Blog Posts

What’s in store for property management in 2019?

According to Urban Land Institute’s annual Emerging Tends in Real Estate® report, 2019 is not to be easily predicted, with trends that are more complex and less certain – but that could also provide for a promising outlook long-term. The report forecasts that an overall economic slowdown could make it more difficult for investors to capitalize on new opportunities. It anticipates suburban markets attracting more young adults – especially communities that offer walkable environments and access to transportation. And amenities are becoming the name of the game in today’s competitive rental market. What’s more, technology is disrupting traditional approaches to real estate – from artificial intelligence and smart buildings in the commercial space to online platforms that are changing the way home sales are transacted. Going green and environmental sustainability continue to be part of the conversation. And with most new construction in the multifamily sector focused on the upper end of the market, concerns remain about housing affordability long term. How do these national trends translate to the mid-Atlantic market? While we have no crystal ball, we are keeping watch in a number of areas to help our clients, residents and tenants navigate the changing real estate landscape. There is no shortage of cranes in the sky, and Baltimore’s multifamily real estate market may begin to see oversupply and above normal vacancies. We will remain vigilant and continue to look for ways to attract and retain residents while maintaining competitive pricing as more area properties struggle to maintain occupancy levels. Given the predicted economic slowdown and the increasing trend in flexible and shared workspaces, commercial properties are expected to see more vacancies and will need to adapt to the increased demand for greater amenities – from plush lobbies and redesign of workspaces to more advanced technologies and services that make tenants’ lives easier – if they are to remain competitive. We will continue to help our commercial real estate clients assess their properties and identify opportunities for improvements that will help them maintain their appeal. And while the predicted correction in the home-buying market (given inventory shortages and increasing interest rates) may be perceived as a good thing, this could mean lower borrowing capacity and buying power for those individuals focused on maintaining a certain monthly housing payment. Homeowner and condo associations will need to ensure they are efficiently handling their funds, carefully planning and saving for future capital expenditures, and diligently taking advantage of opportunities that benefit their bottom-line. At WPM, we remain committed to working together with our clients and partners to leverage our collective strength, challenging ourselves and each other to strive for continued improvement. Through careful analysis and attentive planning, we continually look for ways to improve efficiency and productivity. Which trends or predictions will prove true in 2019? Only time will tell. But one thing remains certain – we will continue to serve the needs of our clients with a passion, level of excellence and commitment that ensures our performance adds value.

Life of the Streets

You get one chance to make a first impression. And for commercial properties, part of that first impression is based on the condition of the streets, driveways and parking lots that potential customers use before ever entering your building. Therefore, it’s imperative that property owners make a great first impression by Preventing and Preserving , to Prolong their drivable area’s useful life. Prevent. While wear and tear on your property’s asphalt is inevitable, you can slow the deterioration in the following ways: Fix drainage problems. Standing water seeps into asphalt causing it to crack and break down, creating potholes. Stop this problem before it starts by touring your property’s asphalted areas after a heavy rainstorm to see where water has pooled. Then redirect water flow to address these problem areas. Reduce the load. Larger vehicles such as trash trucks and commercial trucks wear down your property’s asphalt. So limit your asphalt’s load by positioning trash dumpsters near the entrance. You can also reinforce areas near loading docks to protect driveways from heavier trucks. Preserve. There are several routine maintenance tasks you should perform to extend the useful life of your property’s streets, driveways and parking lots. Seal it. Sealcoating your lot not only protects it from the elements, but it also keeps it looking fresh and new longer than a non-coated lot. Fill it. Small cracks will eventually appear in any asphalt or concrete surface. The key is to fill those small cracks before they become bigger cracks. Clean it. Keeping your lots and streets clean not only helps you create a great first impression, but also contributes to their longevity. Regular cleaning prevents damage caused by debris. It also makes it easier to see the condition of the lot and attend to problems. Prolong. Performing regular repairs and preventative maintenance to your drivable areas prolongs their life. This saves you money in the long run, as you’ll have to repave or replace your streets and lots less frequently. What’s more, it’s easier to budget for ongoing preventative maintenance. So remember: make a great first impression by Preventing and Preserving to Prolong !

Understanding FHA Certification

We are often asked by our condominium and homeowner Association clients: What is FHA certification? And why is it important for our Association to be FHA certified? Here’s what you need to know about both of these important questions. What is FHA certification? The Federal Housing Administration (FHA) is a division of the United States Department of Housing and Urban Development (HUD) and is a government-owned insurance company that insures home loans for buyers who cannot afford a conventional down payment or prefer to use their funds in other ways. The FHA has come up with specific criteria that it believes will help minimize the risk of default on home loans. And if your condo or homeowner Association is FHA Certified, then loans on the units in your development are eligible to be insured by the FHA. This does not mean that buyers obtain their loans from the FHA. Rather, eligible buyers obtain their loans from approved lenders and the FHA guarantees the loan. FHA certification is attractive to lenders because FHA-certified loans are eligible to be sold to Fannie Mae and Freddie Mac. Fannie Mae is another name for the Federal National Mortgage Association (FNMA), which the government created in 1938. Freddie Mac is another name for the Federal Home Loan Mortgage Corporation (FHLMC), which the government created in 1970. These large financial institutions were created to stabilize the home mortgage market by purchasing home loans from lenders, in turn allowing lenders to replenish their capital funds to be able to issue more loans. For your Association to be eligible for FHA certified loans, your Association must meet requirements that fall into five general categories: Property type and use, Financial stability, Operational stability, Insurance requirements and Legal requirements. Why is it important for your Association to be FHA certified? FHA certification should be very important to your Association for several reasons: It adds value . FHA approval can actually increase the value of the properties in your Association. That’s because FHA approval makes it easier for more people to get loans to buy into your Association. The general adage is that the higher the demand, the greater the selling price. That’s good news for the value of the units in your Association. Naturally, the opposite is also true: for communities that don’t get FHA approval, it limits the available buyer pool. Less demand results in less value. It makes it easier to sell . When your Association is FHA certified, it opens up the resale of a unit to a greater pool of potential buyers. And, when demand is high, it is likely that units will sell more quickly and at the asking price. It commends your board to Owners . Working through the approval process sends a strong message to Owners that the Board cares about the Association and is positively contributing to the community’s value. FHA certification offers great value to your condominium Association. If your Board is ready to begin the process, you should seek the assistance of your property management firm or a third-party company who specializes in FHA certification.

If you lived here you’d be home by now

It’s Friday afternoon. Your car is in a sea of traffic, slowly slogging its way out of an overcrowded city. And just ahead, on the side of the busy road, you see a row of well-maintained apartments next to a billboard that trumpets, “If you lived here, you’d be home by now!” A roadside billboard is just one of the many ways to reach potential residents. Property managers of multifamily real estate need to be very strategic about using collateral and marketing tactics that 1) maximize their advertising budget, and 2) build a brand for that particular property. WPM Director of Multimedia Marketing and Communications Brent Gratton describes his process for achieving these two objectives for a brand new or takeover property. “A lease-up property has no face. It’s up to us to communicate a property’s points of distinction. When we start, we look at who is the resident or demographic for this property. Will it largely be students? Is it intended to be high end? Then we put ourselves in the shoes of that target market.” From there, Gratton’s team creates collateral—the collection of media used for marketing—that helps the property stand out to that specific potential resident. “We understand that perspective residents have choices. There may be five different properties in the same area with similar amenities. So how can we help our property stand out? One strategy is helping the resident envision his or her life in our property. All of the images and language of our collateral depicts the lifestyle the resident will enjoy if they lived here. For example, we may create a sidebar of ‘Things to do’ on a brochure or webpage so that they can picture what their first Saturday as a resident would look like.” Another essential element in Gratton’s narrative about a property is the promise of community. “People don’t want just a residence, they want a community,” he explains. “We foster camaraderie among neighbors by hosting and encouraging social events, such as ‘yappy hours’ for pet owners, wine night mixers or even creative events like a murder mystery dinner. These events help residents feel more at home because they build friendships with each other. This, in turn, helps us because it means they are more likely to stay. Naturally, a property with a great sense of community is a selling point that we are certain to highlight when reaching out to potential residents.” Obviously, this is too much information to fit on a billboard! So which media provide the best options for getting a property’s “story” in front of potential residents? Gratton asserts that the best way to reach perspective residents is online. “Print advertising is no longer the way to go,” he explains. “The best way to maximize your marketing dollars is to place ads on Facebook, Twitter, Instagram and Google.” Not only are these placements often less expensive than traditional print, they boast the added benefits of “re-targeting”—a cookie-based technology that anonymously follows the target buyer all over the web—and returning valuable analytics about the ad’s performance, such as the click-through rate. These ads then drive traffic to a property’s website, another key piece of the suite of marketing materials that tell a property’s story and paint the scene for potential residents. So back to that roadside billboard… Chances are, if you, as a weary commuter, were interested in avoiding traffic and moving into those tempting apartments, at the next stoplight, you might pull up that property’s website on your phone. And if Gratton’s team did their job well, you would spend a few moments picturing what your life would be like if you lived there. And later that night, when you finally made it home and were relaxing and scrolling through Facebook, an ad for that property would “re-target” you and show up in your newsfeed. Next thing you know, you’ve clicked-through to the website to view gorgeous property images and imagine how much fun you’d have at a community wine night and how convenient it would be to be able to walk to so many nice restaurants… And before you know it, the combination of great storytelling and advertising placement may just have the desired effect of converting you from commuter and prospective resident to resident.

Handling Homeowner Complaints

Being an HOA board member has its perks: you get to know your community really well, you have a say in your community’s governance, and you have a direct hand in enhancing and preserving the beauty of your neighborhood. But there are also quite a few challenges that any Association board member also may endure. And perhaps chief among those headaches are complaints from Homeowners. Below are some of the most common complaints and a few proactive strategies Board members can use to respond. Complaint: My neighbor is always parking in my spot! Many developments have assigned parking spots with limited spaces reserved for guests. Problems arise when other residents or guests park in their neighbors’ assigned spots. Some Association documents do not permit assigned parking and the problem arises when residents become accustomed to a particular “unassigned” spot and another resident parks there. Solution: When permissible in the Association documents, Boards should clearly establish parking rules and regulations and provide a complete explanation with diagrams. They can also create a parking committee to patrol the lots and tow accordingly after proper notice and hearing (again, dependent upon the documents). Complaint: The common areas are a mess! Cigarette butts on the sidewalks, trash left in the lobby, elevators door tracks that are dirty, overgrown flower beds and more can really detract from the appearance of a community’s common areas. Solution: Boards can respond by forming a committee of members who can monitor the common areas and report frequent offenders. Diligent property managers should also conduct frequent walk-throughs and determine if there is a recurring problem that needs to be addressed. For example, is the lobby trash can always overflowing? Add more trash cans or ask the janitorial crew to empty it more often. Regarding outdoor shared spaces, Boards along with the Manager should meet with the landscaping company or janitorial service before contracts are executed as well as periodically throughout the year to clarify ongoing expectations. Complaint: My assessment fees are too high! While residents may understand and agree to their annual fees before moving in, that doesn’t mean that they have to like them! Solution: Boards can (1) do their best to keep Association fees low, and then (2) communicate the value that these fees enable the Association to provide. In order to keep fees as low as possible for Homeowners, boards, through the Manager, should carefully examine all contracts when preparing the annual budget. Verification that vendors are fulfilling their contracts, as well as routinely securing additional comparable proposals to ensure the association is getting the best services and rates is best practice. Once certain that they are doing all they can to keep costs down, boards should communicate their achievements to the Homeowners! Boards should explain existing contracts and the annual budget to residents in written communications. They may also consider creating a Q&A sheet of frequently asked questions to further explain the amenities, services and maintenance that a Homeowner’s assessment actually supports. Complaint: My neighbor isn’t following the rules! My neighbor’s fence height, or lawn art, or loud music is a violation of our documents! When a neighbor infringes on another resident’s rights, the wronged party is usually eager to air his grievances with the board. Solution: The first step in addressing this complaint is to ensure that residents are clear about Association documents. When dealing with renters, boards may be able to adopt a rental lease addendum that requires a signature from the unit owner and the tenant to ensure that both have received, read and understand the rules of the community. When working with homeowners, hold outreach events that foster a sense of community. This gives neighbors the opportunity to get to know each other on a more personal level, building esprit de corps . Grievances can be discussed candidly and directly with the neighbor. Then the board may not even need to get involved. Complaint: My neighbor isn’t picking up her dog’s poop! While this could have fallen under “The common areas are a mess” complaint, the frequency with which boards encounter this particular problem earned it its own category! In fact, boards regularly receive a whole host of complaints about pets, such as dogs that bark incessantly, animals that are not properly restrained in a fenced yard or on a leash or breeds that are too large and violate an Association’s rules about the types of pets allowed. Solution: Boards can encourage residents to report violations in writing to the animal control division of the municipality as well as management. Neighbors could even try to get photo documentation of the offending dog. Boards should make it easy for residents to dispose properly of pet waste by providing bag dispensers and animal-waste stations. And for animals that routinely violate the noise ordinance or are not on the list of approved breeds/size, then it could mean (depending on the Association’s documents) that either the dog goes or the resident must go! As long as there are people living in close proximity to other people, there will be complaints. Good boards know that addressing complaints is not just a chore and a headache. Rather, it’s an opportunity to serve community members and help each resident enjoy their neighbors and neighborhood to the fullest.

Safety and Security Tips for Commercial Properties

According to Murphy’s Law, “Anything that can go wrong will go wrong.” And commercial properties are especially susceptible to this adage. Commercial properties host hundreds (or even thousands) of customers and employees each day and may often house machinery, merchandise and other equipment worth millions of dollars. That’s why property managers must be especially vigilant regarding the safety and security of the personnel and property they oversee. Below are some tips to help improve the Safety and Security of commercial properties. SAFETY Invest in good lighting. Sufficient interior and exterior lighting is important. Good outdoor lighting helps drivers see other cars and pedestrians. It deters theft and loitering. It illuminates steps, uneven sidewalks or other tripping hazards. And it contributes to the overall appearance of the property. Indoors, good lighting makes fall risks more visible. And remember, while some tenants may prefer low lighting to add to the ambiance of their property, safety should always be prioritized over aesthetics! Identify fall risks. Landlords should regularly perform safety audits to identify fall risks. Walk the property and look for things like loose steps, uneven flooring, slippery surfaces or obstructed walkways. Winter weather elevates the risks for any property. Icy sidewalks and snow-covered parking lots require property managers to be even more vigilant for fall risks and address them before someone gets hurt. Prepare for emergencies. Property managers should always hope for the best and prepare for the worst. Like any structure, your commercial property is susceptible to lightning, high winds, fire, terrorist attacks, flooding and more. It’s a sobering list. Each potential disaster requires a disaster response and restoration plan. But creating the plan is only half the job. Updating and practicing your response is the crucial component of any disaster mitigation plan. SECURITY Install a quality alarm system. Step 1 for securing any property is installing a good alarm system with a reputable company that provides 24-hour surveillance. Limit entrances. If your property has multiple entrances, consider limiting tenants and their customers to using one, monitored entrance, and keep other exterior doors locked from the outside. (Per fire codes, they will need to remain unlocked from the inside.) It’s far easier to know who is in the building if there is just one entry point. Hire a security guard. When budgets allow, a security guard adds extra monitoring and also lends a sense of security for tenants and their clients. Of course, while these security tips help commercial properties be more secure, there is no way to completely safeguard any property. WPM Commercial Property Manager Tiffany Smith cautions, “No Landlord or Condominium Association should assume liability for the security of an Owner’s suite or of the general common area. Even if the Landlord or Association agrees to hire a security guard, this is never a sure guarantee that everyone is safe. The best way to handle security of common areas is to ask Landlords, Tenants, Boards, and Owners to work together and report anything that seems suspicious to the police department.” While Murphy’s Law is often true , the prudent property manager should follow these tips and answer Murphy with this: “Anything that can be planned for or prevented will be planned for or prevented!”