Multi-Family Guide » Multi-Family

✦ Sustainable seniors housing in Charlotte

mfguide — Tue, 16 Mar 2010 16:00:06 +0000

The red-brick walls hide features that are expected to earn the building LEED Silver designation, the second-highest of four levels. Extra insulation and energy-efficient windows line the walls. Appliances and lighting earned the government's Energy Star label. Water-saving fixtures and landscaping of native species will cut its water use.

The building’s walking distance from shopping and transit means its aging residents will have nearby services.

via Affordable, green housing will be partnership focus – CharlotteObserver.com.

✦ Strengthening Your Fitness Center Strategy |

mfguide — Mon, 15 Mar 2010 11:36:53 +0000

I’m going to try and feature more of these little operational and industry tidbits as I come across them. Tami Siewruk’s MultifamilyPro tackles the fitness center, an oft-mentioned but undersold amenity. Although there are many ideas, the one I liked best was this hint that more directly engages current residents and does not depend on acquiring the latest machinery or devoting the largest space:

8 Steps to Strengthening Your Fitness Center Strategy

It’s easier to retain residents than it is to replace them – and you’re more likely to keep them if you can keep them using your fitness center. How? Give them more reasons to use it! Many property management companies hold contests, fitness awareness classes and seminars in the center or clubhouse, or feature personal trainers during certain hours. These “fitness-focused” programs not only encourage use, but they help create a center of activity around your fitness center, and lend a fitness-conscious character to your whole community!

via Multifamily Pro.

✦ Operations: MHN discovers (but does not identify) Economic Occupancy

mfguide — Fri, 10 Jul 2009 10:45:57 +0000

Multi-Housing News recently advised that owners need to be aware of “Trade-Off Between Cash Flow and Occupancies“. In other words, MHN just discovered economic occupancy.

“It is a tradeoff between cash flow and occupancies and owners need to address that,” Brad Dillman, quantitative analyst at PPR, tells MHN. “The decision depends on the specifics of the owners situation, the property itself and if there is a minimum occupancy level that needs to be maintained in the loan contract etc.”

While I know that physical occupancy is what drives most property managers because it many owners want a single variable to evaluate property performance, physical occupancy has limited importance in financial analysis. Much more important is economic occupancy, which, similarly to a hotel’s RevPAR, describes the financial efficiency of the actual revenues as a percentage of the Gross Potential Rent (Formula: Net Rental Income/GPR).

I’m not sure what happened with this piece, but either it doesn’t say what it was supposed to, or it’s introducing us to something that everyone should already. know: when conducting analysis of income properties, Economic Occupancy > Physical Occupancy.

[Note: My operating presumption is that when a property approaches 95% occupancy, rents need to climb. If your property is 100% occupied, rents are too low.]