Colorado RHJ February 2018

Rental Housing Journal Colorado

February 2018 - Vol. 10 Issue 02

2. New Tax Law Holds Favorable Prospects for Commercial Real Estate

4. Rents Unchanged in December but Still Up 2.5% Year-Over-Year 5. Dear Maintenance Men

Potential to Boost Space Demand and Capital Flows

7. Do You Know How to Respond to a Sexual Harassment Complaint?

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7 Pest Preventative Maintenance Steps for Rental Housing

Apartment Amenity Company Partners with Denver Property Manager

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he maintenance check up this week, provided by Keepe, asks whether you are taking the pest preventative maintenance you need in your rental housing to protect your investment and your tenants.

From mice to ants and cockroaches, pest infestations can cause serious property damage and traumatize tenants, significantly worsening their perception of their living conditions.

Property managers need to be aware of what draws pests to rental homes and adopt simple pest preventive maintenance steps that can protect properties and tenants.

7 Types of Pest Preventative Maintenance Steps No. 1 - To avoid any and all infestations, it is fundamental to regularly inspect properties for cracks, crevices and any kind of openings that would allow unwanted critters to access indoor spaces. This includes checking open vents and drainage pipes.

No. 2 - Pests need a source of moisture to survive, so it is adequate to minimize the presence of standing water by regularly checking whether pipes, AC units, gutters or downspouts leak or allow water to accumulate; scheduling seasonal maintenance and timely repairs for those systems is ideal.

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...continued on page 2

boutique apartment operator in Denver and Colorado Springs, Urban Phenix, has partnered with a lifestyle apartment amenity company, Amenify, to offer different types of on-site lifestyle experiences to residents, according to a release.

Urban Phenix, a boutique apartment operator in Denver and Colorado Springs, is partnering with Amenify to offer daily dog walks, apartment cleanings, massages, and personal training sessions. Urban Phenix is also building local partnerships with nearby gyms and yoga studios.

“We are thrilled with our properties’ participation rates. It’s wonderful to see that over 70% of our residents are enjoying their upgraded lifestyle with these amenity services” Nick Lazzarra, President of Urban Phenix, said in the release.

As competition for residents continues, there is a growing need for multifamily buildings to differentiate

themselves from the pack, according to the release.

Apartment amenity issue big for millennial renters “Data is showing that apartment renters’ checklists are growing, and this is especially true for millennial renters.

No longer is high-speed internet or a Visa gift card enough to attract new renters. Renters are overwhelmingly choosing properties based on lifestyle services that improve their move-in experience by instantly plugging them ...continued on page 6

Demand Keeps Investors Digging for Opportunities

I

Amid Soaring Home Prices and High In-Migration, Demand

nflow of young renters drives demand. In 2018, tech rms will provide a slew of employment opportunities to incoming residents, contributing to a tremendous boost in the 20- to 34-year-old population cohort.

With single-family home prices rising far above the national median in past years, residents nd apartment leasing an attractive alternative to the costly, long-term commitment of a mortgage.

Strong rental demand has resulted in an inux of new supply in recent years and heightened construction activity in 2018, particularly in the downtown area and in the adjacent Five Points and Highland neighborhoods. Denver has

experienced healthy absorption over the last several years and will continue that trend in the next four quarters as more than 12,000 rentals are slated for delivery. Amid robust demand, vacancy rates will remain near the 6 percent mark in the coming year.

Older units present buyers with extensive options. As Denver’s allure intensi- es, the market’s average rent will climb above the $1,500 mark in 2018, at a pace considerably faster than the national rate. While residents seek the modern amenities found in new projects, many search for recently upgraded properties that come at a lower price, including a number of

complexes in the western suburbs of Lakewood and Littleton. Here, an abundance of Class B and C buildings exist, many of them newly renovated from mid-20th century construction.

Private investors will continue to target these properties this year as initial returns have been historically favorable in the 6 percent span. Class B units in the northern sections of the metro, such as Westminster and Broomeld, have attracted institutional investors.

These complexes offer value-add opportunities, supporting potentially high revenue growth and rst-year yields in the 5 percent range. ...continued on page 4

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Rental Housing Journal Colorado

New Tax Law Holds Favorable Prospects for Commercial Real Estate Potential to Boost Space Demand and Capital Flows Marcus & Millichap

N

ew tax law retains key provisions for real estate investors. The highly anticipated tax reform recently signed into law by President Trump retained numerous key commercial real estate provisions. The1031 tax-deferred exchange, the mortgage interest deduction for investment real estate and asset depreciation had few material changes. This consistency in tax law will enable investors to move forward with most of their existing investment strategies. That said, there are many provisions in the new tax law that will have a more nuanced effect on the sector, and these more subtle adjustments could create significant new opportunities for real estate investors.

A

the last year, elevated uncertainty generated by the range of potential government policy changes, including tax laws, caused many investors to move to the sidelines. A more cautious outlook pervaded the industry as investors awaited clarity on taxes, fiscal policy and a change in Federal Reserve leadership. This perspective could begin to ease as the implications of the new tax law firm up and investors better understand how the new rules will affect their investments.

The new tax plan offers generous tax cuts to corporations and pass-through entities such as Limited Liability Companies(LLCs), and investors may see the new tax rules as an opportunity to reconfigure their portfolios. The new tax structure will apply to 2018 income for tax filings in 2019.

Reduced taxes on pass- dicates, partnerships and other through entities may boost pass through funds. This incapital flows. Perhaps more flux of capital,should it man-

important than the modest changes to the core commercial real estate tax rules that investors have been most focused on is the reduction of taxes on pass through entities.

Owners of these types of companies will enjoy a 20percent deduction on pass-through income, though there are several restrictions that will apply to this deduction. This favorable tax treatment will encourage investors to increasingly focus on after-tax yields when comparing their investment alternatives. On an after-tax basis,commercial real estate could offer a much stronger risk-adjusted return than options such as dividend stocks and bonds. This could entice additional passive capital to flow to the sector through syn-

ifest, could place downward pressure on cap rates.

Tax-induced behavior changes will be meaningful. In addition to the direct

effect the new tax law will have on commercial real estate investments,indirect effects could be equally important.

The increased standard deduction and limits on local property and income tax deductions could significantly alter housing demand and behavior.

At the same time, the elimination of the personal mandate of the Affordable Care Act (Obamacare) could impact long-term demand for healthcare real estate. The new rules could also spark increased consumption spending and more business investment into infrastructure.

Tax Law Changes to Reshape Behavior, Hold Implications for Investment Real Estate

partment demand likely to rise.

The previous tax rules created an economic incentive to purchase a home through itemized deductions.

If the mortgage interest and property taxes exceeded the old standard deduction of $12,700 for married couples ($6,350 for individuals) then taxpayers received a reduction to their taxable income that effectively offset a portion of the housing payment. The threshold home price to receive this benefit naturally depended on interest rates and local property tax rates but was in the $200,000 range for married couples. Under the new tax law, the standard deduction has been raised to $24,000 for married couples ($12,000 for individuals), and as a result the threshold home price to benefit from itemized deductions has increased to the $400,000 range for married couples. Because the threshold has increased well above the median home price in most metros, there will likely be a modest reduction of

2

Finalization of tax rules to reduce uncertainty. Over

first-time home buyers, lifting apartment demand.

Long-term prospects of healthcare real estate soften. The elimination of the per-

sonal mandate, a provision of the Affordable Care Act that required people to have health insurance, will reduce the total number of insured by 13 million people over the next 10 years. As a result, about 5 percent fewer people will have health insurance compared with the number that would have been insured if the personal mandate were retained.

This will modestly reduce the future demand for healthcare, implying a slight down shift in demand for healthcare real estate compared with projections with the personal mandate.

Nonetheless, the aging population will still increase demand for healthcare services over the next 10 years, just not as much as would have occurred with the personal mandate in place.

Market liquidity could rise; net-leased properties positioned favorably. The

newly introduced 20 percent deduction on income from pass-through entities could invigorate investment in real estate. On an after-tax basis, the yields offered by the sector will be even more compelling than under the previous tax structures. New capital could enter commercial real estate through syndicators and investment funds that are structured to capitalize on the pass-through advantages, but some new investors will enter the market with direct acquisitions. The additional capital will undoubtedly fl ow across a variety of property types including apartments, self-storage facilities, and retail, office and industrial buildings, but a segment that could attract a disproportionate share of the investment is single-tenant netlease properties. These assets, often occupied by high-credit tenants on long leases, afford passive investors compelling yields that could be structured to benefit from the new passthrough tax rules. In addition, because these types of proper-

ties generally require minimal management and are available in a wide range of price points, they are well positioned for passive investors.

Expanded expensing rules benefit niche real estate. Changes to the Section

179 depreciation rules will favor several niche real estate investments. Under the revisions, business owners will be able to fully expense up to $1 million of depreciable tangible personal property used to furnish lodgings. This change will allow investors with investments such as hospitality, student housing and seniors housing to deduct the full cost of furniture placed in service at their properties rather than depreciating them over multiple years. The rules also extend to roofs, heating, ventilation and security systems in non-residential property. This provision is largely targeted toward small businesses, so the deduction phases out as business investment purchases exceed $2.5 million.

Executive Summary ■ 1031 Exchange: Tax-deferred exchanges have been retained for real estate.

■ Business Interest Deduction: Interest on real estate loans remains deductible for real estate investments, but using this deduction will lengthen the depreciation period for real estate assets.

■ Depreciation: Depreciation timeline remains unchanged if mortgage interest is not taken. If the mortgage interest deduction is used, then the depreciation time-line for commercial properties increases from 39 years to 40 years and for residential properties it rises from 27.5 years to 30 years.

■ Carried Interest: The hold time of assets increases from one year to three years to treat earnings as capital gains.

■ Pass-Through Income: Business owners receive a 20 percent deduction on qualified income generated by pass-through entities such as LLCs, but there are some restrictions. For taxpayers earning over $157,500 (single filers) and $315,000 (married couples), deduction is limited to greater of 50 percent of the taxpayer’s share of aggregate W-2 wages paid by the business or 25 percent of the taxpayer’s share of aggregate W-2 wages paid by the business plus 2.5 percent of the unadjusted basis of all qualified property (structures but not land).

■ Corporate Tax Rate: Maximum tax rate reduced from 35 percent to 21 percent. Generous expensing and depreciation rules on capital expenditures over short-term.

■ Individual Tax Rate: Significant restructuring of personal taxes.

Still uses seven tax brackets, but the income span of each bracket has changed and the marginal rates have generally been lowered.

Standard deduction has been increased and several deductions have been eliminated or restricted.

■ Estate Tax: Doubles exclusion to $11 million for single filers and $22 million for married couples.

This report is not intended and should not be considered tax or investment advice. It provides an interpretation of the potential effects

of the new tax law on the commercial real estate market. A tax accountant should be consulted for guidance on specific tax rules.

...continued on page 3

Rental Housing Journal Colorado · February 2018

Rental Housing Journal Colorado

New Tax Law ...continued from 2

Tax Reform: 2017 Tax Law Vs. 2018 Tax Cuts and Jobs Act Provision

Old Tax Law (2017)

Tax Cuts and Jobs Act (provisions effective beginning 2018)

Like-Kind Exchanges

Available under current law for property held for investment

Retained for real property only (real estate).

Business Interest Deductibility

Fully deductible for all businesses

Fully deductible for real estate businesses with some exceptions.

Limits on interest deductibility apply to firms outside of real estate with exception for businesses with average annual gross receipts of less than $25 million over past three years.

Depreciation of Buildings

Residential 27.5 years, nonresidential 39 years

If the mortgage interest deduction is used, then the depreciation timeline for commercial properties increases to 40 years and for residential properties it rises to 30 years.

Carried Interest

Taxed at capital gains rates if held at least a year

Taxed at capital gains rates if held at least three years.

Business Tax Flow-through entity: Maximum rate of 39.6% REIT dividend maximum Rates rate of 39.6% Corporation: Maximum Rate of 35%

Flow-through entity: 20 percent deduction available for qualified pass-through income with some exceptions. REIT dividends eligible for 20 percent deduction. Corporation: Maximum rate of 21 percent.

Flow-through entity deduction sunset after 2025. Corporate rate cut permanent.

Active Losses

Fully deductible against active income

Deduction of net active pass-through losses against wage or portfolio income limited to $500,000 (married filers) and $250,000 (single filers). Disallowed losses may be carried forward as part of a taxpayer’s net operating loss. Provision effective through 2025.

Individual Tax Rates

Seven brackets ranging from 10 percent to 39.6 percent; highest rate effective at $418,400 (single filers)/$470,700 (married filers).

Seven tax brackets ranging from 10 percent to 37 percent. Highest rate effective at $500,000 (single filers)/$600,000 (married filers).

Rate structure expires after 2025.

Standard Deduction

Single: $6,350, Married: $12,700

Single: $12,000, Married: $24,000.

State and Local Taxes (SALT)

State and Local Taxes (SALT) deductible. Available deduction declines $10,000 limit on deduction of state and local taxes including property for income above $266,700 (single), $320,000 (married). tax and either income tax or sales tax.

Mortgage Interest Deduction (personal)

Deduct interest for primary or secondary residence up to $500,000 (single) or $1,000,000 (married). Home Equity Line of Credit deductible up to $100,000

Deduct interest for primary or secondary residence up to $750,000.

Home Equity Line of Credit no longer deductible. Loans prior to Dec. 16, 2017, grandfathered.

Estate Tax

$5.49 million ($10.98 million per couple) exclusion, 40 percent rate, and stepped-up basis for inherited assets

Exclusion doubled. Stepped-up basis retained. Provision after 2025 and tax reverts to current law exemption amount indexed for inflation.

E

conomy starts 2018 with formidable tailwind.

The U.S. economy closed 2017 in a particularly strong position, having added jobs continuously for a record 86 months. Unemployment has settled in the low-4 percent range, supporting stronger wage growth, and there are a near-record 6.0 million job openings awaiting qualified workers.

Consumer and business confidence continue to hover near decade-high levels, invigorating retail sales growth and corporate investment into infrastructure. The new tax rules could reinforce many of these trends through the many tax incentives that were created.

Corporate tax reductions likely to boost economy. Al-

though there is considerable debate regarding how much of the corporate tax savings will filter through to workers and the broader economy, several provisions of the new tax law should spark increased corporate investment. Accelerated depreciation and expensing rules should encourage companies to increase investments into plants and equipment, while reduced tax rates on the repatriation of overseas holdings should spark an influx of

New Tax Law Offers Prospects of Economic Lift capital coming back into the U.S.. Though much of this capital may be used for stock buybacks and dividends, the increased liquidity should spark consumption and support economic growth. The natural risk created by the inflow of so much capital will be rising inflationary pressure.

Lower personal tax rates should boost consumption.

The actual tax savings that fl ow through to individual tax payers will naturally vary depending on a wide range of variables, but the consensus is that most people will see at least a modest reduction in taxes. This will increase discretionary income that should translate to increased retail sales. This will take time, as most workers will see only a modest change in their tax withholding in each paycheck, but in aggregate, it should boost consumption, the primary driver of economic growth in the U.S.

Housing market slowdown could offset growth.

The restructuring of the tax rules will likely weigh on the owner-occupied housing market, particularly in states with elevated home prices and property taxes. The new tax law

Rental Housing Journal Colorado · February 2018

affects home sales in several ways: The increased standard deduction will modestly restrain first-time home buyers, while limitations on the deduction of state and local property taxes will weigh on upper echelon housing, particularly in California and states in the Northeast. The introduction of a lower limit on mortgage interest deductibility, now $750,000 instead of $1 million, will also weigh on higher-priced home sales. Since the recession, the housing market has contributed about 3 percent to economic growth, about half of the sector’s contribution levels of the early 2000s. Under the new tax law, housing’s contribution will likely weaken.

Fed to keep a watchful eye.

The increased liquidity and consumption levels created by the new tax law have the potential to raise inflationary pressure. The Federal Reserve raised its benchmark rate three times last year and most anticipate an additional three rate increases in 2018.

The Fed will also likely continue its efforts to reduce its balance sheet by allowing assets acquired during its quantitative easing efforts to mature. Through this process,

the Fed will make an effort to put upward pressure on longterm interest rates. The central bank will vigilantly watch for liquidity-sparked inflation.

Prepared and edited by John Chang First Vice President, National Director Marcus & Millichap Research Services Tel: (602) 707-9700 john. chang@marcusmillichap.com © Marcus & Millichap 2018 www.

MarcusMillichap.com

should not be considered as investment or tax advice. Sources: Marcus & Millichap Research Services; BLS, CoStar Group, Inc., Federal Reserve, Moody’s Investors Service, NMHC, Real Capital Analytics, Standard & Poor’s, U.S. House of Representatives, U.S. Senate, U.S. Internal Revenue Service, U.S. Bureau of Economic Analysis, policyuncertainty. com

•

The information contained in this report was obtained from sources deemed to be reliable.

Every effort was made to obtain accurate and complete information; however, no representation, warranty or guarantee, express or implied, may be made as to the accuracy or reliability of the information contained herein. No representation, warranty or guarantee, express or implied may be made as to the accuracy or reliability of the information contained herein. This is not intended to be a forecast of future events and this is not a guaranty regarding a future event.

This is not intended to provide specific investment or tax advice and

3

Rental Housing Journal Colorado

Demand Keeps Investors Digging ...continued from 1 NMI Rank 14, down 1 place

Supply outstrips demand, edging Denver down one position in the NMI.

Employment up 1.4%

Employers will add 20,000 new hires to payroll in 2018, up from approximately 17,000 in the previous 12 months.

Construction 11,100 units

Completions will remain elevated in 2018 as more than 12,000 rentals are added to inventory, the third most since the turn of the millennium. Last year, 12,500 units were completed.

Vacancy up 50 bps

The continued building boom will push the vacancy rate to 6.3 percent this year despite the absorption of roughly 10,000 units.

Rent up 6.8%

Following a 7.2 percent hike last year, rent growth will ease in 2018 due to heightened deliveries. The average effective rent will rise to $1,550.

Investment

A competitive bidding environment will evolve as limited listings retain a tight buyer and seller gap, resulting in a healthy investment climate.

Rents Unchanged in December but Still Up 2.5% Year-Over-Year

T

he average multifamily rent in the U.S. stood at $1,359 in December, unchanged from November but a 2.5% year-over-year increase for rents, according to a survey of 121 markets by Yardi Matrix.

Strong demand, the economy’s solid footing and a robust job market offer encouraging signs that growth will continue in 2018.

Rents were down 0.3% in the fourth quarter, which is only the second negative quarter of growth nationally since the second quarter of 2010 (rents also fell 0.2% in the fourth quarter of 2016).

“Although the results are somewhat negative compared to recent history, what’s notable is how consistently strong the market has performed during the entire recovery,” Yardi Matrix writes in the report.

Outlook for 2018 rents still good especially secondary markets

The question for 2018 is how much more steam is left in the market, whether the deceleration will continue or if it will level off or turn negative, the report says “Our view is that growth will continue at roughly the same rate nationally, led by strong demand. The economy shows no signs of slowing down, as GDP comes off two strong quarters and should get at least a boost from lower corporate and personal tax rates, while job growth continues to impress.

“Combined with the growth of the

young adult population, household formation should remain robust. The consistent national numbers mask a great deal of movement on the metro and submarket level.

Secondary markets such as Sacramento, Orlando, Las Vegas, Salt Lake City and Colorado Springs with affordable rents and growing populations should see above-trend increases.

Business-friendly markets such as Dallas and Atlanta should see a slowdown in rent increases, but see moderate gains nonetheless, while expensive coastal markets such as New York City and markets with excessive supply growth are likely to see little or no gains.

West Coast markets saw weak fourth quarter West Coast markets, specifically those in the Pacific Northwest, were the weakest on a T-3 basis.

Seattle (-0.8%), Portland (-0.5%) and San Jose (-0.5%) saw rents decline due to a combination of oversupply and historically expensive rent levels About Yardi Matrix: Yardi Matrix, formerly known as Pierce-Eislen, Inc.®, was founded in March, 2000, and acquired in July 2013 by Yardi Systems, Inc., a Santa Barbara, California software company focused on commercial real estate industry applications.The Yardi Matrix apartment information service is a high-performance system with the sole function of supporting the commercial apartment industry’s dominant participants. The company's services monitor the 50+ unit apartment universe from the property level to the submarket/market level in a form unique within the commercial apartment information industry.

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Rental Housing Journal Colorado · February 2018

Rental Housing Journal Colorado

Dear Maintenance Men:

By Jerry L'Ecuyer & Frank Alvarez Dear Maintenance Men: One of the maintenance chores I do are caulking and sealing shower/tub fixture flanges and shower walls. My problem is getting the caulking to dry before a resident uses the shower. Any Suggestions?

David Dear David: A lot of people will say: “Just tell the resident not to use the shower till the caulking is dry”. Well it doesn’t work and by the time you are driving away from the building, your resident is already taking a shower and your fresh caulking is washing down the drain.

Your caulk should cure at least 24 hours before use. Water based latex caulking is easy to use, but very susceptible to water until it is cured. Try using a silicone or polyurethane based caulking for doing tubs, showers, toilets, sinks or other wet locations. It tends to set quickly and will repel water during its cure time.

Another solution we have found works well with very busy showers is to remove all the fixtures, including the shower head & arm, valve handles and tub spout, before caulking. (A bit extreme, but effective) We then plug the shower head and tub spout with

a capped pipe. Then caulk the tub/ shower. We come back 24 hours later and reinstall all the fixtures.

One more thought; if you have sliding shower doors for your tub, check the bottom track. If it is loose, do not caulk until the track is removed, cleaned and dried. Reinstall the track with new adhesive caulk to hold it down and caulk the edges to keep the water out.

Dear Maintenance Men: My building gets hit by graffiti on a regular basis. How can I stop this curse?

Jim Dear Jim:

We understand. Our company maintains several properties that attract graffiti like a magnet. There are several solutions that may help.

1. Painting over graffiti as quickly as possible will help deter future vandalism. We recommend painting over the same day or within 24 hours of the graffiti appearing on your property.

Graffiti vandals like to advertise. By removing the graffiti quickly, the less recognition the vandals will receive, thus making your building less attractive to graffiti taggers.

2. Install lighting in areas prone to graffiti. Motion activated lights also work well to deter vandals. (If you have a sense of humor, install motion activated water sprinklers.)

3. Planting vines or bushes along a wall or the side of the building is a good long-term solution. As the landscape grows, it will make it more difficult to graffiti your walls.

4. Use an anti graffiti paint. The graffiti will easily wash or wipe off making repainting a thing of the past.

Dear Maintenance Men: I have a resident who is complaining the garbage disposal smells. I have tried running lemon slices and ice cubes to clean the disposal unit. It works for a short time, but the smell comes back.

What steps do you recommend for resolving this problem?

Barbra Dear Barbra: The smell may come from a number of places.

1: The first and easiest to check is the rubber splash guard that keeps things from falling into the disposal. Remove

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the rubber splash guard and turn it inside out. Clean out the debris that have collected and wash with soap and water.

2: Use a small toilet type bush with soap and scrub the inside of the garbage disposal. This will remove any slime build-up. (For safety reasons, shut the garbage disposal off at the breaker or pull the plug.)

3: Remove the drain trap and clean out any sludge. Many times the horizontal pipe between the trap and the wall may have hard deposits coating the inside of the pipe. The deposits will collect food and debris that may slow the drains considerably.

4: If you have a dishwasher, check the drain line leading from the air-gap or dishwasher to the garbage disposal.

It may be full of sludge that will cause a smell to come through the air-gap located next to the faucet. Clean or replace any pipes with deposits or sludge. Check both drain lines for the above problems.

5: Now if you wish, run the garbage disposal with a few slices of lemon and it should smell good and stay that way.

Once in a while, throw some ice cubes in the garbage disposal unit to help scrape away any debris.

Note: If you would like to see your maintenance question in the “Dear Maintenance Men:” column, please send in your questions to: DearMaintenanceMen@gmail. com Bio: If you need maintenance work or consultation for your building or project, please feel free to contact us. We are available throughout Southern California.

For an appointment please call Buffalo Maintenance, Inc. at 714 956-8371 Frank Alvarez is licensed contractor and the Operations Director and co-owner of Buffalo Maintenance, Inc. He has been involved with apartment maintenance & construction for over 20 years. He is also a lecturer & educational instructor and Co-Chair of the Education Committee of the Apartment Association of Orange County as well as being Chairman of the Product Service Counsel. Frank can be reached at (714) 956-8371 Frankie@BuffaloMaintenance. com For more info please go to: www.BuffaloMaintenance.com Jerry L'Ecuyer is a licensed contractor & real estate broker. He is currently on the Board of Directors and Past President and past Chairman of the Education Committee of the Apartment Association of Orange County. Jerry has been involved with apartments as a professional since 1988.

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Rental Housing Journal Colorado

7 Pest Preventative Maintenance Steps ...continued from front page 1 No. 3 - Clogged and debris-filled gutters can make for a cozy hiding spot: making sure that gutters are regularly cleaned avoids this issue.

No. 4 - Regular trimming of trees and plants located next to windows and entryways can prevent branches from allowing pests to gain access to them.

No. 5 - All pests are naturally drawn to food, both inside of homes and as found outside in trash cans and disposal areas. Investing in trash cans and bins made of heavy, tough materials that have tight, sealable lids works best for keeping pests from identifying a property as an attractive, food-secure nesting place. Heavy-duty containers also make it difficult for raccoons and possums to force their way into garbage storage areas.

No. 6 - Some pests can utilize chimneys as access points and nest in attics and roofs. Having a professional install wiring or screens on chimney gaps can block access.

No. 7 - It is fundamental to encourage tenants to be mindful about safe food storage and disposal of

organic material. Inside the home, food should be properly stored inside tight containers and fridges. Garbage should be disposed of in a timely manner.

The lineup of unwanted potential pests Ants Ants are drawn to foods that most humans tend to consume fairly regularly: meat, starches and sweets.

While most types of ants nest and live outside, they can easily detect nearby food sources and once found, they return regularly. In fact, ants release a chemical designed to guide them back to the newly found food source, which also indicates this to other ants in the colony. Infestations can easily get out of hand once the thousands of specimens from a certain colony learn where to go for food, which also increases the likelihood of indoor nesting.

Cockroaches Cockroaches are nocturnal creatures, which makes them much more difficult to spot. Experts warn that in most instances, spotting a first cockroach

is likely an indication of an entire colony having nested within the property. Aside from their unpleasant appearance, cockroach activity can severely affect the health of tenants as their droppings and cast-off skins are known to aggravate asthma, allergies and other breathing conditions. This is a pest preventative maintenance step you should take seriously.

Mice/Rodents Just as for ants and cockroaches, food is the main culprit for attracting mice to human homes. Mice represent a serious threat for the safety of tenants as they can carry fleas and diseases that can be severely harmful to humans, such as meningitis. Tenants can be easily exposed to these harms as mice contaminate spaces with their fur and droppings.

Mice can take over properties quickly because of their year-round, rapid breeding. Their presence can be quite destructive due to their chewing abilities, which can damage furniture, wiring, and even walls.

Raccoons and Possums

Due to their considerably larger size, those pests are better able to defend themselves once they encounter humans and they feel trapped and threatened. For this same reason, they can endanger pets, especially cats and smaller dogs.

Raccoons and possums can also carry rabies, which makes them that much more pressing to invest in proper pest preventative maintenance measures.

Summary: These simple 7 pest preventative maintenance steps can save you a lot of headaches and keep your tenants happy and avoid over-reacting over pests in their rental housing., Keepe is an on-demand maintenance solution for property managers and independent landlords. Keepe makes hundreds of independent contractors and handymen available for maintenance projects at rental properties. Keepe is available in the Greater Seattle area, Greater Phoenix area, San Francisco Bay area, and is coming soon to an area near you. Learn more about Keepe at http://www.keepe.com

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Apartment Amenity Company Partners with Denver

...continued from 1 into a local community and ecosystem of on-demand services,” the release states.

Per their website, Urban Phenix focuses on ‘renovating assets to create a modern apartment experience’ and they are spending the money to deliver on this mission. At Urban Phenix’s Sloan property, all new residents will receive one of three apartment amenity options upon lease signing: • Six months of dog walks, or • Six months of personal training, or

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• One year of cleaning services (multiple per month) Real estate industry experts in the apartment world refer to these services as “soft amenities” opposed to more capital intensive “hard amenities” like club rooms and big screen TVs. Dog-walking, in particular, is becoming a focal point for renters.

As the apartment world is seeing an increase in pet ownership, recent data suggests pets are a key factor impacting leasing velocity. According to Richard Melton, an Urban Phenix onsite manager, the most popular service is dog-walking. The National Multifamily Housing Council (NMHC) delivered a report at Optech 2017 stating 72% of pet owners were interested in having a community dog park, followed by 60 percent wanting a pet-washing station, and 56 percent being interested in a pet daycare service.

Amenify, is a property-centric

real estate technology company that white labels their amenity program and provides hotel-style concierge and support. Amenify does all the work, including resident communications and vetting service providers, making it easy for properties to elevate their brand without monopolizing their staffs’ time and resources.

Amenify creates a white-label program that seamlessly plugs into the operating software used by the property. There is virtually no work for the on-site team, other than leveraging the amenity program as a sales tool for prospective residents.

“Residents choose communities that offer convenience and value, and it’s more effective to deliver an experience with software than to build things onsite. We believe in creating a winwin,” Everett Lynn, CEO of Amenify, said in the release.

Based on initial pilots with Amenify, Urban Phenix is expanding the program to all of its Denver communities in 2018.

Amenify, a privately held company founded in 2016, is a next-generation property-centric marketplace that makes it easy for apartment buildings to offer a suite of local services and experiences. For more information, visit www.amenify.com.

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Rental Housing Journal Colorado · February 2018

Rental Housing Journal Colorado

Do You Know How to Respond to a Sexual Harassment Complaint?

By Ellen Clark HUD aggressively pursues violations of The Fair Housing Act (FHA) involving harassment in housing and complaints often name property managers directly, so do you know how to respond and stay on top of the situation?

Remember courts have consistently recognized sexual harassment as a form of discrimination that violates the FHA. In addition to individual property managers directly, the complaint may name the corporate entity or owner associated with the complainant’s housing.

Any individual or company that has witnessed or experienced housing discrimination, including sexual harassment, may file a complaint with HUD, free of charge

4 ways to respond if you find yourself facing a sexual harassment complaint If a complaint has been filed against you, you will be notified by HUD, and you will have 10 days to respond.

No. 1 – Prioritize mail from HUD Due to the tight window a company has for responding to a complaint, make sure anyone responsible for collecting

insurance company.

There may be insurance to cover the allegations of the complaint. If there is coverage, the insurance company will only be there to help you if they are notified early.

It is a situation we all hope we never have to face. However, in this time of increased awareness around harassment, it is important to have a game plan for a quick and appropriate response to harassment complaints.

mail at your facilities is trained to give mail from HUD priority attention and to forward it to the appropriate person immediately.

No. 2 – Respond to complaints Although filing an answer is not mandatory, it is strongly encouraged.

Responding gives you an opportunity to give your version of the story and provide sufficient information that may convince HUD that it should not pursue the matter further.

No. 3 – Involve legal counsel early

Rental Housing Journal Colorado · February 2018

Because your answer will become part of the official case record and any representations can and will be used against you in future proceedings, it is strongly encouraged that you seek the assistance of legal counsel in responding to a HUD complaint.

In addition, legal counsel can likely negotiate an extension of time to respond.

No. 4 – Notify your insurance company early As soon as you know a complaint has been filed, you should notify your

Ellen Clark is the Director of Assessment at Grace Hill. Her work has spanned the entire learner lifecycle, from elementary school through professional education. She spent over 10 years working with K12 Inc.’s network of online charter schools - measuring learning, developing learning improvement plans using evidence-based strategies, and conducting learning studies. Later, at Kaplan Inc., she worked in the vocational education and job training divisions, improving online, blended and face-to-face training programs, and working directly with business leadership and trainers to improve learner outcomes and job performance. Ellen lives and works in Maryland, where she was born and raised.

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Rental Housing Journal Colorado

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Rental Housing Journal Colorado · February 2018

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