Multi-Housing News - August 2009 - (Page 9)

operations More Revenue with Less Hassle Increase your bottom line with a streamlined management approach By Anuradha Kher, Online News Editor Whether times are good or bad, generating additional revenue can increase a property’s bottom line. How are savvy owners/managers boosting their revenue in this tough economic environment? WestCorp Management, formerly Alliance Residential of Texas, uses technology to streamline bill paying and rental collection. Managing 45,000 units across the U.S., WestCorp Management is part of the Nevada West Development (NWD) group of companies. It has found that automation is impacting its net operating income and the overall bottom line in a positive manner. The company recovered $1 million on utilities when it rolled out the NWP program. “The outsourcing of our utilities and rent bill processing to NWP has resulted in huge cost savings for our company,” says Mark Copeland, chief operating officer of WestCorp. “We no longer process these bills at the corporate or site level, and not having all those additional bodies is a huge advantage. It helps us streamline every dollar and cent.” “There is a cost associated with NWP (an additional $3 to $5 a month per unit). But you can expect additional revenues through gas billbacks, etc. to offset those costs. We see a 20 to 25 percent return on investment on an annual basis.” In a manual system, Copeland explains, they would miss late fees and penalties. Bryan Head, vice president of operations, WestCorp, adds, “Managers can focus on resident retention instead of spending time behind their desks sorting out the bills, putting them into the system and shipping them to the corporate office, which in turn increases the revenue of a property.” Making the Internet work for you Providing free wireless Internet connection across apartment communities can help in resident retention or in attracting a different class of clientele to the property. Charging a fee for the Internet connection can help in generating additional revenue. Cliff Orloff, owner of Riverfront Apartments, implemented Wi-Fi at his property to provide resienue managers then reconfigured our amenity pricdents with free Internet access. Meraki’s solution ing set up to incorporate descriptors like fireplaces, allowed Orloff to install Wi-Fi throughout his 143granite countertops and beautiful views, which taiunit, 20,000 sq.-ft. property in one day. By implelored our offerings to individual customer prefermenting free Wi-Fi, Orloff has seen a different class ences,” says Dreyfuss. “With some units, we found of clientele applying for his property. He plans to features that are more desirable. In others, we found have it across his four properties, featuring 630 that people don’t see the value in what we did.” units, in the near future. Windsor has reviewed 33 properties so far, which “I offer it as a free service because if I charge peoinclude a total of 12,250 units. As a result of the ple, they will expect it to work fast and there will be audits, sales teams know no room for outages, slow exactly which unit has speed, etc. I think the fact premium attached to it that the property is Wi-Fi Managers can focus and why, and are therefore enabled increases the more confident in selling. occupancy. There are no on resident retention “The increased revenue hard numbers to prove it, instead which in turn also comes from the apartbut I know that a majority increases the revenue ment being occupied of residents use it. I think faster. Rent also went up between a property that of a property. for certain apartments,” has a gym and another one says Dreyfuss. that has free Internet conAmenity audits can give nection, most people the sales force visibility into the rationale of each would prefer having Internet,” says Orloff, who adds unit’s price via meaningful amenity descriptors and that it’s a better amenity and it costs less to implepricing reports. Audits can also maximize a properment on your property. ty’s online presence with key features and prices and help develop a strategy for measuring the effectiveAmenity audits reveal missed opportunities ness of specific amenity prices. Another way to boost revenues is to revisit “Amenity audits have been standard practice for amenities across a property and examine whether many years,” says Annie Laurie McCullough of the they are fetching the kind of interest and premium Rainmaker Group. “But we wanted to make the property owner/manager intended. They are improvements to the process and make it more called amenity audits and can help in increasing streamlined. We have now come up with a sevenrevenues up to 5 percent. step process. It’s what property managers have been Emily Dreyfuss, pricing revenue manager at doing, in a more methodical manner. Windsor Windsor Communities, affiliated with The General Communities saw a 3 to 5.2 percent lift in revenue, Investment & Development Companies of Boston, but some of that has to be attributed to overall revrecently worked with the Rainmaker Group’s revoenue management.” MHN lution LROTM Revenue Optimization to boost incremental revenue across Windsor’s properties by conducting amenity audits. MHN ONLINE “First, we realized we were missing opportunities Seniors Housing Project Forges on Despite in both over- and under-amenitizing. Then, we Challenging Economy www.multi-housingnews.com/Paradise reviewed our unit type consolidation to see which units could share a common base price. Our rev- “ ” www.multi-housingnews.com | August 2009 9 http://www.multi-housingnews.com/Paradise http://www.multi-housingnews.com

Table of Contents for the Digital Edition of Multi-Housing News - August 2009

Multi-Housing News - August 2009
Contents
From the Editor
Executive Insight: David Hendrickson, JLL
Market Pulse
Operations
Finance: Green Lenders
Property Management: Mentoring
Development & Design: Green
Profile: AMLI
Market Report: Florida
Kitchen & Bath: Saving Water
Products: Paints & Finishes
Technology: Resident Screening
Perspective: Leasing Practices

Multi-Housing News - August 2009