The Real Estate Thinker

Roundtable Hopes to Spur Investment in Low-Income Communities

real estate thinker — Wed, 12 May 2010 14:43:17 +0000

On April 29, 2010, ValleyWide Real Estate & Asset Management and the Urban Land Institute hosted a roundtable discussion to educate local investors about the New Markets Tax Credit (NMTC) Program. The NMTC Program is administered by the US Treasury Department and provides tax incentives to encourage investment in low-income communities.

Roundtable discussion leaders included representatives from The Reinvestment Fund (TRF) and Vince Bekiempis. Mr. Bekiempis reviews applications on behalf of the US Treasury and TRF is an investor in projects that qualify for NMTC. Ed Powalski, Mayor of Allentown, offered some opening comments, as did Cindy Feinberg, Director of Economic Development for Lehigh County. The session was well-received and informative for the 40 participants.

Since the NMTC program was established in 2000, several projects in the Lehigh Valley have benefited from its incentives and more are anticipated in the future. Nationally, the Fund has made 495 awards totaling $26 billion in allocation authority. To qualify for awards from the Fund, an organization must demonstrate that its primary mission is serving or providing investment capital for low-income communities. Please contact Howard Graeffe, President of ValleyWide, if you would like more information.

SECRETS: Real Estate (Brokerage) Company or Property Management Company – Part 2

real estate thinker — Mon, 15 Mar 2010 14:59:15 +0000

So we recently posted about the differences between real estate companies and property management companies. But we didn’t say anything about how to tell them apart. As we said before, there’s nothing inherently wrong with a real estate brokerage company, but as a customer, you’d probably prefer the specialist, right? Start out on their website (the do have a website, don’t they?! If not, I’d be getting worried). They might tell you straight out on their “About Us” or “About the Company” page. Also, look at the website itself: does it seem to be selling property management or is it all about property listings and leasing? Finally, don’t be afraid to ask. Find out which came first and ask about the qualifications of their property managers and how many properties or associations the company manages.

SECRETS: Real Estate (Brokerage) Company or Property Management Company

real estate thinker — Thu, 11 Mar 2010 12:48:25 +0000

Real estate company versus property management company: what’s the difference? Well, it’s really a matter of how the organization began and what their corporate mindset is, so to speak. A true property management company started out in the management business, and has management at the core of their service model. They may provide other services as well, but property management always comes first; it’s their core competency. On the other hand, a lot of real estate companies have recently discovered that there’s money to be made by picking up some property management contracts. It’s not their primary focus – selling and leasing real estate is what they really do – so managing properties will never get the attention it deserves. Moral of the story: if you think your building or association deserves the best possible management, stick with a property management company.

SECRETS: Proactive Management

real estate thinker — Wed, 03 Mar 2010 16:13:14 +0000

Do you only hear from your property manager when there’s a problem? That’s reactive management: picture them running around “putting out fires”. Wouldn’t it be nice if they spent a little time trying to avoid the blaze in the first place? Maybe be proactive for a change? Funny thing though, it’s actually more cost effective to keep things running smoothly rather than pick up the pieces once the wheels have come off. It’s all about preparation: capital budgets, planning ahead and checking in every once in a while to make sure everything is running smoothly, and communication.

So, would you say your property manager is proactive or reactive?

SECRETS: Third Party Vendors

real estate thinker — Fri, 26 Feb 2010 15:16:31 +0000

Suppose your car mechanic used cheap parts to fix your car because he was getting a kickback from the part manufacturer. You’d be a little bit steamed, right? Now suppose that your property management company was receiving a commission for recommending third party vendors for snow removal, landscaping, HVAC, etc. Some property management companies will only recommend a vendor if they get something in return. Shouldn’t property management companies recommend the best vendors and contractors they can find?

Here are a couple of questions to ask your property manager:

How do you qualify third party vendors?
Do you follow up with your clients to see if they were satisfied with a vendor?
Would you use these vendors yourself?

SECRETS: Commingled Funds

real estate thinker — Tue, 23 Feb 2010 13:10:07 +0000

Did you know that most property management companies commingle operating funds? That’s when they take the money from your association or property and dump it into the same bank account with all the other associations and properties they manage. Wondering why they do it? Because it’s to the property management company’s benefit – not yours. They get the incentives and you don’t. It’s not their money, but they’re cashing in on it.

Of course, there’s nothing wrong with getting incentives from the bank. But the associations should see the benefits, not the property management company.

Ask your property manager whether they use a commingled fund. If they do, find out what benefits they’re getting and demand your fair share.

Shhhhhh! – Secrets that Property Management Companies don’t want their customers to know

real estate thinker — Fri, 19 Feb 2010 14:11:59 +0000

Over the next few days we’re going to let the cat out of the bag. We’re going to share the inside scoop about some of the shadier practices property management companies engage in. There are plenty of things they’d rather you didn’t know, and we’re going dish.

Delinquent Accounts

real estate thinker — Mon, 01 Feb 2010 16:13:41 +0000

Times are tough and your money doesn’t cover what it used to. So what happens if you can’t make your dues payment? When you miss an Association fee payment it is considered an automatic lien on your home. This lien must be cleared before you sell your home. So what do you do? Contact your Property Manager as soon as possible and discuss payment options. It is always good idea to talk with them so that your debt doesn’t accumulate and get out of hand.

Commercial Real Estate Owners: Cut Costs and Boost Occupancy!

real estate thinker — Mon, 23 Nov 2009 20:09:06 +0000

In financial times such as these it is imperative to cut costs wherever the opportunity exists. It is important now more than ever to spend less to remain competitive in the marketplace and better support your tenants. Finding the right property manager to work with you to achieve this goal is one of the keys to the success of your real investments.

Most commercial real estate owners don’t think much about their tenants’ occupancy costs. Why should you? These costs are paid by the tenant in the form of CAM charges or direct billing so there is little incentive for the owner to identify and implement cost savings to their tenants. Maybe in flush times you can get away with that attitude, but in a down market, wouldn’t you rather do a little extra to keep tenants instead of trying to find new ones? Happy tenants want to renew leases, tell their colleagues about the benefits of being a tenant in your building and ultimately can help to keep your building(s) fully occupied.

This is where your property manager can help. If you’ve signed a quality property management company, they’re already concentrating on tenant relations. The underlying philosophy is pretty basic: management of the daily costs saves both the tenant and the owner.

If your property manager isn’t already on top of things, schedule a meeting to discuss ways to minimize tenant costs as a way to improve tenant relations. We urge you to really question them about their approach related to managing these costs: Is there a program they can implement? How can you save costs? Do your tenants have concerns and/or ideas to hold the line on costs? If they still don’t get it or can’t offer any ideas, it’s time for a new property manager.

Fundamentally, it comes down to securing a competitive advantage, or a least negating a competitive disadvantage. Think about it: Do you want poor relations and high costs dropping your property to the bottom of the list? Turnover might be good for your real estate agent, but it’s expensive and disruptive for you. Find a way to work with tenants to meet their needs, and you’ll find your building occupancy and property value going up.

The best FREE HOA Board Member Seminar you just missed!

real estate thinker — Thu, 15 Oct 2009 13:31:00 +0000

Last weekend, ValleyWide Property Management co-hosted a FREE seminar for homeowner associations with Luft & Company, CPA’s and Boughal and DeVito, Law Firm…

ValleyWide’s Property Manager Actors Guild (no acting experience or ability necessary!) opened with a skit entitled “What Not To Do At an Association Meeting”. Everyone in the crowd was able to relate and got a good chuckle.

Next up was Todd Luft, CPA of Luft & Company, with a presentation that covered accounting and financial issues faced by associations. It was pretty impressive how he took such a dry subject and turned it into a fun and informative presentation. We couldn’t believe how many board members were taking notes!

Batting cleanup were Wendy Nicolosi and Leo DeVito from Broughal and DeVito. Wendy and Leo shared a variety of ways to deal with delinquencies, foreclosures, and bankruptcies. As usual, Wendy was the informative transactions attorney and Leo was the rockstar energizing the group.

Every year ValleyWide hosts an event like this to give back to associations and board members throughout the community. This is what we mean by being a “learning organization,” both for our managers and our clients. Not only do we share some of what we’ve learned over the years, but the attendees get to know us better, too. And, not for nothing, they also get to meet board members from other communities and share stories and experiences with them, which can be fun and remind people that plenty of other folks are facing the same challenges they are.

Finally we’d like to thank everyone who participated, both the presenters and the audience. Being a board member can sometimes be a thankless job, so our hats are off to you for going the extra mile.

P.S. If you’re in the Lehigh Valley area and would like to join us next year, please shoot us an email and we’ll add you to our mailing list. We promise: no spam!