Developers are beginning to work with property managers earlier in the development process. Typically, developers bring in a property management team after delivery, but some developers are beginning to bring in these teams at preconstruction stages for consultation. To find out more, we sat down with Robert Lopata, president and co-founder of property management firm LBPM, for an exclusive interview. Here he tells us why developers are consulting with property managers earlier and what drives rental activity.
GlobeSt.com: Why are developers beginning to seek property management consultation before bringing a property to market?
Robert Lopata: Developers have started to seek property management consultation during the predevelopment stage of construction, often during the conceptual period where architectural considerations are weighed. Unless the developer is familiar with the local neighborhood, the real time experience of property managers who are active in the particular community provides valuable information that impacts maximum rental value, absorption of vacant units into the market, and tenant retention. Further, operational knowledge of comparable developments enables property managers to comment on strategies to minimize construction and operating costs.
GlobeSt.com: What are the biggest concerns from developers?
Lopata: Generally, developers are concerned about the absorption timeline for units to be rented once the building receives its certificate of occupancy, and about achieving rent projections for each unit type.
GlobeSt.com: From the property management perspective, what design elements appeal to tenants and drive rental activity?
Lopata: These days tenants are interested in lifestyle communities that reflect their personality and character. Most new developments are designed with young renters in mind. These renters typically have not yet started families, and tend to live with other roommates. They prefer buildings with amenities such as fitness centers, pools, lounges, and underground gated parking. Renters are typically attracted to mixed-use developments with commercial tenants on the ground floor – such as restaurants, bars, shops, etc.
GlobeSt.com: Which amenities are most important, and which ones don’t translate to higher occupancy or rent?
Lopata: The amenities above are more building specific. Within the apartments tenants prefer hard flooring, contemporary kitchens with stainless steel appliances, ample closet space within bedrooms, and bathrooms large enough to share. There is no value in fireplaces, large balconies, or carpeting.
GlobeSt.com: Which developers have been most active in seeking help from property managers?
Lopata: Large developers tend to have in-house management, or longstanding relationships with property management firms. Generally, individual developers, or developers who are new to the area, benefit most from property management consultation.