennials identify themselves as
  non-white one out of three is a minority
• 25 live in a single-person household
• Three in four have working mothers

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Effect on the Workplace

• Represent 21 of the workforce nearly 32
  million workers

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Not to mention. . .

• Never experienced life without
• computers
• All information is a click away, so is the
  competition
• Depend on the internet more and more for
  interactive communication and shopping
• Used to fast-paced and constant communication

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The Cultural Melting Pot
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Immigration

• Immigrants make up 12 of the U.S household
  population
• In 2006 1 in 5 people were immigrants in the
  Washington region. In 2005 it was 1 in 6
• Washington is now among 8 metro areas with
  immigrant populations of 1 million or more
• The regions immigrant population has more than
  doubled since 1990, while the overall population
  grew by one quarter

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Characteristics of Washington area Immigrants

• Most of the immigrants live in the regions three
  biggest counties Fairfax (Asians), Montgomery
  (South American and Asian) and Prince Georges
  (African and Caribbean)
• 4/10 hold a college degree compared with less
  than 3/10 nationally
• In Loudoun County 51 of immigrants hold college
  or advanced degrees
• 4 in 10 immigrants dont speak English well.
  Nationally the figure is 52

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How does this impact housing?

• Bozzutos employee base represents 51 nations
• We hire people who are bi-lingual and tri-lingual
• We use Language Line as a translation tool
• We consider immigration trends when making hiring
  decisions
• We work to understand the nuances of the various
  cultures at our communities
• We ensure that the residents fully understand how
  to operate their apartments

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February 27 - WIREDMultifamily Technology
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Wired

• The future has a way of arriving unannounced
  George Will

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Computers at Home

• 92 of Bozzuto residents own a computer
• 84.4 of residents subscribe to Internet service

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March 5thFair Housing and ADA Compliance
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March 12thMidterm Exam
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March 19thSpring Break
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March 26thAffordable Housing Case StudyGW
Carver Apartments, Washington, DC
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April 2ndManaging the Physical Asset
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April 9thNew Construction Field TripBethesda or
Crystal City
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April 16thDesign, Marketing and The Internet
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Dsign within Reach
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Apartment Design Trends

• Interior Dens
• Industrial style lofts
• Big windows
• Contemporary, track lighting
• Hardwood, stained concrete
• and cork floors
• High-end hardware, cabinet pulls
• Kitchen islands
• Granite kitchens/marble baths
• Open, light floor plans
• Crisp, clean lines
• Smaller unit sizes

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Trends in Amenities

• Media Rooms
• Demonstration kitchens
• Billiards rooms/pubs
• Yoga/Pilates/spinning rooms
• Outdoor fireplaces
• Climbing walls
• Massage/spa service rooms
• Bark Parks/dog runs

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Work and Play
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Resort-quality pools
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The New Leasing Center
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E-Everything!

• Call Centers
• Lead Management
• On-line Leasing
• 24/7 Virtual Offices
• Auto-follow up systems
• On-line rent payments
• On-line service requests
• On-line renters insurance
• On-line utility hookups

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Customers want to do business when it is
convenient for them
of Transactions
24-Hour Day
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How and When do residents want to communicate
with us?

• When?
• Over 20 before we open
• Over 20 after we close
• Over 12 24/7
• How?
• 61 want to use e-mail
• 81 want to speak on the phone

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Visited Versus Sight Unseen Online Reservations
2005
2006
of sight-unseen reservations has doubled
Visited
Sight Unseen
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Website Contact Us Page

• Contact info goes directly to Lead2Lease when
  prospect clicks on Submit button
• An auto-response thank you e-mail is
  automatically sent to prospect

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Lead2Lease Lead Record

• This is the electronic guest card which serves as
  the lead record for that prospect, it shows
  contact info, ad source, actions taken by leasing
  staff and end result (successful lease)

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Find Available Units
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Play with Furniture Arrangements
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Reserve Units
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Purchased1.5M impressions on www.washingtonpost.co
m
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April 23rdRisk Management
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April 30thMixed Use Field TripWashington, DC
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Urban Living
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May 7thGreen Management/Wrap Up
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Conservation

• Lighting retrofits
• Water meters and rubs programs
• Waters savers on shower heads
• Low-flow toilets
• Solar panels
• Programmable thermostats

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Green Materials

• Energy Star appliances
• Bamboo floors
• Cork flooring
• Recycled countertops
• Programmable thermostats
• Double-paned windows
• Green roofs

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Green Challenges

• LEEDS Certifications (Leadership Environmental
  Energy Design Standard)
• No set standard yet for multi-family
• Municipalities latching on to the idea and adding
  requirements to new developments
• NMHC and NAHB working together to come up with a
  standard.

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May 14thPresentation of Feasibility Projects
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Its not the strongest of the species that
survives, nor the most intelligent, but the one
most responsive to change. Charles Darwin