As we continue our series on properties in receivership, we move onto weeks three and four. The first two weeks, as highlighted earlier on our blog, focus on taking control of the property, informing the tenants and re-aligning the staff and processes to better market and manage the complex.
Week 3 – The transformation has begun. Now the goal is to require disciplined payments, and improve the desirability of the property while keeping expenses minimal.
- Trees and bushes are removed or trimmed to make the property safer and look younger.
- Signs are touched up.
- Buildings are power-washed.
- A daily litter patrol is established.
- Models get a fresh coat of paint, a deep cleaning, and a few new touches.
- Leasing and closing techniques are refreshed.
- Renewal and referral programs are implemented.
- Collections are activated and 3-day notices are served for any and all outstanding balances.
- First evictions are filed.
Week 4 – The leasing team focuses on evaluating and building prospective tenants; the operations team focuses on creating and selling more desirable rental units and getting routine maintenance requests under control.
- Sources for leasing prospects are tracked and evaluated – basically benchmarked, so that 30, 60, and 90 days sources can be retooled yielding the highest rate of return.
- The leasing team begins to canvas the neighborhood businesses, and larger businesses within driving distance, to offer incentives for their employees to rent at the property.
- Leases are audited for completeness and accuracy. Updates are initiated as needed.
- The operations team conducts inspections of “market ready” units to continue to improve and train the maintenance team as to new standards of delivery.
- Typically, the property has dated tenant maintenance requests due to past insufficient funds. For the first few weeks, triage is done to address the most significant issues. By week 4, maintenance can begin to tackle more routine issues in an organized and efficient manner. Additionally, protocols and standards are established for best practices.
- A first draft operational budget is established as it is rare that an existing budget or recent financials are discovered in the old files.
As the first month comes to a close, the property has significantly improved from day one and existing and prospective tenants have noticed these changes. Watch for the final receivership blog in the coming weeks.