SVN Crossroads is a full service property, asset and construction management firm that was founded on the premise that property management should be an extension of ownership’s philosophy and personality.
“Though we’ve been successful in all management disciplines, property management is our bread and butter and is extremely important to the bottom line, “ says Kirsten Bowersox, chief operating officer of SVN Crossroads.
Property management is a challenging business to enter and especially difficult without an existing portfolio of properties, which according to Bowersox, are most likely owned by the principals of the company. This is why she says to be successful winning new business, you have to demonstrate a winning track record of achieving an owner’s goals – which is different for every owner.
A big challenge to succeeding in property management, according to Bowersox, is adapting to the changing real estate environment while continuing to identify new opportunities for property owners that help them create value.
“For many owners, the thought of changing management companies is like changing your bank—dreadful,” she said. “Unless it’s really bad they tend to stick with the horse they have been riding. So, you have to demonstrate to potential new clients why changing horses is worth their while (creating value by providing a free analysis of their operating expenses, for example) and doesn’t have to be painful (demonstrate how organized a management transition can be by asking appropriate questions, etc.). This obviously includes efficient and cost-effective operations.”
“Which is the basis of traditional property, but in the last couple of years, property management has morphed into quasi-asset management. This is to say the management company is involved in not just the day-to-day operations of the property, but also in the development and implementation of the owner’s strategy for the property.”
She added, “For example, this could include initial due diligence during the acquisition process, management of the real estate tax appeal process, interaction with the municipality for special uses or redevelopment opportunities, and a strategy for deploying capital to achieve the most ‘bang for the buck.’ This is especially true for both non-traditional owners of investment real estate such as banks as well as for out-of-state investors entering the market. And like the industry in general, networking and relationships mean everything.”
There are several important keys to running a successful property management business. A major area that differentiates one property management company from another, Bowersox said, is its responsiveness to its clients, and to its client’s clients- the tenants.
“Even if you can’t answer the question immediately or rectify a problem as quickly as someone would like, a quick call or e-mail to say, “I understand…I appreciate…I am working on a solution…” speaks volumes to a client or tenant. Everyone wants to be heard and know that their issue is important to someone.”
Has technology changed the way they do business?
“In my opinion, the use of technology should complement traditional property management not replace it, “ Bowersox said. “We like to talk to our clients and tenants, see them in the halls and actually engage them in conversation.”
“Being responsive to the vendors you rely on to meet the needs of your clients is hugely important as well,” she said. “Show your appreciation by giving them more business when they do a good job and provide constructive criticism when there is a need for improvement. Your business is reliant on their ability to meet your needs.”
In order to be successful, Bowersox said a property management company needs to attract and retain talented and sophisticated personnel who are nimble to the changing conditions.
“Property management can be stressful and thankless,” she says, which is why she feels that the most important key is developing and maintaining a fun and open corporate culture. “There is always a delicate balance between keeping your employees busy, but not overwhelmed. You need new business to generate fee income to support hiring additional staff, but you can’t pull the trigger until you’ve earned the business.”
At the end of the day, employees need to know that hard works pays off – “they can have a voice in how the company runs, opportunities to improve processes, career advancement and growth, and of course, financial incentives– and when the company does well, so do they.”