Keys to Multifamily Asset Management for Investors

Resources to help you team up with the right Property Management to make your Multifamily asset flourish!

Todd Heitner

Do you ever use property managers that have their own properties like they maybe own their own apartments?

Anthony Chara

Yeah. We, yeah. We have a couple of times. They’re owners so they have their own properties. Yes. It’s it’s pretty rare but there are some of them out there that do that. Yes.

Todd Heitner

Okay. I just thought they might have a little bit of different mindset if they would treat it like they would their own.

Anthony Chara

In one case “yes.” In another case “no.” As a matter of fact, in one property that one of my students owned down in Abilene, he kept getting these really weird expenses. And he’s telling me that he was thinking about changing the property manager but he was concerned because he might get a manager that was worse. And I said “Well, but what happens if you get one that’s better? And speaking of bad, why do you not like this one?” It goes “Well, she keeps charging me for things that aren’t on the property” and “Well, how do you know? Give me an example.” He said “Well, here’s an example. She gave me a bill because they replaced a sliding glass door on the property.” I said “Okay, what’s the problem with that?” He goes “We don’t have any sliding glass doors.” So that was pretty obvious that she was basically charging him for a repair on a different property. Oh, wow. Well, he didn’t find this out until he fired her because he was trying to get her to, he wanted to expand in Abilene. So he wanted her to go out and find out, tell him who the owners were of these other surrounding apartment buildings because he wanted to start making them offers. And she came back at one point and said “Oh, yeah, well” either she couldn’t figure out who owned it or she contacted them. They weren’t interested in selling. He’s like “Okay, that’s fine.” Well, then finally, two years in, he gets upset with her. Gets rid of her. Brings in somebody new. Goes to the new manager. By the way, bringing in the new manager, he increased his revenue $5000 a month within just a few months of the new manager coming on board.

Todd Heitner

Wow.

Anthony Chara

That’s how much a good manager will actually save you. As a matter of fact, about two years ago he had bought another new property down in Abilene and he was so happy with her performance that he actually gifted her 3% ownership in the property to thank her for helping him find properties plus doing a great job managing the properties. But anyway, he goes to this new manager and he says “Hey, you know, I’ve been trying to contact these managers around the area to see if they want to sell can you tell me or go out and find out who owns them?” She goes “Oh, well, I already know who owns them.” And he’s like “Really? Who?” He goes “Your old manager.” Her and her husband own all the properties. But that now explains why he was getting these charges for the sliding glass doors because she was putting and why their their income went up $5000 a month because she was putting a lot of her repairs for her properties on his budget.

Todd Heitner

Wow. Wow. Yeah, that’s.

Anthony Chara

That’s bad. Yeah.

Todd Heitner

And I can imagine, too, that they’re essentially a competitor too. I mean, they, you know, they’re probably going to give preference to their properties over yours too.

Anthony Chara

So, yeah, that’s the pros and cons of that. That’s a possibility that you need to take into consideration. But the new manager, actually she also owns some of her own properties and and she’s been great. He actually he loves her. And that’s why he gifted her that 3%.

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