SPEND YOUR MONEY THE RIGHT WAY
IMPORTANCE OF UNIQUE CURB APPEAL
presented by united renovations
FAKE IT ’TIL YOU MAKE IT
Giving residents a high-end kitchen without cooking your budget
NEW TECH RETROFITS FOR SMARTER UNITS
LEARN TO LEAD WITH NAVY SEALS
FIRST QUARTER 2017
LETTER FROM THE EDITOR
“We want to creatively communicate, inspire and help our clients be the best they can be at what they do.”
New Adventures
PHOTO DAVID HALLORAN
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Renovator. Your feedback will help us with future issues. You hold in your hands the beginning of a journey together. United Renovations would not be what it is today without you. The trust you have placed in us over the past 15 years has helped us grow, learn and evolve. We continue to move forward with you in this publication effort. Over the past months, we have partnered with some incredibly talented, award-winning men and women in the publishing industry to bring you something compelling and unique. We hope to continue to make Renovator magazine bigger and better as we navigate a new medium. But much like our commercial success, our editorial success hinges on you. So with that, we’re going on a journey. Want to come?
his all started with a conversation about advertising. We were evaluating ad buy opportunities in a few multifamily publications and we were frustrated. Sure, we’d reach a select audience who could appreciate the quality product we offer, but we’d also be limited in our ability to tell the story we wanted to tell. Compounded by the fact that the costs were high and the reach was not always ideal for us, an ad buy was seeming more and more like a missed opportunity. A close friend in the publishing industry, who at the time was the editor-in-chief of a 16 million monthly circulation magazine, asked me: “Why don’t you just start your own magazine?” Renovator magazine is about our desire to be a different kind of multifamily renovation contractor. We want to creatively communicate, inspire and help our clients be the best they can be at what they do. We want to share insights, trends and other valuable information to the owners and investors we work with. In short, we want to have a dialogue with you. You’re a part of a select audience for this inaugural issue of
JR Bolos Executive Editor
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TA B L E O F C O N T E N T S
30 RENOVATIONS THAT STAY ON PAR Making upgrades to units can earn you extra cash, but be sure you’re making the right investments.
34 HOW TO FAKE AN EXPENSIVE KITCHEN It’s where everyone hangs out, so make sure it shines. Yes, you can create a great kitchen on a budget.
40 CURB CHECK The first thing tenants see is the curb appeal of a property. So make sure the outside counts as much as the inside.
46 TAKING YOUR UNIT TO THE 21ST CENTURY These new-age improvements give older units a touch of modernity.
52 LEADING TO WIN: EXTREME OWNERSHIP MUSTER Former Navy SEALs bring their leadership skills from the battlefield to the business world.
09 BUSINESS What to expect during due diligence, smart green investments to consider, what really goes on in waterproofing and advice on getting the best bid comparison.
14 INTERIORS Prevent noisy upstairs neighbors with proper flooring, and bring class to your closets.
19 PROTECTIONS Know the difference between NDL warranties and labor warranties, the importance of insurance and proper waterproofing. 24 HOW-TO Learn the skills to renovate a lived-in unit, compare bids for the best bang for your buck, and select the right contractor for the job.
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26 ASK AN EXPERT Industry experts weigh in on how to make a claim when disaster strikes, what to look for when selecting a contractor and the benefits of conducting town hall meetings. 56 ON YOUR WAY OUT No matter what the experts say, duct tape does not fix everything.
MEET THE TEAM
INDUSTRY EXPERTS
This team of professionals represent a wide array of the renovation industry and brings their expertise to Renovator.
STEVEN BOLOS Steven Bolos, the owner of UR Holdings, founded United Renovations in 2001 to provide commercial and multifamily real estate with a full spectrum of construction services. Today, UR Holdings is comprised of three companies and a nonprofit foundation.
JR BOLOS JR Bolos joined the UR team in 2001. He is a partner in the company and serves on the Board of the UR Hope Foundation. JR has been instrumental in the growth of United Renovations. His projects have been awarded by a number of entities, including MFE Renovation of the Year in 2010.
JIMMY CROTEAU Jimmy Croteau has spent 11 years in the multifamily industry, where he has worked in design, account management, client services and project management. The winner of a recent Best Design for a Multifamily Clubhouse award, Jimmy is dedicated to achieving his clients’ vision and turning renovations into homes.
KEVIN KIRKWOOD Kevin Kirkwood is the co-founder and president of SRG Roofing, LLC, a national roofing contractor specializing in commercial and multifamily roofing. Kevin also sits on the board of the North Texas Contractors Association and holds certifications with some of the largest manufacturers in the roofing industry.
JR Bolos Steven Kirlin ART DIRECTOR Shawn Willis ADMINISTRATIVE MANAGER April Woods EXECUTIVE EDITOR
EDITORIAL DIRECTOR
EDITORIAL OFFICE
3200 Earhart Dr. Carrolton, Texas 75006 LETTERS TO THE EDITOR
editor@renovatormagazine.com
RYAN CUMMINGS Ryan Cummings has been in the construction and multifamily renovation industry for more than decade. In the three years he has been with United Renovations he has served in multiple production leadership roles and is now Senior National Accounts Manager.
LYN JACOBS Lyn Jacobs is Executive VP of Sales for Irving, Texas based Arbor Contract Carpet, Inc. and leads the Sales and Customer Service efforts for all locations in Texas, Colorado, Florida and Nevada. He has spent the last 17 years in Denver with Arbor and focuses exclusively on providing expert guidance for multifamily property owners and managers.
STEVEN KIRLIN Steven Kirlin joined UR in 2014, and is currently the Marketing Manager, supporting digital/ print media, graphic design and marketing strategy across all UR companies and the UR Hope Foundation. He is actively involved in expanding UR’s reach and influence through industry recognition opportunities, nonprofit service partnerships and creative storytelling.
J.T. HOUSTON J.T. Houston has been with the UR team since 2004, managing all aspects of multifamily renovation projects. He has worked in the real estate industry for 20 years, 13 of them in multifamily construction. He has managed over $280 million worth of multifamily renovation projects while with UR Holdings in more than 13 states.
JEFF VANDERVORST Jeffrey VandorVorst is the CEO of CAPgro Construction Management, an expert in pre-acquisition processes and has a passion for growing companies to their maximum potential.
STEVE DELEON Steve DeLeon is a certified insurance counselor at MHBT Construction Practice Group, one of the largest insurance brokerage and consulting firms in the United States. MHBT is headquartered in Dallas and has branch operations across the state. DeLeon has 20 years of experience working with general contractors.
DREW KIESLING Drew Kiesling of JLL Capital Markets has spent 28 years in and around the commercial real estate business. He focuses mainly on capital fundraising and development. His most frequent investment groups are those looking to purchase a multifamily property with an eye for renovation and resale.
ROBERT BLACK Robert Black is the Director of Construction for Resource Residential and has been in the construction business for 15 years. He’s handled everything from materials to budgets to project completion. In the process, he’s met with and hired all sorts of contractors.
Adam Pitluk David Halloran EDITORIAL DIRECTOR Amanda Ogle SALES DIRECTOR Xavier Rodriguez GROUP PUBLISHER
CREATIVE DIRECTOR
ABOUT MIDWEST LUXURY PUBLISHING Midwest Luxury Publishing is a full-service communications outfit made up of experienced industry experts. Based in Dallas, let us be your turnkey outfit for all your communications and publishing needs.
CONTACT THE PUBLISHER
midwestluxurypublishing@gmail.com midwestluxurypublishing.com 972.378.4845 FOR ADVERTISING INQUIRIES
advertising@renovatormagazine.com
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KYLE WEAVER Kyle Weaver is the president of United Renovations Specialty Group in Phoenix. He was promoted in August 2016 after three-and-a-half years as project manager. He is a seven-year veteran of the construction business.
Renovator will be published quarterly on behalf of United Renovations by Midwest Luxury Publishing, a subsidiary of Midwest Luxury Rentals, LLC. All material is strictly copyright protected and all rights are reserved. No part of this publication may be reproduced in whole or in part without written permission of the copyright holder. All prices and data are correct at the time of publication. Opinions expressed in Renovator are not necessarily those of Midwest Luxury Publishing, and Midwest Luxury Publishing does not accept responsibility for advertising content. Any images supplied are at the owner’s risk and are the property of the owner. Printed in Dallas, Texas, USA
Cover photo by Scott Wintrow/Gamut Photos
MEET THE TEAM
THE WORDSMITHS
With more than a few decades of experience between them, our dream team of writers and editors worked tirelessly to turn industry jargon to poetry.
JOE MURRAY Joe Murray is a New York-based writer and editor who has won numerous awards for investigative reporting. A New York native, he has worked in Cleveland and Miami, and has traveled the globe for various newspaper and magazine stories for many international outlets.
ALYSON SHEPPARD Alyson Sheppard is a writer and editor based in Dallas. Her work has appeared in Popular Mechanics and Celebrated Living magazines, among others. You can find her on Twitter at @amshep.
GWEN BALDWIN Gwen Baldwin has an extensive marketing background with American Airlines in advertising, publishing, loyalty programs, promotions, events, PR and social media. Texas based, she dabbles in all as a freelancer and tries to spend as much (free) time getting inspired in California and Colorado.
SAM OSTERLING Sam Osterling is a freelance writer from Huron, Ohio; passionate about movies, hunting, reading and Cleveland sports. He’s currently based in Norman, Oklahoma.
JOHN GONZALEZ John Gonzalez has written for the Philadelphia Inquirer, Boston Magazine, Dallas Observer, Thrillist and other publications. He recently moved from Philadelphia to Los Angeles, where he lives with his wife, their two dogs and their cat. They’re remodeling their new apartment. The animals are less than helpful.
AMANDA OGLE Amanda Ogle is a freelance writer and editor based in Fort Worth, Texas. She was a former editor at American Way magazine and loves to spend her time traveling, reading, playing with her dog and being outdoors.
CRAI BOWER Seattle-based Crai S. Bower contributes scores of articles and images annually to over 25 publications. He also adds creative direction and writes content for numerous companies and travel destinations. He is featured in The Seattle 100 – Voices that Matter. flowingstreammedia.net
DAVID HALLORAN David Halloran is a freelance photographer and writer. Formerly, he was the Photo Editor for American Airlines’ in-flight magazines. In addition to published work, David also has images in museums such as the Perot Museum of Nature and Science and teaches photography workshops in the wilds of West Texas.
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JAN HUBBARD Jan Hubbard is a freelance writer in Dallas. He previously worked at Newsday in New York, the Dallas Morning News and the Fort Worth Star-Telegram. He also spent three years at American Way magazine and wrote cover stories on Harrison Ford and Steph Curry. He has written three books on the NBA.
KRISTY ALPERT Kristy Alpert spent her childhood helping her dad out in his woodshed. She now spends her time as a freelance journalist, crafting articles instead of workbenches. Her bylines have appeared in Food & Wine, Esquire, American Way, Men’s Health and more. Kristy has won numerous international awards for her writing. www.kristyalpert.com
BRIAN SMITH Brian Smith was a former art director for American Airlines in-flight publications, where he won design awards for work on American Way, Celebrated Living and Nexos. His designs have been featured in a wide variety of publications. Originally from Amarillo, he now lives in Dallas.
ADAM PITLUK Adam Pitluk is the Contributing Networks Editor at the Dallas Morning News. Formerly, he was the Director of Publishing at American Airlines, a reporter for Time and People magazines and an adjunct professor at the University of North Texas and the University of Texas at Arlington. He’s the author of two books, Standing Eight and Damned To Eternity.
U R H O P E F O U N D AT I O N
Changing and Impacting Lives The UR Hope Foundation is impacting the lives of children one organization at a time, in-and-out of the ring. BY STEVEN BOLOS
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never planned to be in the construction business. As a young man, I struggled to be successful at a number of things. Frustrated, I started working as a painter. I didn’t possess any technical skills or much of an education. I barely graduated high school. I knew I could swing a paint brush, something I learned from my father. I started painting apartments, eventually had my own crew, and then founded a small business. After 10 years and founding multiple businesses, the need for a greater type of success became evident. My life had changed and so had my passion for business. In 2014, the UR Hope Foundation was formed to change and impact lives. This desire initially came through the founding of our first Ring of Hope Boxing Club in south Dallas. I grew up around boxing and wanted to see
this sport provide discipline and direction to inner-city youth. I was tired of seeing lives cut short or wasted by the influence of drugs, alcohol and gang violence. The next generation is our future. We opened the first Ring of Hope Boxing Club in 2010 to provide a place for the youth of Dallas to build physical and spiritual discipline, and to get mentoring support that gives them a hope for a better future. Each week, kids are offered exercise, boxing instructions from professional trainers and life skills coaching in a safe and encouraging environment. Through building relationships and Bible study, they learn their incredible value in the eyes of God. The Ring of Hope Boxing Club is open to boys and girls from across Dallas. Some teens compete in local, state and national boxing championship matches. Five years later, we have two clubs (Dallas
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and The Colony) and are actively expanding into new states with a goal of national impact. We are always looking for partners to join this fight with us. Our annual Night to Fight, coming up on February 23, 2017, raises funds to benefit Ring of Hope Boxing Club. Join us for our next great night of sanctioned boxing to support the Ring of Hope. We will once again convert the Frontiers of Flight Museum into a boxing venue and enjoy a great night of food, boxing and fundraising. Table sponsorships are now available. Beyond the Ring of Hope, I knew there was more we can and should do. For our companies to have success with significance, we must invest in our communities with time, money and manpower. Today, the UR Hope Foundation partners with over 15 non-profit organizations and ministries to directly impact the world around us. We believe that doing business with this kind of passion is not only for us but for other companies as well. We hope that our example might inspire others to do the same. If not us, then who?
“The Ring of Hope is connecting the community. Everyone sees each other every day. We are all on the same page. The staff is on the same page. The kids are on the same page. That is how you raise a community.� -Ansa Henshaw PHOTOS DAVID HALLORAN
Father
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BUSINESS
How a Renovation Runs Smoothly What investors are looking for during due diligence. BY JEFFREY VANDERVORST
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hen a renovation project seamlessly falls into place, it’s easy to think random chance and good luck are to thank; when in fact, there is an intricate balance of planning and methodology. Investors never rely on chance when purchasing a property, neither should a good renovation project. Just as the foundation is the most important structure of any building, so too is the due diligence process prior to acquisition. The entire project should be structured by the: Scope, Schedule and Budget (The Triple Constraint) formulated by the findings in the due diligence period. The due diligence is the one opportunity to observe everything that will impact your business plan. The first step in a due diligence is to perform a project feasibility assessment. Here at CAPgro we assess all deferred maintenance and life safety costs as quick as possible to then allow our client to determine if this is a property they want to add to their portfolio. Using a detailed due diligence process, we walk the property and document its condition among the 15 major categories such as: amenities, site improvements, interiors, exteriors, code compliance, landscaping, etc. During this
stage, we bring in the contractors, engineers, designers, and others necessary to give you a precise analysis. It will matter in the end. By adhering to an intricate planning and methodical due diligence process, you will be able to produce the three most important deliverables that will guide the project: Scope, Schedule, and Budget. Our due diligence is aimed to deliver these findings within 7-10 business days and within a 5-percent accuracy goal of the final result at the completion of the project. A proper due diligence equips our clients with accurate numbers to secure equity partners and lenders and strengthens their position at the offer table. Once the client owns the property, we fine tune the plan one last time and then we execute. A thorough due diligence performed upfront provides the necessary guidelines for all parties involved. Utilize the due diligence process as a time to observe in detail what others usually miss. Done correctly, you will notice a streamlined process that can be applied to any size portfolio. Beyond due diligence, CAPgro provides project accounting and project management throughout the entire project to ensure a successful renovation.
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“The critical components of the acquisition, also referred to as the ‘Triple Constraint’, are the scope, budget, and schedule.”
BUSINESS
The Only Color that Matters is Green
When does “going green” help bring in the green? BY J.T. HOUSTON
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t’s not easy being green, but it sure can be profitable. Trendy, current and issue conscious, going green is a powerful movement in our world. In the renovation world, going green — environmentally speaking — brings in the green. How does the green environment impact ongoing operations and ultimately your return on investment (ROI)? The obvious channels to decrease costs are in electricity, water, gas and carbon dioxide emissions. The simplest and largest impact can be found in lighting alone. By changing everything to LED, you can save money, improve the aesthetic appeal an increase security by allowing more lights on the same circuit. Then there is water. Do anything and everything to reduce water consumption. Select low-flow toilets and showerhead valves. Low-flow toilets can save over three gallons per flush, while low-flow showerheads reduce flow rates down to 1.5 gallons per minute or less, down from the old 5.5 gallons per minute. Reduce the amount of vegetation on property, or even transition to a
“zeroscape” process: removing anything that requires an irrigation system. Go for a more modern, dramatic (and green) look, like a cactus growing out of crushed granite, requiring little to no irrigation. Don’t forget about the windows. Replace single pane windows and look for radiant protection options. Through higher SEER rated unites create a more efficient HVAC system. Finally, there is social impact. All properties being equal, the green effect can drive higher occupancy levels by the perceived value of a decrease in costs. The tenant may even be willing to pay higher rent because of that perception, both internally and publicly, by contributing to a green environment. Give your tenant real cost savings and create a higher perceived value, helping them choose your property over another. All of these green strategies create value to the tenant, the operator and the investor, provide opportunities for potential tax credits, and most importantly, an increase in ROI. And that you can definitely sell to your next buyer.
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IT’S EASY BEING GREEN “There have been numerous studies that have concluded that green multifamily housing properties can decrease overall energy use by 10 percent, decrease building operating costs by 11 percent and also reduce water consumption by 15 percent annually. Furthermore, buildings that have been certified to a LEED Gold certificate consume 25 percent less energy, 11 percent less water and have maintenance costs that are 19 percent lower than buildings without the gold certificate. The tenants in LEED Gold certified buildings are also 27 percent more satisfied than living in other buildings as a result of the sustainable features.” - November 2016 Fannie Mae Green Multifamily Housing Update
BUSINESS
The Alternative Solution
When and why you should consider coating your roof BY KEVIN KIRKWOOD
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f I could impress three points upon you about the roofing business, I would start by saying be intentional and passionate about the culture of your business, determine how to make the end product more valuable to the future buyer, and most importantly, be a trusted advisor to your client. All roofs are not created equally. When a client asks me for roofing solutions, my approach is to advise them on what is best for their roof, whether they want to maintain the existing good condition, repair specific issues, replace, or even retain that building for more than five years. In turn, my mission is to deliver a customized plan that works for their situation. One of the most unique roofing solutions today is fluid applied systems restorative coating. There are several benefits to coating
versus just repairing or replacing. Aside from the obvious insulating and waterproofing, roof coating is low-impact to your business, with the least amount of disruption to daily operations, and it provides immediate results. It offers a high-performance, economic and eco-friendly alternative to re-roofing provided the job is executed with proper expertise. And as long as you have a NDL (no dollar limit) warranty, in most cases the warranty is transferable through the manufacturer. Roof coating increases the value of the property, and there is the not-so-obvious tax write off — effective in the year’s tax schedule. Finally, the amortization over time will show that this is truly a win-win solution for everyone: your client, your investors, and your roofing professional, who is hopefully also a trusted advisor to your business.
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“Roof coating increases the value of the property, and there is the not-so-obvious tax write off — effective in the year’s tax schedule.”
BUSINESS
Less Work for More Payoff? Sometimes you don’t need to renovate 100 percent of a property to be successful. BY J.T. HOUSTON
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o renovate or not to renovate, and how much? Those are the questions. When approaching a major renovation, there’s a myth that everything — 100 percent — must be completed immediately to create the necessary value for the largest return on your investment. However, leaving the last 30 percent of the property untouched, can actually benefit the operator and investor in numerous ways. There are several goals to keep in mind during a renovation, but the most important is to develop a value-add model that creates a return for your investors. Early in the process, it is important to work through the due diligence process, helping determine costs and cash flow available for a specific project. As part of your planning process, examine the first four years, encompassing the post-renovation period, to anticipate the point of maximum value. It is prudent to determine how long to hold the property and when to sell. Minimize initial costs and determine the renovations with the largest impact that will drive the highest rent,
whether that be interior modifications or external amenities. Develop a value-add model and adhere to it to manage expectations and investor relations throughout the proces. Working with a 70 percent model allows you to be successful in proving your project plan since a renovation goal of 100 percent is nearly impossible to achieve. Keep in mind it is critical to maximize occupancy throughout the project in order to stay on budget. Rent pays the note. Typically, investors fund only 70 percent of renovations, with a timeframe of 15-18 months for completion. This timing can be on your side because there will always be a portion of tenants who will maintain their rent, or even pay more, to avoid disruption and inconvenience of moving. In turn, this scenario provides more revenue on those units that were never updated. For this additional reason, it is best to work toward leaving that 30 percent on the table for your next buyer, giving them the opportunity to influence future renovations.
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“It is prudent to educate the client along the way as to how long to hold the property and when to sell.”
INTERIORS
Get Floored
The quiet case for carpet BY LYN JACOBS
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aul Simon said it best in his 1973 hit about apartment dwelling when he urged renters to “remember one man’s ceiling is another man’s floor.” With all the perks of apartment living, there’s no escaping the fact that shared walls can sometimes mean shared sounds or sleepless nights for some unlucky renters. Loud walkers, noisy talkers, and even nervous barkers can dampen the apartment experience for renters. That can leave many property owners floored by bad reviews or low occupancy numbers. Although the National Building Code doesn’t have any requirements for impact sound reduction, it’s becoming loud and clear that even a minimal amount of soundproofing can go a long way in multifamily units.
“It’s becoming loud and clear that even a minimal amount of soundproofing can go a long way in multifamily units.”
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The most effective sound treatments are built into the construction of the subfloor and the ceiling of the unit below. Unfortunately, this is typically only done on modern build projects and is difficult, if not impossible, to retrofit for an apartment renovation. Owners seeking long-term solutions for noise reduction in their investment properties need to focus only on controlling the sounds from above and letting their renters take care of adding soundproofing curtains or other sound-muffling tools to control outside noises. In apartments, there are two types of noise: footfall (or impact) and audible sounds (i.e., voices, TVs, music, etc.). In apartments without a pre-existing sound treatment built in to the structure, the best bet for keeping things
carpet w/ underlay 75-85
35mm concrete w/ 25mm fiberboard 60-65
THE RATING GAME 16mm plywood w/ 40mm x 90mm wood strapping on 25mm mineral fiberboard 50-55
9mm hardwood on 6mm resilient layer 45-50
vinyl flooring 35-40
Nothing is worse than a noisy neighbor, so knowing the sound dampening quality of your flooring materials will keep tenants happy. The Impact Insulation Class (IIC) of a flooring material is measured using a tapping machine with five steel-faced hammers that hit a floor surface. Frequecies are measured and given an IIC rating based on where the evaluated decibel reading from the ceiling/floor assembly falls between 100 and 3150 Hz. On a scale from one to 100, a rating of 50 is considered the minumum IIC rating by the International Building Code.
hardwood flooring 30-35
ceramic/tile/none 28
down is to install some soundproofed flooring to minimize noises from the residents living above or below. Unfortunately the trend toward hard-surfaced flooring, like sheet vinyl or luxury vinyl planks in wood patterns, in apartment communities has amped up the issue of soundproofing. Where carpet historically would minimize sound transference due to the soft fibers and underlying padding, the complete removal of carpeting in apartments has increased the level of noise complaints. Although carpet doesn’t have the same “floor life” as hard surfaced flooring options—carpet typically requires a full replacement every 3-5 years or sooner dependent on a number of factory variables including fiber type, twist,
density, and ounce weight, and resident variables including regular vacuuming, pets, spills, foot traffic, etc.—it is without a doubt the best solution for increasing the acoustic absorbency in a room. Subfloor topical treatments such as sound underlayment pads or mats can only slightly help with reducing sound, and even thicker flooring materials will only result in minimal improvement. Researchers with the Institute for Research in Construction (IRC) recently measured the impact noise levels for a variety of flooring options, giving each option a rating called an Impact Insulation Class (IIC). The IRC found that for residential communities, an IIC of 50 was the minimum rating for occupant satisfaction, where the higher the IIC, the better the
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soundproofing quality of the material. Vinyl flooring earned a rating of 35-40, but carpet and underlay came in well above the average at 75-85 IIC. All that is not to say there isn’t room for luxury vinyl plank (LVP) or other trendy hard-surfaced flooring in a soundproofed apartment. Savvy owners have begun to install LVP flooring on first floor units where there is little need for below ground sound control, and look for more absorbent options in the units above. By utilizing high-desnity carpet in combination with LVP, units can obtain a healthy mix of consumer appeal and long-term noise satisfaction. The combination look gives a condo-style aesthetic while providing a low-maintenance, quiet place for renters to call home.
INTERIORS
A New Place to Hang
Designer closets make a big impact for future tenants BY JIMMY CROTEAU
PHOTOS COURTESY THE STOWE COMPANY
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n a market dependent on hanging on to tenants, the latest renovation trend is all about giving them more space for hanging up. Closet space and designer amenities are little luxuries most potential homeowners or renters aren’t aware that they can afford. But more and more, those few extra square feet and designer touches are making a big difference when future tenants make the decision on where they choose to hang their hats. In the past, kitchens and baths have been the biggest “wow factors” for homeowners and renters, especially since HGTV and DIY networks have become so popular. Today, modern renters and homebuyers have come to expect spacious bathrooms and top-of-the-line kitchens, and rightly so, since both are spaces where people spend the majority of their time living and entertaining. But when it comes to making space for some personality in the home, it’s the little things that can make a big impact—like those which offer a place for everything with tailored nooks, customized crannies and individual racks for shoes or ties. In general, apartments have gotten a bad reputation for having limited storage, often giving tenants little more than two long hanging bars with a wood plank across the top. By providing a shoe rack, sections for shirts and pants, spaces for long dresses, and racks for belts, ties and
scarves, a designer closet actually organizes the space more efficiently and creates more room for other things. Getting the look of a designer closet, like those by Closets by Design and California Closets, or those featured on Sex and the City 2, The Devil Wears Prada, or the Real Housewives series, could end up costing between $1,500 and $2,500 or more depending on the materials used and the features included. But the payoff can be worth the up-front costs considering there are great lower cost options for owners like Easy Track. Walk-in closets with high tech amenities can garnish anywhere between $35-$150 additional rent per month, with most offering a return on investment (ROI) of 100 percent. “A nicely done closet adds much more value than the actual cost of the upgrade,” says Bill Lown, VP of Retail Divison and Business Development of The Stow Company, which is based out of Michigan and has been innovating solutions to home organization for over 25 years. Fortunately, achieving the look is not about calling in name brand designs or rare materials shipped in from exotic destinations. It’s more about the customization and cool features included in the design that set the “wow factor” in place. Imagine how empty nesters would feel about moving out of a residential home into an apartment that is half or less the square feet of their previous house. Not only are they auto-
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matically at a disadvantage from the minimal amounts of space and personality, but they also have to deal with the emotions and stress of downsizing. Now imagine how cool it would be if those same empty nesters discovered their new closet is better than their last one. It may seem like a small renovation in the scheme of things, but it is one huge way of creating the feeling of home for tenants. Hoping to bridge the gap between designer closets and multifamily ROI for owners, Lown is beginning to gain traction in apartment renovation plans. “Owners and managers have learned that upgrading the closets has become a useful tool to resign tenants as well as increase the price of the monthly rate,” Lown sys. “A nicely done closet adds much more value than the actual cost of the upgrade.” Just like any other renovation, the scope of a closet overhaul is dependent on location and demographics. Where properties targeting empty-nesters may need to think about creating his and her closets or walk-in closets with center islands with drawers and shoe storage, properties looking to attract Millennials may want to consider going rustic-tech chic with features like LED lights behind reclaimed wood accents or adding in USB outlets and Bluetooth light fixtures. A renovation should always help eliminate the “cookie cutter” mentality that has previously been associated with apartment communities, and, ultimately, caring about the little touches like storage and personalization will work wonders in creating the feeling of a home for tenants.
PROTECTIONS
Y T N A R R WA
Weighing the Options
What’s the difference between a manufacturer warranty and a contractor warranty? BY KEVIN KIRKWOOD
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aving a roof that has an NDL (No Dollar Limit) warranty is not only a smart move when selecting a roofing contractor, but it is also transferable in a transaction, thus increasing the overall value of the asset. When selecting a roofing company for your next roofing project, select one that not only has credible references, but one that offers an NDL warranty as well. The stated manufacturer warranty is the standard, pro-rated warranty that can usually be printed from the manufacturer’s website; it covers materials. There are two kinds of contractor warranties offered by roofing contractors and they are vastly different: the labor warranty and NDL warranty, which covers both materials and labor. A labor warranty is only sound as long as the contractor
is keeping his or her word. And you can only hope that the contractor is still in business when or if an event occurs that would call in the warranty. In most cases, a labor warranty is not transferable from one asset owner to another. An NDL warranty, on the other hand, comes in 10-, 15-, 20- and in some cases 25-year material and labor warranties. This simply means that even if the contractor does not honor the warranty, the manufacturer will cover the cost of the material and the labor to repair at their expense. This type of warranty is obliged if there is a default in workmanship and/or materials. In order for a contractor to offer an NDL warranty, he or she must be certified and in good standing financially with the manufacturer.
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“And you can only hope that the contractor is still in business when or if an event occurs that would call in the warranty.”
PROTECTIONS
How does insurance play a role in apartment renovations? Make sure to take these steps when hiring a general contractor. BY STEVE DELEON
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ith the need to be as efficient as possible, many asset managers or property owners end up using general contractors (GCs) who are less qualified, financially strapped and/or underinsured. But that’s a big mistake. Things can always go wrong with a project. To help prevent a financial catastrophe, you need to use a reputable, financially sound and properly insured general contractor. To weed out the unqualified or less reputable GCs, ask for a list of comparable projects they have worked on that have a similar scope, city or state, and/or cost and timeline as the project you are asking them to bid. An inexperienced GC can run into several costly lessons during a job concerning regulations, geographical unfamiliarity and increased costs. Financially sound GCs usually have a great relationship with a surety carrier. Most will have a surety line with a single job maximum and a total bondable aggregate. General contractors can ask the surety carrier (not agent) for a letter showing their ability to bond.
Even if the job isn’t going to be bonded, it is a good way to check the financial standing of a general contractor. Properly insured general contractors are a must. I have seen “Certificates of Insurance” look like they show the right coverage, but then you find out in a claim situation there was no coverage at all. That’s why vetting your GCs are so important. Ask them to show you all forms that apply. Make sure that failure by subcontractors to have coverage is picked up by the general contractor’s insurance coverage. You may have a contract in your hands that says that’s the case, but if the general contractor’s insurance policy doesn’t cover the subcontractors, you are left counting on the GCs to cover out of pocket. Also, make sure the GC has pollution liability insurance. All of the commercial, general liability policies will exclude pollution, so it is important that the GC provide pollution insurance coverage for the possibility of bodily injury or property damage caused by mold, release of asbestos or any other pollution incident.
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“An inexperienced GC can run into several costly lessons during a job.”
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PROTECTIONS
What does waterproofing really mean?
You’ve heard it said countless times, but do you know what it actually involves? BY KEVIN KIRKWOOD
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aterproofing is the process of making building structures and objects water-resistant so that they remain relatively unaffected by moisture intrusion. Waterproofing helps maintain structural integrity, protect the building’s contents and create a controlled environment inside. Failed waterproofing is one of the leading causes of structural damages. If water gets inside a building, it can deteriorate the foundation, lead to mold growth in the walls, negatively impact your air quality and even cause bodily injury in the instances of water-damaged decks or balconies. The waterproofing process is done by applying coatings or membranes to building materials such as the roof, siding and foundation. Waterproofing materials vary by area of application, but some common materials used in coatings and membranes are rubber, asphalt or polyvinyl chloride (PVC), among others. Today, polymer-based materials are
popular as they adhere tightly and seamlessly to the structures they envelope. During the past 10 years, the technology in waterproofing in the construction industry has advanced tremendously to include integral waterproofing, which is designed for concrete structures. In this process, waterproofing materials are mixed directly into the concrete, preventing water from passing through it. This is achieved in one of two ways: either hydrophilicly, wherein the water in the concrete is replaced with insoluble crystals, or hydrophobicly, wherein the pores within the concrete are blocked with fatty acids. An important thing to keep in mind is that roofing and waterproofing are not the same things. However, some of the top commercial roofing companies offer waterproofing as a service. To ensure your building is properly waterproofed, hire the services of a certified waterproofing consultant. It is a worthwhile investment.
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“Failed waterproofing is one of the leading causes of structural damages.”
MAXIMIZE THE VALUE OF YOUR PROPERTY
Put the strength of HD Supply Facilities Maintenance behind your next property improvement or renovation project. From on-site consultation, to product selection, to labor and installation services, you can trust HD Supply to help you get the job done on time and within budget.
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HOW TO
This is why you should do an Occupied Renovation
What’s good? What’s bad? And the big question: What’s the return? BY KYLE WEAVER
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ccupied unit renovations are where champion renovation companies are made. They are challenging. They are risky. Most contractors do not want to do them. An occupied renovation is a good option for certain renovation plans because it displaces residents only during their working hours. When they return at night, we ensure they have a livable space with working appliances, a countertop and area where they can cook. They also have a working sink, shower and toilet. We take into account that we are affecting the homes and lives of those who live there. This presents unique challenges and unique opportunities to transform both the unit and the lives of the residents. Sequencing is critical to an occupied renovation strategy, focusing on different types of construction each day in order to get a unit fully turned in four or five days. A typical work
schedule might be demolition and reinstalling countertops, cabinets and plumbing fixtures on the first day, painting and drywall repair on the second, installing the flooring on the third, completing work on the shower on the fourth, then finishing the project on the fifth. When people return each night to their homes, they clearly see the improvement. If an occupied unit renovation is done correctly, you minimize the disruption to the daily lives of residents. We take this very seriously and measure our success accordingly. As a property owner, there are cost savings with an occupied renovation because you do not have to sacrifice rental income from an empty unit during the renovation. On certain scopes of work involving rough plumbing or electrical, you cannot keep people in their units. However, if it can be done, we will do it. If the scope of work is feasible enough to do it, an occupied renovation is ideal.
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“Loving it! Every worker was considerate, kind and knew what they were doing and went on to do it professionally.” -Peggy Alston, satisfied resident
HOW TO
Meet the Moneyman
Advice on how to get the best apples-to-apples bid comparison BY RYAN CUMMINGS
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aste makes waste. To ensure you are getting the best price for your renovation, the most important first step is to identify the scope of what you want to do. If you are not sure what needs to be done on your property or do not have the expertise, solicit help from a qualified contractor that you trust. When you are soliciting bids, don’t overdo it. There is no need to get 10 separate sets of eyes on something and 10 separate interpretations of what needs to be done. Be careful creating a situation that is more confusing than helpful. Anything more than three or four bids is overkill. You are going to get a good cross section with three or four and that should give you a good market rate. The biggest mistake people make is not properly vetting or qualifying a contractor. This is crucial to make sure things have not
been missed, left out, or something is included that is not needed. It is also not a good idea to take only the lowest bid without vetting the company and making sure it has financial stability. If you know the company, have a history of working with them and it is the lowest bid, that’s a great option. You know what you are getting into. If the low bid is from a new group, you need to do your research. Ask them for recommendations and request to see a project they have completed. Construction is not theoretical. There is a physical, tangible product that is produced. To get the best price, it all starts with vetting and qualifying the company and making sure there are no surprises before you make a commitment. You don’t want anyone to go forward with work without understanding the associated costs. Failing to do so could cost you far more than you ever imagined.
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“Construction is not theoretical. There is a physical, tangible product that is produced.”
ASK AN INSIDER
Water and mold, hail or fire; make sure you are covered.
Know the Steps
Steve DeLeon tells us how to make an insurance claim and get the most out of it, and why being prepared before an event is essential in order to maximize your return. What’s the primary piece of advice you’d give to people who might need to make a claim? “Prior planning is extremely important. Know your risk tolerance. In other words, if you buy an insurance policy and you have a wind and hail deductible of, let’s say, $25,000, so many people only see that and don’t pay attention until claim time. Then they see it and say, ‘Oh my gosh, $25,000, I should have budgeted that in.’ Understanding your true risk tolerance for deductibles is incredibly important for your planning.”
or minimize loss from happening. There’s a lot of common sense, but there is also wording in the policy that talks about preserving property.”
In the event of a claim, what are the procedures to take? “First and foremost is preservation of property. When an event happens, it’s the responsibility of the insured to take appropriate measures to minimize damage to the property. If you have hail damage and a hole in your roof and water is coming in, you have to do what you can to get property out of the house. You can’t just cross your arms and say, ‘oh well, insurance will handle it.’ ” So you have to be proactive in the process? “Exactly. Preservation could be as easy as, ‘hey, take out that couch and try to let it dry out.’ That’s preserving it. That’s helping your cause. You don’t have to wait a week for the adjuster to come.” What are some other ways people can make sure they’re fulfilling the policy requirements? “Preparation. For instance, in Florida, if a hurricane is approaching, people would try to preserve or prevent loss on their property from happening ahead of time. Boarding windows. Moving items to safe locations. That kind of thing. Any measures you could take to prevent
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Basically read your policy? “Yes. Familiarize yourself with it. Find out what your responsibility is as an insured. People are frequently unfamiliar with it. Maybe it’s because a lot of agents don’t know it themselves so they don’t talk about it themselves. They don’t discuss everything a policy entails. An insurance agent could be more technical or more sales-side. If you get technical-type agents with a lot of knowledge, they understand all those ‘gotchas’ in the policies. But then you have more sales-types and they don’t understand the policies as well and they don’t explain the things we’re discussing right now. Preservation of property, deductibles, how to make claims and so on. Make sure you’re well versed. That’s the best insurance. And it’s important to know the steps on how to make a claim.” And what are the immediate steps? “When an event happens, first thing is preservation of property. Step two, notify your insurance agent immediately. Step three, be in contact with the actual adjuster from the insurance carrier for authorization of expenses. That adjuster is going to give you a little leeway on the first expenses on preservation, but outside of that he or she has the authority to say yes or no. Those are the first steps of the claim. Then, when a claim is up and going, go to your arsenal of good, reputable contractors that you have known or used or vetted and be ready to get quotes so you can match up to your adjuster’s estimate. The bottom line here is be prepared. Don’t wait until the event happens to respond. Be prepared for the event, then you’ll have all the tools to respond.”
ASK AN INSIDER
Selecting the Right Match
Robert Black, a veteran in the field of construction and renovation, explains how to identify, interview and hire contractors to ensure your comfort level. Let’s start at the beginning. How do you identify contractors you might hire? “Selecting a contractor is complicated. Back in the day you’d literally go to a phone book and start making phone calls. Now things are more sophisticated with the internet and different search options. If I’m doing a job in a market I’m unfamiliar with, I’ll reach out to people in that market. If we’re buying an apartment community in, say, Minnesota, I’ll reach out to the property management team and ask for references for roofing or various contractors. If they know, great. Very often they do. You look for some type of reference. What was that experience like? Was it positive or will this person fall on his face? That’s the first step.”
ILLUSTRATION BRIAN SMITH
What if that doesn’t work? “Go online. Start doing Google searches. Who does roofing in a certain area? What kind of materials do they work with? What kind of reviews have they gotten? And you can also go to the site and start asking around, but that can be time consuming and not very effective.” How many contractors do you try to identify in the initial stages? “We look for at least six – but seven or eight is better – that are qualified to perform that particular task. Let’s say roofing. A lot of those guys will fall off through the course of conversation. So you weed some out. Maybe you end up with four or five that you’re initially comfortable with. Some of them might not bid. They might look at the workload and the
time required and they might say they can’t do it. So you’ll lose a couple along the way.” What’s the optimum number as you continue to whittle down prospective contractors? “Three. Three is the magic number for bidders. That’s usually the best. That’s when you start the interview process.” What preliminary steps do you take for the interview process? “Go online and look at the website and do research about the company and their style of operation, their finances and feedback from people they’ve done work for. That’s when you want to start talking to people at the company. You want a comfort level. You ask a bunch of questions about how they’ve done jobs in the past, how they’d do this job, and whether that tracks with what they’ve told you and what they’ve put on their website. The comfort level is key. If you have it, you ask them to bid.” Any other essentials in the interview process? “Visit their place of work. That’s important. If I’m looking for a roofer, I want to see their operation, their trucks, meet their people. I want to know that they’re going to do the work themselves and not subcontract it out. And I want to know how they manage projects, what kind of software they use, how organized they are and how they schedule things. Again, comfort level is key before you go under contract.”
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ASK AN INSIDER
Calling All Townsmen
Senior national account manager Ryan Cummings explains when and why to have a town hall meeting before renovating. Why would someone hold a town hall before renovations? “We mainly do them when we have occupied renovations because there’s a real need to communicate with residents because we’re entering their homes. We want to be respectful of them so they know what to expect and put their mind at ease. The owner is spending money to improve their homes. The meeting will make them more comfortable with the process.”
to work positively with the on-site management team. Many times, our planning has been done with someone on the management team but not someone at the property level so this ensures that everyone at the property understands our plan and that we fully understand their expectations. It helps put faces to names. It’s easy to get frustrated with a faceless thing. But when we’re all people, it helps everyone. Communication, interaction and a personal touch is good for everyone.”
Aside from internal renovations where residents might have work happening in their homes, are there other opportunities to hold a town hall meeting? “It is always a good idea to over-communicate with the residents but by far the most attended town halls are those to do with renovations that involve us entering their home. Some of the other opportunities can be exterior painting/repairs, parking lot re-stripes, and re-pipes. The process always helps us earn more of a buy-in from the resident, which leads to a smoother renovation.”
How would you go about holding a town hall meeting? What are the steps? “Typically you work with the site staff. Sometimes they’ll have a monthly meeting where they’ll have an officer come and talk about safety. You can piggyback off of that. If there’s something already scheduled with residents, that helps ensure turnout—something at a facility meeting place like a clubhouse. You can add the town hall onto those pre-existing events. Site staff will usually put something out where they’ll say ‘here’s the date, time, and who will be addressing you.’ Then we bring food and drinks and show up with a smile and go from there. Come sit down, ask questions, and we have a presentation for you. Again, the personal touch. It helps set the tone for the upgrade that’s occurring.”
Beyond communication with residents, what are the advantages? “For starters, it often serves as an initial step that allows our team
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R E N OVAT O N S 30
THAT STAY ON PAR Knowing How Far to Take Your Renovation to Ensure Sustainable Investment BY DREW KIESLING
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When it comes to renovation for the sake of resale value, the most important thing to remember is that you are not smarter than your market. It is that simple. Think of the market like a golf course. You may think you have a new, brilliant approach that will get you to the green in ways the course’s designer hadn’t imagined. The fairway is laid out as it is for a reason. A contractor I knew was working on a largescale renovation of some apartments a few years back. He was sure the apartments he was renovating would be cutting edge in his market. He went through the whole facility and hardwired iPod connectors in every room throughout the unit. Just one problem: Bluetooth technology was invented soon after. Apple changed their connectors. All of that technology went to waste. Another guy saw himself as a true artisan. While renovating a property, he went out and imported custom-made pendant lighting and hand-made planters for the exteriors. The whole thing was done tastefully, with beautiful, wellmade pieces. Tenants, however, balked at the idea of paying more rent for these upgrades.
The mistake these renovators made is that they did not truly understand their market. There is nothing more important to renovation strategy than understanding your market in the beginning and where you want to stand when it is time to sell. There are markets for apartments with top-of-the-line pendant lighting and custom planters. There are also markets that will simply not reward the inclusion of these types of upgrades. If you want to ensure that you are getting in and out at the right time, you need to do the research. The first thing you need to do is figure out where you stand in the submarket you’ve chosen. That means field research. Take some time to go around to all your possible competitors and find the status quo. Ask yourself questions. What works at the best facilities and what doesn’t work at the worst? What are competitors charging and for what? What are these competitors doing to set themselves apart? Next, decide where you want to end up within
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BEWARE THE FUTURE Wanting to add the latest and greatest in design and technology to you propery can be tempting. But, beware of fast-moving technology, which could render today’s upgrade obsolete tomorrow. Recently, Apple dropped standard USB ports from their computers, ushering in the next generation of connectivity: USB-C. Although still not widely supported, shifts in tech like this can make or break your budget and appeal to potential residents.
“There is nothing more important to renovation strategy than understanding your market in the beginning a and where you want to stand when it is time to sell.”
your submarket. Maybe you’ve found that rent in the area ranges from 90 cents to $1.20 per square foot. Think about the difference between the two. As a renovator, you’re probably buying a lower performing property. Figure out what it is that separates the $1.20 unit from the 90-cent unit. What does the $1.20 apartment have? Maybe it has granite countertops, hard-surface flooring throughout, stainless steel appliances and recessed can lighting instead of the usual flourescent. Ask yourself: am I willing to do absolutely everything this facility is doing in order to get to that price point, and at what cost? You need a goal. Maybe you just want to get to $1.10 per square foot instead of being at the top range of pricing. What changes can you make at minimal cost in order to get to that price point, even if you’re not going to do the fine-pointed, nitty-gritty work to get to $1.20? What are the easiest, most cost-effective renovations you can make in order to drive the most possible rent increase? This is what sustainable investment is all about. When you are asking which renovation to focus on, remember the potential tenant, and remember the very specific context for the
tenants you want. You’ve done the market research. You know what people in the area are willing to pay, and what they want to pay for. You also know that, for the most part, the tenants in these units are not looking as closely at quality. Remember our friend earlier with his imported pendant lights? Tenants are looking for spaces that feel fresh and inviting. They are not necessarily focused on every detail. First, think about paint and flooring. They seem basic, but it is easy to overlook the power that a smart paint job with a fresh, hard floor can have over a potential tenant. Remember, what you are trying to do in this renovation is tap into the visual responsiveness of the impulse buyer. It’s all about look. Use your paint and floor to stay in the fairway. Consider adding an accent wall in each living area that is a shade or two lighter or darker than the rest of the room and replacing the carpet with inexpensive hard-surface flooring tenants desire. Even if you’re just using laminate or vinyl planking, hard flooring screams “EXPENSIVE” to the potential tenant. A room with an accent wall and hard floor will stand out in the mind
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of potential tenants over the single-color walls and floors they will see elsewhere. Also, use small details to your advantage. Remove hanging lighting in order to create a bigger-feeling room, and use a grantie-like material or quartz for your countertops. Tenants may not know the difference between high-quality cabinetry and more basic cabinetry, but they will always appreciate that their drawers and doors have modern-style sleek handles, which are a very cheap, simple visual cue. In restrooms, try framing mirrors or installing a curved curtain rod. They add a modern feel with very little work. All in all, you must remember to not outthink the market. It’s a cliché, but it’s true: the customer is always right, and what customers want is simple, clear clues that the space they are moving into is inviting, modern and fun. You want walk-up appeal on a budget in order to bring up rent as much as possible. If you do the proper research, you will find that smart, attractive renovation investments will yield huge returns to the bottom line. You will stay in the fairway and out of the rough.
You don’t have to break the bank to create an expensive-looking kitchen
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How to Fake an Expensive Kitchen BY JIMMY CROTEAU
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n apartment is only as nice as its kitchen. Nowadays, tenants expect their kitchen to look like the kitchens they see on HGTV and in new homes. But how can you provide that experience for the everyday person walking into a new apartment? The first thing a tenant—or potential tenant—should see is cabinetry that immediately tells them they’re standing in a well-crafted kitchen put together by somebody with an eye for detail. We want potential tenants to sense openness, cohesion and brightness. It should be a space they will picture themselves cooking in from the moment they walk in. A great way to achieve that sense of openness and brightness is to avoid the feeling of being separated from the rest of the home. If
“If you have a little more in your budget, quartz is another great product to consider for countertops. Quartz also tends to bring more of a classic look: muted, elegant and solid.” PHOTO, PREVIOUS SPREAD SCOTT WINTROW/GAMUT PHOTOS PHOTO, THIS PAGE DAVID HALLORAN
you have a chance to remove upper cabinets at a pass through, do it. By removing them you will take 10 years off the look of your kitchen. Keep the colors of the walls bright and the countertops light as well. Get creative with color on the cabinets; they don’t have to be wood grain anymore. For example, paint the upper cabinets white and the lowers gray or vice versa to really spice it up. Cabinetry is often a missed opportunity to make the kitchen look incredibly expensive, even when it isn’t. If the cabinets in the kitchen you’re renovating are hindering your ability to create an amazing-looking kitchen, consider changing their fronts or removing them entirely. Today’s tenants are looking for trendy flat-panel doors with hidden hinges, not the espresso doors and brass hinges of days past. The fix is simple: remove the doors from the cabinets, then paint the cabinetry and replace the door or drawer fronts with the fronts your tenants are looking for. Or if the cabinets are
Creative backsplashes and walls add texture and help fake an expensive kitchen
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Remove overhead cabinets to open up the bar, making the kitchen feel larger
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“Finally, remember to use what you’ve got to create a space that seems more expensive than it actually is.”
simply beyond repair, you can remove them entirely. Granite countertops immediately impress tenants. They’ll want to see an undermount sink and expansive sections of granite. That is certainly achievable, particularly if you opt for 2-centimeter cuts of granite, no laminate edge and forgo the decking usually used as well. If you have a little more in your budget, quartz is another great product to consider for countertops. Quartz also tends to bring more of a classic look: muted, elegant and solid. I like to use white quartz with just a whisper of sparkle in many kitchens. Granite can’t look like that. Backsplash is also a powerful place to use your creativity in order to fake an expensive kitchen. If you do decide to go with quartz or granite countertops, you can easily save money by skipping the typical 4-inch backsplash and use that money to dress up your wall with subway tiles or mosaics. They’re thin and light, and the possibilities for patterns are endless. The patterns will draw eyes and add texture to the kitchen. Another fantastic option for backsplash is to use vinyl floor planking. You can paint the wall behind the backsplash straight black, then apply distressed looking off-gray vinyl planks, leaving about a quarter of an inch between planks to show the wall. The planks give extra depth and texture to the room in a way that tenants love. It’s another layer of elegance at an extremely low cost compared to traditional options. Vinyl planks’ usefulness is limited only by your imagination. You could attach them to the wall in any pattern you can think of: herringbone, parquet, brick-style, or diagonally. Vinyl planking is low cost, easy to install and looks terrific however you use it. Open shelving is incredibly popular right now and will only add to the airy sense of openness you’re working to create in the kitchen. Once you’ve got the look you’re going for in the kitchen, remember to light it in a way that highlights the work you’ve done in creating the sort of open environment your tenants have been looking for. The standard 4-foot fluorescent cloud lighting is ugly. If you’re looking to create the appearance of an expensive kitchen, there are far better options. You’re looking for lighting solutions that will create brightness and will play nice with the openness you’re creating. One solution I’ve used is to install flush-mounted LED can fixture lights, recessed
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into the ceiling. It’s a simple installation and is a graceful way to create the bright light you’re looking for. As for appliances, save money by coordinating the appliance color with your cabinet color. For instance, if you have all white cabinets, save money by using all white appliances, it’s a modern, clean look. While it doesn’t seem as expensive as stainless steel, using all-white appliances creates a cohesive room and brightens it up as well. With all white, you’re building a feeling of cleanness and elegance into the kitchen. Finally, remember to use what you’ve got to create a space that seems more expensive than it actually is. Many apartments include some sort of bar area that allows people in the kitchen to see out into what should be a dining room. But depending on your resident, it really determines what this room can be or will be used for. For example, in my house my family lives at our island bar top. We have converted our dining room space into a sitting area so when we entertain there is a place for our guests to relax while the meal is being prepared. Do everything you can to open up that area as well. If there is cabinetry blocking the view, remove them. That will create a way for a busy parent to supervise the children, or for a person in the kitchen to keep an eye on the football game on the TV in the living area. Remember that you can also reserve these strategies for the specific places they’re most needed. If you’ve got a three-story apartment building, try spending some extra time in the kitchen on those third-floor apartments. Maybe the apartments on the first two floors have white appliances and granite and the third floor has an upgraded appliance package and quartz. Instead of asking your tenants to walk up two flights of stairs to get to the same apartment everybody else has, make those higher apartments into penthouses. Give them the stainless steel appliances and distressed faux-reclaimed wood backsplashes. You’ll create a vibrant market for what are typically the hardest apartments to fill. Creating the look of an “expensive” kitchen doesn’t mean you have to go out and break the bank on your own. For the most part, “expensive” actually means having an open feel, bright colors and a cohesive sense of place, all of which is achievable at minimum expense to the renovator.
PHOTOS SCOTT WINTROW/GAMUT PHOTOS; DAVID HALLORAN (2)
Recessed lighting, stainless steel appliances and bright granite countertops all help to achieve the expensive kitchen look
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CURB
CHECK Kick boring to the curb and make sure your property shines from the street. BY JIMMY CROTEAU
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First impressions are powerful. For potential apartment renters, the curb appeal of your property can make or break their decision before they even get out of the car. When it comes to creating curb appeal for your apartments, the most important thing to remember is that there are always more apartments, usually within sight of one another. Why should a potential tenant choose your location instead of the one across the street? What can you do to make sure that the future resident’s attention is on your apartments instead of the ones next door? The answer is simple. You must define your space. When your potential tenants look at your facility through the window of a car, it’s pivotal that what they see suggests a distinctively inviting living experience that they just can’t get anywhere else. So let’s start creating that experience and defining your space with a few simple tricks of the trade.
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Signage
It’s important not to cut corners here. After all, this is your calling card, the first thing your future resident sees while driving to work, walking their dog and approaching your property. Inexpensive vinyl signs or dilapidated and faded monuments will do nothing but make your property feel like those signs look. Curb appeal is all about creating interest, and blending in is not interesting. Consider investing in a metal, laser die-cut sign. Keep it simple and elegant, and, if local laws allow it, display it in a creative way such as on standoffs on a brick wall. Remember, by elevating your sign, you’ll draw viewers’ eyes upward. They’ll see more of your property, and if your signage is done elegantly and appealingly, viewers will be impressed and drawn to your property. Another possibility is to incorporate your signage into some sort of structure or monument. Incorporating advertising signage into a statue or a fountain, for instance, will create texture for your property in a way that is missing from many complexes. Make sure that you landscape and keep this area fresh and seasonal. That attention to detail will make your facility feel like a gated community, even if it isn’t.
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Paint
Whenever a property changes hands, a face lift is the first order of business. The paint changes color and for good reason. First, the new ownership always wants to put their personal stamp on their purchase. Second, you want your current and future residents to know there is a new, better property manager in town. Crucially, everyone will notice the change, which is a great way to advertise. It’s vitally important that the paint on the outside of your apartment adds to the unique experience of living there, and that it adds to that experience by contributing to an overall theme without distracting from the concept. When your potential tenants first see your buildings, the buildings tell them a story. Colors should be on trend and timeless. They should accent the distinctive features of your space without becoming distracting. Paint can even be used to dampen distinctive features that might have been seen as trendy in the past. In the 1980’s, stucco belly bands were enormously popular. You still see them hugging
homes and apartment buildings to this day. However, when a potential tenant sees one painted in contrast to your walls, they think of the ‘80s, and you’ve lost an opportunity. Try painting that belly band with the same color that you’ve used on the rest of the walls while also drawing attention elsewhere. This way, a potential tenant doesn’t look at your building and think of Cabbage Patch Dolls and Star Wars; instead, perhaps the eye is drawn to the exciting and on-trend brightly-colored door. Using the right paint color can send eyes anywhere you’d like. If your buildings have beautiful, intricately crafted arches above each window, draw the eye there. Maybe most of your building is gray, but the arches are painted white. There is always the danger of going overboard on this idea. If you use too many colors on a building, the concept is muddled. Your eyes don’t know where to focus. If you keep your color choices cohesive and smart, your apartment will pop out from the background and give you an extra advantage over the complexes around you.
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“You want your current and future residents to know there is a new, better property manager in town.”
Amenities
Now that you’ve got a smart, well-deployed sign drawing the eye of the potential tenant over your cohesive, timeless paint job, you’ve got to show the tenant that he or she will love living there more than anywhere else. How do you do that? You put the perks out front and in plain sight. If your complex has a dog park, make sure that it’s identified so your potential tenant can see the dozens of happy-looking people walking their dogs on a breezy summer day. If you’ve got a pool, make it prominent and obvious. There are limitations here, of course. You don’t want the toddlers’ playground bordering a busy road, for example. Let people see what living on your property could be like. Bonus points if you can stand out from the surrounding apartments at just a glance. If the complex across the street has a dog park, install a washing station in yours and put it right out front. The idea is that you want people to learn everything they could learn about your amenities — and how they compare to others’ — just by driving past. Finally, a word on promotions. They are a necessary evil, but never forget to define your space. Try to limit the use of the same advertising gimmick day after day, week after week. Mix it up with a cluster of balloons out front one day, a nicely done banner another. Make potential residents read your message, not become numb to seeing the same balloons day in and day out. Remember, these future residents most likely drive by your property multiple times every week. By changing your promotional marketing displays, you draw the eyes of potential renters to your buildings. There is nothing more important than looking unique.
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NEW AGE IMPROVEMENTS TO OLD-AGED UNITS Building Portfolio Managers Incorporate StratIS Technology into Retrofits BY JR BOLOS
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We assume wireless energy management and control systems are reserved for new construction. Not so, says Felicite Moorman, CEO of Philadelphia-based StratIS. A specialist in a field created to meet the need of cost-effective wireless conversions in multifamily, multi-use and student housing, 90 percent of StratIS installations are retrofits, according to Moorman, and the numbers keep growing. “A building that is 50 years old can be completely changed over in just a few days,” Moorman explains, citing door locking mechanisms that have not changed significantly in more than a century. “Electronic door locks are essentially the same hardware, so it is just like changing a locking mechanism.” The obvious return on investment (ROI) is impressive. Traditionally, when a tenant
moves out, the lock is physically re-keyed to provide security. The StratIS control system only requires a simple re-program of the locking mechanism. Anyone in the leasing office can re-key the existing lock in less than a minute while sitting at their desk, reducing labor costs. The new tenant receives a smart card similar to a hotel key card. If the tenant misplaces the smart card, a new password and card are easily replaced. Additionally, because the smart-card communicates directly with the locking mechanism, most do not have to be extracted to work. “Because there is no new hardware or additional maintenance costs,” Moorman asserts, “Our typical retrofits in buildings with an average of 250-300 doors begin seeing ROI within two years at most.” Thermostats are often as simple to replace
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Portfolio-wide Dashboard Control
Remotely Manage Access and Energy for Buildings & Units
Increase Net Operating Income
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as door locks, again due to previously stagnant hard-wired technology. “The sky is the limit where energy savings are concerned,” says Moorman. “When you save 20-30 percent building-wise, it also provides a huge carbon savings. For the first time multifamily buildings can benefit from and promote an environmental mission.” StratIS says ROI on wireless thermostats typically begins between 18-24 months after an installation, depending on the complexity
of the operation. This Wi-Fi-based nucleus also allows tenants to add peripherals such as lighting and music easily, amenities that allow older buildings to compete with new builds where such conveniences have become standard. App fatigue has become a significant challenge for users who convert to electronic appliance and utility management. “Because a resident will use our app to open the door, it will be a front-page app,” continues
“We love using StratIS at our large property! Making iButton keys is so easy and effortless. We never have any problems and residents love the new and up-to-date technology we offer with these awesome keys!” -Ashley Stockham
Leasing Consultant
Moorman. “They can use this app for everything else in their [phone] because it is integrated. You can even use it for Amazon Alexa!” “This is really a great opportunity to sticky up the electronic ecosystem in retrofitted multiunit buildings,” the StratIS CEO concludes. “Residents feel they are living in a modern environment. Maintenance can reset and make other adjustments to security systems and other utilities from a central location in mere minutes. It’s clearly win-win.”
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Leading to Win:
Extreme Ownership Muster Who Better than Former Navy SEALs to Help Your Business with Leadership Skills? BY STEVEN KIRLIN
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It’s 4:30 a.m. in San Diego. Outside the Omni Hotel, 200 conference attendees are getting acquainted, stretching, nervously laughing, and waiting. We are waiting to workout. This is not a CrossFit convention. It is a business leadership conference. In the darkness, we wait. We are up before our enemy, a key principle we will learn from Jocko Willink and Leif Babin, decorated former Navy SEALs and founders of Echelon Front. While these early morning workouts are optional, they don’t feel that way. 4:30 am. This is crazy. Yet, I want to be here. There is an eagerness and competitiveness in the air. Excitement. Tension. Good. Over the next two days, we peer into the battlefield experiences of these men and engage the principles learned to our own business
situations. This real-world, tactical training is uniquely different than leadership cheerleading. We are not here to feel good but to get better. The successful release of their #1 New York Times best-selling book, Extreme Ownership: How U.S. Navy SEALs Lead and Win, and rapidly growing experience in corporate leadership development has brought us all here to the inaugural Extreme Ownership Muster. Represented are 42 U.S. states, four foreign countries, and 56 industry leaders (and aspiring leaders) at every level joining together to develop their leadership capacity. Something is different here. People show up ready to learn and do not leave early. Extreme ownership is about owning the problems you face in business, for yourself and
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for your team. It is about owning the solutions to those problems, the execution of plans, and the results. This type of leadership is bold, but there is no room for ego here. Ego blinds you. The best leaders are humble and strive to get better. Together we unpack the Laws of Combat (Cover and Move, Simple, Prioritize and Execute, Decentralized Command) in both military and business situations, learning to process our experiences through this new leadership paradigm. We are ready to lead. We are ready to win. It is now time to take on our own unique corporate battlefields. In 2017, Echelon Front will host two Muster events: New York and San Diego. To learn more, visit www.echelonfront.com.
“This real-world tactical training is uniquely different than leadership cheerleading. We are not here to feel good but to get better.�
ABOUT THE BOOK In Extreme Ownership, Jocko Willink and Leif Babin share hard-hitting, Navy SEAL combat stories that translate into lessons for business and life. With riveting first-hand accounts of making high-pressure decisions as Navy SEAL battlefield leaders, this book is equally gripping for leaders who seek to dominate other arenas. Jocko and Leif served together in SEAL Task Unit Bruiser, the most highly decorated Special Operations unit from the war in Iraq.
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O n Yo u r Way O u t
The Dangers of Duct Tape “All you need is duct tape and WD-40.” -Unknown BY STEVEN KIRLIN
ILLUSTRATION KYLE T. WEBSTER
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or generations, project managers and subcontractors have lived by the above axiom. Call it “value engineering.” Call it $7 at Home Depot. The gooey tape. The magical spray. These folkloric products never fail us. Well, not until irate clients call from their bathrooms with their pants around their ankles. We’ll mask the name of the renovator involved to protect, well, the guilty. Let’s call this former colleague of mine Doug (names have been changed to prevent comical shaming by co-workers). Like many of us in this industry, Doug is an adrenaline junkie, thrilled by the pressure of meeting deadlines that were perhaps not grounded in reality. In the value-add business, this stress is compounded by the buzz of a phenomenon known as, yes, value engineering. It’s one of those amorphous terms that mean different things to different practitioners. But it shouldn’t mean duct tape.
So not long ago when Doug was on a job where the client needed a clubhouse bathroom done today—why is it always today?—he turned to his handy roll of duct tape to secure a toilet paper dispenser to the wall. Really, what could go wrong? It only needed to hold until the new part came in. The victim was innocently reaching for some two-ply when the dispenser collapsed from the wall, revealing Doug’s dark secret in the form of exposed strips of duct tape. He received a call from the property which was not pleasant. Then came the picture of the disaster. “The gods have lied to us,” Doug surely thought. Duct tape does not hold everything. Doug fixed it, of course, repairing a relationship with our client, which was almost flushed. But we all learned something that day. About ourselves, about value engineering and about duct tape.
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“The victim was innocently reaching for some two-ply when the dispenser collapsed from the wall, revealing Doug’s dark secret in the form of exposed strips of duct tape.”
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