In the management industry, tenants aren’t the only ones coming and going; owners commonly “move” their properties between different property management companies until they’re satisfied with a service. Bringing buildings and entire portfolios under new management is a process well worth proper preparation, so here are five steps I always take to ensure this all-important transition goes smoothly for a new client.
1. Know Every Owner
I recommend developing a strict protocol for transitioning into new management, but it’s also essential to remember that all owners are unique. Begin your professional relationship with a property owner by going out of your way to learn exactly what their expectations and priorities are. My team includes an onboarding coordinator whose explicit responsibility it is to walk new clients through what we call a Management Transition Profile (MTP), which is a series of questions that tells us all of the details of their portfolio: simple things like their policies on pets, as well as more complex matters like where we should pay their utility bills and whether they’ve registered with any necessary local agencies.
2. Call Every Tenant
Deliver every tenant a notice of the change in management — of course, this needs to be in writing. But you should be more than a letter in their mailbox. Go beyond the paperwork and call every tenant whose unit you’re going to manage. These phone calls can lay a strong foundation of trust for future communications with tenants, and start things off on the right foot.
3. Inspect Every Unit
As soon as you’ve taken on a portfolio, arrange with the owner to walk through each and every unit of their property, and encourage them to join you if they can. Both you and the owner may be shocked at what you find during these inspections. We once found that under previous management, a tenant had gotten his third-floor balcony removed, but had left the door to the balcony intact — good thing we didn’t rush through it. In another instance, we found evidence of carbon monoxide in a unit. Bring a maintenance supervisor to these walk-throughs so that they can note anything that requires immediate attention (health and safety issues), and also make a list of potential future projects.
4. Audit Every Lease
This goes hand-in-hand with learning everything you can about your new client and their portfolio. Learn the details of all their lease agreements so that you can properly enforce their policies. You may find that one tenant’s lease comes with a limit of two occupants while you’ve learned that four people live in their unit, or that all the owner’s leases prohibit pets while you’ve found that a tenant keeps several cats in their carpeted apartment.
5. Review the First Statement Together
Have the owner’s designated property supervisor actually set an appointment to walk them through the first statement they receive from you. This will go a long way, as many property owners dread having to navigate a new management company’s itemized statement on their own.
Transitioning units into your care is the first task a new client will see you complete, so make the right impression by taking all of these steps and showing them how thorough you’ll be in the management of their property.
David Crown is the Chief Executive Officer. of Los Angeles Property Management Group, and has over twenty-five years of experience managing all types of income properties. Having managed properties in 16 states, Mr. Crown has been asked to serve as an expert witness in property management matters, and currently serves on the Forbes Real Estate Council. He can be reached directly at (818) 646-815.