Colorado Rental Housing Journal August 2014 by Professional Publishing, Inc

Rental Housing Journal Colorado

August 2014 - Vol. 6 Issue 8

2. Fed Chair Says a Mouthful to Property Owners and Managers

4. Campus-Style WiFi Systems: The Amenity for Today

3. Dear Maintenance Men:

5. 23 Property Management Tips for Mastering E-mail

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Monthly Circulation To More Than 7,000 Apartment Owners, Property Managers, On-Site & Maintenance Personnel

How-to Guide Helps Housing Providers Implement No-Smoking Policies

he Group to Alleviate Smoking Pollution (GASP of Colorado) has released the 2014 Colorado Guide to Establishing No-Smoking Policies in Multiunit Housing. The free 12-page booklet is a valuable tool for property owners and managers who wish to implement no-smoking policies in their communities. Peer-reviewed by housing providers, the guide includes information about the economic benefits, implementation and compliance techniques, and other helpful resources. It is endorsed by the Colorado Housing and Finance Authority, Colorado Division of Housing, Colorado NAHRO, Housing Colorado, Rocky Mountain AHMA, Apartment Association of Southern Colorado, and the Rental Housing Journal. The guide can be ordered at ordertheguide.org or by calling GASP at 303-444-9799. It can be downloaded online at mysmokefreehousing. org. “This guide is a great resource to multifamily-housing providers who seek guidance on developing and implementing effective smoke-free policies. I especially like the fact that owners and management agents participated in the review of the guide prior to its publication,” says Bob Prettyman, Chief Operating Officer – Housing Management for the Denver Housing Authority. ...continued on page 5

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Colorado Springs Apartment Sales on Record Pace

ommonwealth, Colorado’s Oldest Apartment firm, recently released their’ Apartment Sales Report” for Colorado Springs. The report includes all sales of complexes above 30 units from January thru July 1, 2014 plus sales data from 1990 thru present. The Colorado Springs apartment market is on a record breaking pace. Sales Volume: Total sales volume was $273,570,000. Sales volume in 2013 for the same period was $33,533,600. 2013 total Sales volume was $166,688,600. Sales volume for 2012 was $177,840,000. Volume for 2011 was $125,555,000. Total sales volume for 2009 was a recording setting low of $48,775,000. Sales volume of just under $167 million for 2008, $273 million for 2007, $204 million in 2006 and $150 million in 2005. There were 3,302 total units closed compared to 248 units closed in this period in 2013. There were 18 total market sales from January thru July 1, 2014. There were 20 sales total for the entire year of 2013, 2012 had 19 sales compared to 11 sales for 2011 and 8 total sales

in 2010. There were 19 total sales in 2008 and 22 sales in 2007. Class A: For the first time in many years, Class A sales were number one in both sales volume and number of units. There were 4 sales totaling 1,186 units with a sales volume of $159,850,000. The average price per unit was $134,781 and average price per square foot was $124. The lowest price in this class per

unit was the Pinnacle apartments at $121,667. It also sold for the lowest price per square foot at $115. The Peaks at Woodmen commanded the highest price per unit at $148,348 a door. The Peaks, a 230 unit complex was constructed in 2011 on East Woodmen and was the first complex to come on line in this cycle. The 292 unit Spring Canyon apartments at Garden of the Gods Rd. & 30th Street sold for the highest price per square ...continued on page 7

The Post-Dated Notice to Vacate

ccording to urban legend, there are teachers who will address their students on the first day by stating “As of today, you all have F’s. It is your job to work your way out of the cellar to the grade you truly deserve.” Urban legend or not, I had such a teacher – AP English…senior year of high school. For fear of a 25-year grade reversal, I won’t mention said teacher’s name. Let’s just call him/her, The Professor. The Professor was a piece of work; hard, brash, and unyielding in every sense of the word. The Professor

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treated everyone as if we were already in college. Students with excuses were often ridiculed and those who outright lied were made to exit the class altogether. The Professor had extremely high standards and very little patience. Everyone dreaded their daily encounter with The Professor and thought of graduation more like prison release day. So, imagine the collective groaning when The Professor was tapped to represent the faculty and give a speech during the graduation ceremony. The Professor, really? In the

past, the faculty representative was always the “popular” teacher, the one who got the most screams and cheers from the graduating class. The year before, when my sister graduated, the faculty speaker quoted Run DMC. That’s what we wanted – not some long, drawn out soliloquy by The Professor. The Professor began with, “I want to open by stating three important facts. Yes, I was tough. Yes, I demanded a full effort from each and every one of you. And yes, you have ...continued on page 6

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Fed Chair Says a Mouthful to Property Owners and Managers By Marc Courtenay

n Tuesday July 15 Fed Chair Janet Yellen said more than Congress and most managers were anticipating. Her carefully prepared comments are a big insight into how those who control America’s monetary policies are thinking. According to a report by USA Today Federal Reserve Chair Janet Yellen told Congress the economy is improving but still needs the central bank’s support, refusing to provide a specific timetable for raising shortterm interest rates. “There’s no formula or mechanical answer I can give you,” Yellen said when pressed by Sen. Mike Crapo, R-Idaho, ranking member of the Senate Banking Committee. She added, “The economic outlook is very uncertain.” That is a plain spoken way of saying that the Fed needs to continue its accommodating monetary policies. This includes keeping interest rates low. The benchmark 10-year Treasury bond yield fell to 2.54% which will lower mortgage rates in the weeks ahead. Now’s an auspicious times

for property managers to remind their clients to refinance loans while rates are down and lenders are likely to have more funds to lend. With inflation rising and the government’s unemployment rate falling some economists and lawmakers have suggested the Fed should prepare to raise its benchmark short-term interest rate sooner than planned. Although the Fed is steadily eliminating its bond buying stimulus program, Fed policymakers have indicated only that they plan to be able to begin raising interest rates sometime in 2015. Ms.Yellen said that several labor market indicators, like the share of the population in the workforce, remain low. She said the ranks of the long-term unemployed are still at “unprecedented levels historically.” The Fed Chair also downplayed concerns about inflation, which has been picking up, but at 1.8%, remains below the Fed’s 2% target. Noting that wage gains are improving, she said they’re “not rising to the point where they can give way to inflation.” No doubt about it, The Fed knows

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the economy still faces headwinds as a result of the Great Recession. Noting low productivity growth, Yellen told lawmakers: “We have seen false dawns” before. As for the housing market, the Fed chair noted that the housing sector “has shown little recent progress.” “While this sector has recovered notably from its earlier trough, housing activity leveled off in the wake of last year’s increase in mortgage rates, and readings this year have, overall, continued to be disappointing.” While also speaking to the Senate Banking committee, Ms. Yellen set a powerful precedent. She spoke directly about her concern over what Reuters reported as

…stretched valuations in certain corners of the U.S. equity markets, including the small cap, biotechnology and social media sectors. “The unusual comments from the Fed’s monetary policy report – the first time in 14 years that the Fed has commented specifically on valuation of a particular equity sector – that accompanied Fed Chair Janet Yellen’s semi-annual testimony to Congress, hit stocks in riskier sectors of the market” Reuters summated. Yellen said in her remarks that valuations across equity markets remain generally in line with long-term averages, but the Fed’s report said the forward price-to-earnings multiples for smaller companies and those in the biotechnology and social media sectors appear “high relative to historical norms.” My takeaway is that the Fed Chair wants to cool down the stock market while noting that the housing sector still requires sufficient stimulus. Look for home prices to move higher along with rent rates. PropertyManager.com a Service of AppFolio

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Rental Housing journal Colorado • August 2014

RENTAL HOUSING JOURNAL COLORADO

Dear Maintenance Men: By Jerry L'Ecuyer & Frank Alvarez

Dear Maintenance Men: By Jerry L'Ecuyer & Frank Alvarez Dear Maintenance Men: I am a firm believer in doing interior and exterior inspections at my properties. However, as I’m getting older, I find I am spending less time at the buildings, so I need to use my time constructively. What should I include in an inspection report to help me decide what work to do now or later? Fred Dear Fred: You are thinking ahead and that is a good thing! Just because you visit the property less, does not mean the building requires less maintenance and as you know, routine maintenance issues evolve into costly repairs that could have been avoided. Here are some of the things we pay special attention to:

we make sure those fire extinguishers are functional and fire escape areas are clear of clutter. 2: It is important to check building exteriors for cracks in the foundation, open crawl spaces and any places in brick work or stucco where water might get into the walls during heavy rain. This includes making sure that caulking around vents and piping is sufficient. We do a similar inspection of the roof, looking for spots were leaks might occur. 3: Make sure that all of the property's windows close smoothly and securely and identify any broken panes. Windows that leak or collect condensation on the sills can create major problems down the road.

4: Biannual furnace filter inspections at the end of fall and spring will keep your HVAC systems operating at peak performance, while ensuring dangerous conditions are not present. 5: The most costly and damaging of all deferred maintenance is water related. Plumbing throughout the building must be inspected to make sure that seals are secure, faucets are not leaking and pipes are in good condition. Residents should be encouraged to report leaks and drips. A small leak under a cabinet can create serious damage if left unchecked.

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3: Fire Hazards such as dryer vents should be inspected to make sure they are clear of lint and debris. Chimneys are inspected for cracks and proper ventilation. Both gas 1: First and foremost, we look for and electric water heaters pose potential hazards. Broken sidefire and water hazards. Electrical walks, poorly lit Apr, stairs, Jun, missingAug, Feb, Oct, Dec connections are checked as are handrails; anything that can pogas lines along with water pipe tentially cause an injury for a resiconnections and venting. dent or a guest. And, of course,

machines, garage door openers and other mechanical devices such as garbage disposal units and re-circulation pumps etc. in your inspections. Check for loose wires, water leaks and unsafe conditions. This is only a partial list and individual buildings may differ in their needs.

Dear Maintenance Men: It is currently summer time and that is when we get the most vacancies. How do I keep my residents from moving? Denise Dear Denise: According to the 2011 national resident study, "Getting Inside the Head of the Online Renter," the number one factor in a resident's decision to renew a lease is "Quality of Maintenance Services." Additionally, the current SatisFacts Insite® Index for Work Orders indicates that 18% of all service requests are not completed right the first time. And of those, only onethird of residents received notification that there would be a delay in completing the request. What the above means is poor maintenance service can lead to higher vacancies. It does not matter if you have 10 units or 100 units; maintenance is a critical tool in the physical well-being of your property and the happiness of your residents. Think of it this way. A service call and parts may cost $250 to service a broken washing machine or water heater, resulting in a satisfied resi...continued on page 8

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Rental Housing journal Colorado • August 2014

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RENTAL HOUSING JOURNAL COLORADO

Campus-Style WiFi Systems: The Amenity for Today

partment residents have long held in high regard such amenities as a fitness center, a patio, a washer/dryer and a pool, but now of equal importance as those features is having high-speed community-wide Internet service. Having high-speed communitywide Internet service is now among the most desired amenities according to a 2013 survey by the National Multi Housing Council. More than 70 percent of respondents said that it was important or very important. Easy enough, right? Practically every restaurant and coffee shop you visit has wireless Internet service. Most libraries have it. Many college campuses do too. If the corner Starbucks (and mid-block Starbucks and other corner Starbucks) can pull this off, surely you can too. Is it as simple as expanding the WiFi you already have running in your business center or around the pool area? It’s not. As many an apartment manager has discovered, there are a plethora of significant hurdles to setting up a WiFi system that provides consistent, fast and full coverage across a number of buildings and in open spaces. It would be hard to design something that would be tougher to bring

WiFi to than an apartment community. Concrete. Stucco and wire framing. Metal duct work. Hot-water heaters and washers and driers. Fireplaces. And any number of devices in each unit trying to connect to the Internet. In fact, everything apartment communities have in quantity interfere with the microwave level frequencies that WiFi uses. The vastness of the area to provide coverage is yet another challenge. Most WiFi access points (AP) have

an indoor broadcast range of between 25 to 100 feet, so dozens if not hundreds of AP units are required to create complete coverage. These AP units need to be installed with great care and must operate in coordination so that all areas get coverage but that each signal doesn’t interfere with the other. In most urban areas, all the other devices operating on the license-free radio frequency cause interference with WiFi systems, which weakens

the signal and can cause interruptions. These devices include mobile phones, baby monitors, radios, twoway radios and other WiFi systems. Couple that with the small antenna most consumer devices have and you have connectivity issue. Security is increasingly one of the biggest issues in setting up a WiFi system. Hackers target public WiFi systems that are weakly defended or are poorly designed, snooping about for sensitive information to exploit. With the high-profile security breaches in the past few years, users are more conscience than ever of the need for top-quality security. Perhaps the greatest hurdle in installing community-wide WiFi in apartment communities has been the cost. The electronic hardware and cost of installing the equipment can easily top $100,000 (not to mention on-going maintenance), too great a price tag for most apartment community owners to justify installing, leaving residents to each get their own Internet service. But a few wireless internet service companies have developed new equipment, software and delivery methods that solve the issues that Continued on page 6

5 reasons to use rentegration 1. Access - Rentegration.com is a web based, multi-user software offering customers 24/7 access to forms generation, archives, property management database, basic accounting, vendor ordering and other services. 2. Rental and Lease Forms - Unlimited use of a full line of state specific rental and lease forms. All Rentegration.com forms are created by attorneys and/or local rental housing associations. 3. Simplified Accounting - Owners

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companies use Rentegration.com Colorthat Standards for National Tenant Network Logo for only forms generation will save time • Logos areover providedother on the CDmethods. in all three forms: and money Mid all black, reversed to white, or in PMS 280 Blue/PMS 7543 Gray spot or 4/color applications. and small size property managers and Please see below for specific use examples. independent rental owners can manage • No other colors are acceptable for use for the logo. their entire business at a fraction of the • No altering of the logo is allowed. If you have a special circumstance that requires something not cost of other and providedsoftware on the CD, please callforms. NTN NaTioNaL HeadquarTerS 1.800.228.0989 for assistance. • Logos should not be put over a busy background.

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Out

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DESCRIPTION OF PET(S) Windows

Light Fixtures

Dishwasher Counter Tops

Doors/Woodwork

Locks

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Windows 1) The pet(s) shall be on a leash or otherwise under tenant’s control when it is outside the Antenna/Cable tenant’s dwelling TV unit. Blinds/Drapes 2) Tenant(s) shall promptly pick up all pet waste from the premises promptly. Fireplace 3) Tenant(s) are responsible for the conduct of their pet(s) at all times. 4) Tenant(s) are liable for all damages caused by their pet(s). Cleanliness 5) Tenant(s) shall pay the additional security deposit listed above and/or their rental agreement as a condition to keeping the pet(s) listed above. 6) Tenant(s) shall notBEDROOM allow their pets to cause any sort of disturbance or injury to the 1 BEDROOM 2 other tenants, guests, landlord or any other persons lawfully on the premises. Walls 7) Tenant(s) shall immediately report to landlord any type of damage Walls or injury caused by their pet. Windows 8) This agreement is incorporated into and shall become part of Windows the rental agreement exe Blinds/Drapes -cuted between the parties. Failure by tenant to comply with any part of this agreement Blinds/Drapes shall constitute a material breach of the rental agreement.

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Refrigerator

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Tub/Shower

Disposal

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Doors/Woodwork

Rods

______________________________ Floor Tenant ______________________________ Light Fixtures Tenant

Locks

Ceilings

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Floor day for compliance

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Fireplace Plumbing

BATH ROOM

Towel Bars

Electricity Hot Water

Windows

permission.

Blinds/Drapes

Rods

Tub/Shower Fan (Exhaust)

of this form may Floor be reproduced without

Rods

Floor

Light Fixtures

Electric Outlets

Doors/Woodwork Locks Ceilings Electric Outlets Smoke Detectors

Rental Housing journal Colorado • August 2014

Essential Services Plumbing Heating Electricity Hot Water Smoke Detectors

written permission.

Light Fixtures

Doors/Woodwork Locks Ceilings Electrical Outlets Smoke Detectors

Toilet

BEDROOM 2 Walls

Blinds/Drapes

may be reproduced without written

sales@rentegration.com

Sink & Vanity

BEDROOM 1

Smoke Detectors

Doors/Woodwork

Locks

Cleanliness Heating

Ceilings Electric Outlets

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___________ ______________________ Out CITY: ______________________ ________ DATE:________ ___________

Pursuant to RCW 59.18.150, this is your WA-RTG-20 Washington 48 hour entering the dwelling notice that your landlord unit and or their agents will ______________________ premises located at (Address) CHECK-IN/CHE be ______________________ CK-OUT CONDIT Floor ION REPORT______________________ ____________ on Light Fixtures TENANT(S between the hours ): ____________________ (Date) of and ____________________ Doors/Woodwork ADDRESS: . ____________________ __________ (Time) ________________ (Time) ____________________ CITY: Locks____________________ The entry ________UN will occur for the following __________ _____ STATE: ________purpose:IT: ______________ ___________ Rating CeilingsScale = (E)Excellent ZIP: _________________ ______________________ (VG) Very Good___________ ______________________ ___________ (G)Good ___________ (F)Fair (P)Poor Electric Outlets IN ______________________ _______________________ Out LIVING AREAS ______________________ In Out _ KITCHEN In Out

Cabinets Tenant(s) Tenant(s) certify that the above pet(s) are the only pet(s) on the premises. Ceilings understands that the additional pet(s) are not permitted unless the landlord gives ten Sink ant(s) written permission. Tenant(s) agree to keep the above-listed pets in the premises Electrical Outlets subject to the following terms and conditions: Floor

_____________________________ Floor Landlord

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PMS 280/PMS 7543 over color

TENANT(S): ___________ ______________________ ADDRESS:

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AGREEMENT

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WHITE (with 40% gray circle)

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RENTAL HOUSING JOURNAL COLORADO

by Ernest F. Oriente, The Coach {Article #220…since 1995}

ccording to a recent survey by Matrix Information, three billion people around the globe have access to Internet-based services and E-mail. In addition, this report expects electronic commerce to grow from $3.2 trillion in 2013 to $6.2 trillion by the year 2015. Is your property management company ready for these exploding communication and marketing trends? Is your leasing team ready to handle the Email just sent by 15 new prospects relocating from Paris or Moscow? Read the tips in this article and learn how easy it is to master E-mail and profit from it…it’s just a few keystrokes away!

Tips for using E-mail with prospective new residents: Ask your leasing teams to always use spell check before sending an Email to a future resident • Have your teams read each E-mail

twice before they send it, just to make certain it conveys exactly what they are trying to communicate and it portrays the professional image important to your property management company • When sending an E-mail, the subject line must clearly summarize what the body of the E-mail says • If your leasing teams are using the E-mail “reply” feature to respond to a future resident, make certain they reply by including the information the prospect sent in their original E-mail note. In addition, ask your leasing teams to include the name of the future resident throughout their E-mail reply. Tips for using E-mail within your property management company: When your leasing teams are using E-mail to communicate internally, make certain they understand

management companies

when to respond by E-mail and when to call the person who sent the original E-mail, depending on the tone or content of the E-mail • Explain to your leasing teams how and when to use carbon copy {cc} and blind carbon copy {bcc} with E-mail • Have a written company policy regarding the use of E-mail, clearly outlining the rules and expectations of your company. Have this document signed by each person who will be accessing your E-mail software • Explain to your leasing teams that deleting an E-mail does not remove it from their computer system nor from the system of the person the E-mail was sent to. During several recent lawsuits, damaging E-mails that had been deleted were used in the courtroom to the surprise of the individuals and their property

• Instruct your leasing teams about the extra care required if they receive an E-mail that has an attached document, as this is where most computer viruses are hidden. Many property management companies do not let their leasing teams send or open attached files • E-mail files can easily be opened and read so confidential information like salaries, financial reports, social security numbers or credit card numbers should not be sent by E-mail. Tips for using E-mail as a marketing tool: E-mail can also be used as a powerful marketing tool to attract new residents or to better service your existing residents. Here are some tips: Aside from a small $15-$20 service charge per month, sending or receivContinued on page 7

No-Smoking..continued from front page An increasing number of housing providers and managers want to reduce smoking-related cleanup expenses and maintain a healthy living environment for their residents and staff. As a result, there is a growing trend to implement nosmoking policies in multiunit residential buildings. In fact, there are more than 3,000 multiunit residential buildings, including hundreds of Housing Authority buildings, which

hwwave a no-smoking policy for the entire building or grounds in Colorado. GASP maintains a growing list of these properties at mysmokefreehousing.com. The Group to Alleviate Smoking Pollution (GASP of Colorado) is a statewide nonprofit 501-C(3) organization working to eliminate secondhand smoke from the air we breathe by advocating for smoke-free policies at work, in public places, and in

multiunit housing. GASP works to educate businesses about the positive economic benefits of smoke-free policies and provides resources that lead to smoke-free policies. Pete Bialick Phone: (303) 444-9799 E-mail: info@gaspforair.org

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Rental Housing journal Colorado • August 2014

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RENTAL HOUSING JOURNAL COLORADO

WiFi ...continued from page 4 have long prevented apartment communities from installing campus-like WiFi. A growing number of apartment communities are installing the service and marketing the much-desired amenity. Residents of the Emparrado Apartments, a 154-unit community in Mesa, have been receiving highspeed Internet service since the spring. In addition to faster speeds, resident are most excited about being able to unbundled service from cable providers, saving money, and in the flexibility of service, said Debbie Achs, property manager. “I live here and I am dumping the Internet portion of my cable service,” she says. Most residents don’t want a land line phone, and a good portion want to drop cable TV service, given the increasing cost. Having campus-style WiFi has made the property more attractive to potential residents, Achs said. “It's been the one amenity that every single potential resident has asked about,” she said. “It's been a huge influence. It just opens the door to new and better things.” How have wireless Internet service companies overcome the difficulties in having campus-style WiFi in apartment communities? First, they’ve taken advantage of the high-speed and high-capacity data packages available directly from

data center operators. By eliminating the cable or satellite dish companies from the equation, end users get Internet service at a fraction of the prior cost and the apartment community owners can establish a new profit source. Installation costs are typically borne by the Internet service companies, who earn a return from the monthly charge to end-users. “The technical solutions were difficult; we tried many designs that just didn’t perform,” said Rory Conaway, a well-known radio frequency engineer and owner of Phoenix-based Triad Wireless, which designed and installed the campus-style Wi-Fi system that was installed at the Emparrado Apartments. “But we knew the market demand for campus-style WiFi was strong and worth the engineering and technical effort.” At the behest of Red Hot-Spot Company, a start-up Internet service provider, Triad Wireless spent more than a year in R&D creating a proprietary Wi-Fi design for apartments. Access points are where end users connect to the Internet. Triad’s design uses access points that are a third the size of the smallest access point previously on the market. The small size and increase in power made it possible to design and build a campus-style WiFi system that overcomes stucco, steel, firewalls and a geographically spread com-

munity, Conaway said. Concurrently, Red Hot-Spot developed a proprietary software system that manages each account separately, blocks external sharing, allows each household to have multiple devices connected at any one time, manages gamers, and manages the revenue and service components. “It seems like a simple task – having multiple users and multiple devices trying to connect from one apartment unit – but it was quite a challenge to develop the software to allow that to happen without connection and security issues,” said Red Hot-Spot President Zach Spain. Security for end users was also addressed in designing the campus-style WiFi system, Spain said. Rather than users having to rely on the security filter on their home computer and devices, which are often outdated or over-matched, users of campus-style WiFi are protected by a commercial security system that filters out threats and dangers before they ever get reach users' computers. “This is a level of security typically found at Fortune 500 companies,” Spain said. “We knew we had to offer that kind of peace of mind on a WiFi system, given that it’s viewed as a shared system and because of the increasing level of threats on the Internet.” The Phoenix-based company,

which is just two years old, has installed campus-style WiFi in a number of communities in Phoenix and Tucson, and expects to start construction on dozens of communities throughout the Southwest by fall. D.J. Burrough is a Scottsdale-based freelance writer. His work has appeared in Urban Land Institute Magazine, The New York Times, The Dallas Morning News, The Christian Science Monitor and The Arizona Republic. Red Hot-Spot is a Phoenix-based wireless Internet service company that creates campus-style WiFi in commercial and multifamily housing settings. For more information contact Red Hot-Spot at www.redhotspot.net or call 1-800-4686851.

Vacate ..continued from front page become better human beings for it.” The Professor went on to explain the “work your way out of the cellar” philosophy tested a student’s motivation, tenacity and confidence. For a student’s grade go from an F to a B over the course of the year, purely based on effort, was more of a motivation than to tread water or to just get by with the minimum required to pass the course. Years later, I still remember his closing, “Whether you’re swimming or treading water, your arms and legs are moving. The big difference is swimming gets you to the shore. Treading water gets you exhaustion.” So how exactly does The Professor relate to our industry? Well, imagine a new resident arriving for move-in, happily looking forward to becoming a part of your community. Upon signing the final page of the lease, they turn in a post-dated notice to

vacate. What they’re saying is, “I have every intention of leaving after one year unless you can convince me otherwise.” If you knew a resident was on their way out at day one, would you throw in the towel or prove them wrong? It’s the same as the out of the cellar philosophy. Motivation, tenacity and confidence mean everything to resident retention. Make the most of every resident interaction, have ready answers (not excuses) and demonstrate there is no better community for your resident through unparalleled service. BY Lia Nichole Smith | VP – Education and Consulting | SatisFacts Research and ApartmentRatings.com

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RENTAL HOUSING JOURNAL COLORADO

Apartment Sales ...continued from front page foot at $138. Class B: There were three Class B sales with a volume of $41.4MM. Average price per unit was $82,143 with the average square foot price being $94. The 208 unit Cheyenne Crest had the highest price per unit at $84,615 per door and $108 per square foot. Class C: There were only two Class C sales totaling 508 units with a sales volume of $27.750MM. The average price per unit was $54,626 and $83 a foot. Class D: Class D complexes continued to be hot with 9 sales, the most of any class. They were also number one in 2013 with 16 separate sales. The average price per unit paid for Class D product was $40,397. Prices were $17,000 per unit in 2008 and $17 per square foot! $24,000 per unit in 2010 and $31 per square foot. The average price per square foot was $50. The 190 unit Cheyenne Vista, above Motor City, commanded the highest price per unit at $57,105 while Alikar Gardens-124 units had the highest price per square foot at $85. Vista Peak sold for the lowest price per unit at $29,070 a door and also had the lowest price per square foot at $28. The 258 unit complex is directly across the street from Mitchell High School, just off of Academy Blvd. Buyers are recognizing an opportunity to buy Class D product at lower unit/square foot prices compared to upper class prices, rehabbing them to modern conditions, etc. and then enjoying a nice cash flow or a good profit if they flip the deal after the remodel/lease up. We’ve rehabbed deals that are now getting $200 per month more rent than when they bought before the rehab, etc. These, normally older complexes, have mature landscaping and seasoned neighborhoods that aren’t found in newer complexes, which is attractive to many tenants, as it’s much quieter than in the areas that are still building homes, shopping centers, etc. Location is obviously a very important part of this equation to make it work, as you can remodel junk and it will still be junk if in the wrong location. Also important to not “overbuild” a complex for its location, as you will only draw a certain class of tenant in a certain location.... No matter the physical quality of the complex. This huge difference in prices between Classes shows why separating complexes by Class is a must in order to have useful data. Wide data points skew the results. Most report mix all Classes together and come up with an “average”, which is meaningless to all Classes. Some reports separate complexes by the year of construction, which makes no sense. There was junk built Rental Housing journal Colorado • August 2014

23 Tips ...continued from page 5

in the last building cycle and some of our best constructed and located complexes were built in the 60’s! Mixing all classes together is like averaging Porsche speed times with a Prius; data is useless to both. Commonwealth’s reports are the only Colorado Springs apartment reports that separate the complexes into Class A, B, C, and D quality. We also rate each complex within its class, i.e. Class A’s are rated from 90 to 100, B’s 80-89, C’s 70-79, and D’s 60-69. We use 8 separate sub markets.

ing E-mail is free. When compared to other forms of marketing…having your leasing teams send E-mails to new or existing residents is their least expensive form of marketing

Size of Complexes: The size of the complexes sold ranged from 36 units up to the 364 unit Bella Springs.

• When your properties are using Email to handle resident questions or maintenance requests, a timely response is expected and required

Age of Complexes: Ages of the complexes sold ranged from 1965 to 2011. Why the Increase in Demand and Prices? According to a Pitney Bowes survey, the city is projected to grow 6.2 percent – or add 15,459 households – in the next five years. Colorado Springs ranked ahead of Fort Collins, which is 15th on the list. Denver did not make the list for the top 50 projected percentage growth, but was number 15 for the top 50 areas in projected absolute growth. The annual rate from 2000 to 2010 was 2.3 percent. Supply: Demand has caught up with the supply. The number of new units completed or on line are all basically Class A quality and most are in the Upper Northeast submarket. With the new higher construction costs, they will have to have rents considerably higher than existing complexes. The 4th quarter of 2013 added 308 new units to the inventory. The cumulative additions for 2013 are 568 new additions. 2012 was the first year of significant inventory additions since 2009 (299), and the most since 2003 (1,449), which represented a historic high during a prior economic cycle. By: Ron Spraggins, CCIM Founder & CEO of Commonwealth. Senior CCIM Instructor for 13 years First CCIM in Colorado Springs. Past President of the State of Colorado Apartment Assoc., Colorado Springs Apartment Assoc. and the Colorado/Wyoming CCIM Chapter. For the complete complimentary copy of Commonwealth’s Apartment Sales Report please contact: The Spraggins Team Ron@CommonwealthUSA.net www.CommonwealthUSA.net (719)685-4300

• Imagine the marketing success your leasing teams will have if they had the E-mail address on the guest card of every future resident who visited their apartment community over the past 12 months… and your leasing teams can stay in touch with these potential new residents for free!

• Create two separate E-mail lists… one for future residents and one for current residents so you can send appropriate marketing information to each group • Create an E-newsletter which can be easily sent out on a weekly or monthly basis. Remember, since sending E-mail is free, your leasing teams will have lots more flexibility. In addition, E-newsletters portray a professional image about your property management company and are quick to be passed-along to others, thus expanding the reach and exposure for your marketing • When sending E-mail, have your leasing teams develop a five to seven line signature which is automatically placed at the bottom of every E-mail they send out. This signature line will further promote their apartment community, your corporate website and can be changed on a daily basis, if necessary • Use E-mail to stay in touch with the media in your area, especially if your apartment communities have any exciting events or community projects to announce • The E-mail address at each of your properties should be included on every business card, every brochure, on any sales information and with all print advertising. Want to hear more about this important topic or ask some additional questions about how to use E-mail as a powerful marketing tool? Send an E-mail to ernest@powerhour.com and The Coach will E-mail you a free PowerHour invitation.

Author’s note: Ernest F. Oriente, a business coach/trainer since 1995 [32,320 hours], serving property management industry professional since 1988--the author of SmartMatch Alliances™, the founder of PowerHour® [ www.powerhour.com ], the founder of PowerHour SEO [ www.powerhourseo. com ], the live weekly PowerHour Leadership Academy [ www.powerhourleadershipacademy.com/pm ] and Power Insurance & Risk Management Group [ www.pirmg.com ], has a passion for coaching his clients on executive leadership, hiring and motivating property management SuperStars, traditional and Internet SEO/SEM marketing, competitive sales strategies, and high leverage alliances for property management teams and their leaders. He provides private and group coaching for property management companies around North America, executive recruiting, investment banking, national utility bill auditing, national real estate and apartment building insurance, SEO/SEM web strategies, national WiFi solutions [ www.powerhour.com/ propertymanagement/nationalwifi.html ], powerful tools for hiring property management SuperStars and building dynamic teams, employee policy manuals [ www.powerhour.com/propertymanagement/employeepolicymanuals.html ] and social media strategic solutions [ http://www.powerhour. com/propertymanagement/socialmedialeadership.html ]. Ernest worked for Motorola, Primedia and is certified in the Xerox sales methodologies. Recent interviews and articles have appeared more than 8000+ times in business and trade publications and in a wide variety of leading magazines and newspapers, including Smart Money, Inc., Business 2.0, The New York Times, Fast Company, The LA Times, Fortune, Business Week, Self Employed America and The Financial Times. Since 1995, Ernest has written 225+ articles for the property management industry and created 400+ property management forms, business and marketing checklists, sales letters and presentation tools. To subscribe to his free property management newsletter go to: www.powerhour.com. PowerHour® is based in Olympic-town… Park City, Utah, at 435-615-8486, by E-mail ernest@powerhour.com or visit their website: www.powerhour.com

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Dear Maintenance Men ...continued from page 3 dent. However, a resident having to live with a broken washing machine or intermittent hot water may elect to move rather than dealing with the hassle of calling in repeated service requests. That resident vacating will now cost the owner thousands of dollars in loss rent and rehab work to bring the unit back to rent ready condition. Good maintenance is a year round tool to keeping your investment healthy and your residents paying the rent month after month. Dear Maintenance Men: I have been hearing the term “Aging in Place” more and more lately. What does it mean and how does it affect my apartment building? Harold Dear Harold: Aging in place is defined as living in the community with a level of independence for as long as possible without the need of in home care. The biggest barrier to aging in place is our homes. Most homes and rental communities are ill equipped for long term aging in place residents. As an eye opening statistic, the Baby Boomer generation is 25 percent of the population and the first of the Boomers turned 65 in 2011 and the last will turn 65 in 2029. As apartment owners and managers, we need to pay attention to

this aging trend and not be caught off guard. Aging in place means bigger showers with wider doors, taller toilets, grab bars and bath sinks that will accommodate wheelchairs etc. As your units come up for rehab over time, think about these improvements; they might just be money in the bank for the long run. Bio: Please call: Buffalo Maintenance, Inc for maintenance work or consultation. JLE Property Management, Inc for management service or consultation Frankie Alvarez at 714 956-8371 Jerry L’Ecuyer at 714 7780480 CA contractor lic: #797645, EPA Real Estate lic. #: 01460075 Certified Renovation Company Websites: www.BuffaloMaintenance.com & www.ContactJLE.com www.Facebook.com/BuffaloMaintenance

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