WS1082: How to Operate Your Multifamily Property with More Profit and Less Stress with JC Castillo

Have you ever heard about the “who not how” idea? It is about getting people that can help get things done for you so you can focus on the things that matter most and that is to grow your business. In this episode, JC Castillo of Velo Residential shares valuable tips on how you can operate your multifamily property with more profit and less stress.

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Listen to the podcast here:

JC shares three things that revolve around the profitability of a multifamily business: have a happy and committed onsite staff, make sure to give an amazing customer experience, and it is all about key performance indicators (KPIs). He also highlights the importance of doing the basics brilliantly. Listen now and start making more profits!

Key Points From This Episode:   

  • JC talks about his third-party property management company for large-scale multifamily properties, Velo Residential.
  • Profits are beneficial to both the property owner and the tenants.
  • JC shares that he has focused on the third property management company and how they are helping owners to maximize profits.
  • How are owners struggling to hit their profit goals?
  • The three things revolve around the profitability of your multifamily business.
  • Hiring VAs can eliminate unnecessary work for your onsite staff.
  • Be on top of your game by doing the basics brilliantly.
  • What are the processes in property management that can be automated?
  • JC shares the app that they use in property management — Appfolio.
  • What are the biggest problems the owners face in operating their business?
  • How does JC prepare for a downturn?
  • JC shares advice on how you can get reviews from your customers — ask for it!
  • JC’s predictions in the real estate market over the next six to twelve months.
  • The daily habit that helped JC achieve success in property management and multifamily business — constantly think of a way how you can make the life of your onsite staff live’s better.
  • How does JC like to give back?

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“No matter what, profits are not just good for the owners. They’re actually great for the residents because when you have a profitable property, you as an owner are able to put money back into the asset and give the residents a great customer experience and a great place to call home.” [0:02:50]

“Your profitability revolves around a happy and committed onsite staff.”  [0:05:16]

“A happy resident means they’re gonna renew their rent. When they renew their rent, that means thousands and thousands of dollars right into your pocket, every time.” [0:12:59]

“You have to have a simple set of KPIs (key performance indicators) that tells you — am I tracking my metrics for this year, for the budget?” [0:18:19]

Links Mentioned in Today’s Episode:

JC Castillo on LinkedIn

Velo Residential website

Operate For Profit

Appfolio Property Management Software

About JC Castillo

JC Castillo is the President of Velo Residential, a third-party property management company servicing multifamily owners in Dallas Fort Worth. JC helps owners take control of their operations so they can stop stressing out and start making more money. Over the past 15 years, his companies have acquired, repositioned and property managed thousands of apartment units in Texas. Be sure to check out his podcast – Operate for Profit Real Estate Podcast.

Full Transcript

EPISODE 1082

[INTRODUCTION]

0:00:00.0 ANNOUNCER Welcome to the Real Estate Syndication Show. Whether you are a seasoned investor or building a new real estate business, this is the show for you. Whitney Sewell talks to top experts in the business. Our goal is to help you master real estate syndication. 

And now your host, Whitney Sewell.

00:00:24.000

Whitney Sewell: This is your daily real estate syndication show. I’m your host, Whitney Sewell. Today our guest is JC Castillo. And, JC brings today some value to you and to me, I mean he really brought so much to the show today. I’m excited for today’s episode and I hope you learn a lot. A little about him, he’s been on the show on the show before but he’s taken kind of a pivot in his career at the moment and is focusing on something else. And we’re gonna get into that in great detail today.

JC Castillo helps multifamily owners take control of their operations so they can stop stressing out and start making more money. Over the past 15 years, his companies have acquired, repositioned and property managed thousands of apartment units in Texas.  He hosts the podcast, “Operate for Profit Real Estate Podcast.” 

He goes through a few things that are so crucial to help you to become more profitable as an operator. I don’t wanna give it away right now ‘cause I hope that you will listen to the show ‘cause he goes into so much detail. Forgive me, I know the show’s a little bit longer than normal but he just brought a ton of value and I had some spare time so I wanted us to keep going because I know it’s gonna be so much beneficial to you. Whether you are a passive investor or you’re the operator, you’re gonna learn a lot today. It’s gonna help you on the management of your property and ways that you can become more profitable.

[INTERVIEW]

00:01:47.0

WS: JC, welcome to the show. It’s always a pleasure to catch up with you. You are one of the smartest people in our industry. I think just after a few interactions with you, like man this guy knows what he’s talking about. And you’ve got a lot happening that I’m looking forward to getting into today.

But right off the bat, why don’t you give us an update about yourself or your business, some new things that are happening and let’s dive in.

00:02:06.0

JC Castillo: Well, Whitney first of all thank you for having me on the show. It’s great to be back and it’s been so great to see your show explode. As far as, as far back as I can remember, you’ve been so committed to the show. And it really has shown with the traction so congratulations.

Since we last spoke, really the biggest thing that we’ve got that I’m super excited about is we have launched a third party property management company for large-scale multifamily properties. The name of the company is called Velo Residential and we are opening up shop as a third party management provider in Texas specifically in the Dallas, Fort Worth area. And so you know really Whitney, what it is all about with me and for the last 15 years what it’s been all about for myself and also for other owners it’s about maximizing profitability at these properties Whitney. I always like to say that no matter what, profits are not just good for the owners. They’re actually really, really great for the residents because when you have a profitable property, you as an owner are able to put money back into the asset and give the residents a great customer experience and a great place to call home. So we really have to, as an industry and also as a nation I think Whitne,y I am really passionate about making sure that people understand that apartment owners being profitable is a good thing for everybody, not just the owners.

00:03:18.0

WS: Yeah, wow, love that that is profitable for everyone, including the tenants right, and your investors. And I just mean when you can have somebody like yourself on your team as that property manager that knows what they’re doing it just makes the biggest difference right. It helps you to sleep better at night, whether you’re the passive or whether you’re the operator.

But one question about that, you launched a third party management company, are you still focused on buying as well or is this a complete shift?

00:03:42.0

JC: Well, you know, look, my heart has always been as an owner, buying properties. I bought properties, renovated properties, you know, operated properties for a very long time. Luckily, with my private equity company that has a lot of great partners that I’ve been able to add to the team. And so, I’ve really stepped back from that piece on the day to day side, and still haven’t left the company, but really have amazing partners that are completely taking over and running that thing for me. 

So, really what it is all about for me right now is really focusing on the third party property management company and how we are helping these owners who honestly speaking need help on the management front to maximize profitability at their properties and that’s what I’m all about these days Whitney.

00:04:22.0

WS:  Let’s talk about that in greater detail. JC, you know, helping others increase their profits and, you know, let’s talk about some ways you’re doing that or maybe how you see owners struggling right to hit their profitability goals?

00:04:35.0

JC:  Yeah, Whitney it’s such a great topic and I know it’s near and dear to your heart as an owner and as an operator. And it’s near and dear to many of your hearts of your listeners who are all in the multifamily space in some form or fashion either as you know passive investors as you said, or as active owner operators or as you know LPs or GPS really at the end of the day, what I found Whitney, and I found this out sometimes the hard way from doing face plants and sort of learning by failure is I’ve learned that really profitability, maximizing profitability revolves around three things really it’s very, very simple three things. And your listeners should really write this down because these are the three things that revolve around.

Number one, Whitney, is your profitability revolves around a happy and committed onsite staff. I repeat that, a happy and committed onsite staff. So, Whitney, if you have a frustrated staff at your property that has no leadership that is buried with a bunch of back office functions and tasks that don’t have really anything to do with taking care of their residents, then you’re going to have a lot of frustrated onsite staff. You’re going to have turnover, you’re going to have people coming and going. And ultimately, that is going to really knock you with your profitability and it’s going to really sink your ship. So, the number one thing, Whitney, for people that are looking out there to know how to maximize profitability is, you have got to focus on your onsite staff, how you are making them happy and how you are limiting a lot of their back office work that actually really drives them crazy. And these days with technology and virtualization of humans isn’t necessary anymore. And so, the way that you solve that problem has a lot to do with how happy your staff are going to be. So that’s number one.

00:06:17.0

WS: Could you elaborate on maybe a couple of those tasks that you’re eliminating that do make them crazy? Maybe as an owner, you’re kind of blind to it right, you don’t even see that that’s something that hey I could do that, a different way so they’re happier, right? What are a couple of those things?

00:06:31.0

JC: Oh gosh, I love it. I can give you many, but let’s talk about two very, very simple ones because I love to keep things simple. Number one is, I almost could guarantee you, Whitney, that most management companies have the actual invoicing, so accounts invoicing, accounts receivable, they have the onsite staff putting the invoices into your software system. Whitney that is completely unnecessary. You should have a virtual team of virtual humans and international locations that are getting the centralized invoices sent to an email alias and they are entering these invoices for the office staff. The office staff have no value taking all of their time and entering all these hundreds of invoices that can come in per month. Instead what you want to do is you want to farm that out as well hopefully your management company does farm that out and have a centralized system, which actually will take that work off of the onsite staff plate. Now, the other benefit of that is you can actually train the invoice processing agents exactly how to properly code up an invoice. One of the things that drives me crazy Whitney as an owner and I know it drives a lot of your listeners crazy is looking at the P&L’s and going, “what in the world, why are these things being categorized like this?” And nine times out of 10 it’s because the onsite managers who have no background in accounting or bookkeeping are being asked to do complex invoice entry. And really it doesn’t need to be done because A, they get it wrong and B, they don’t have time for it. So invoice entry, Whitney is one thing that we as a company have offloaded completely to a virtual human workforce and also through AI bots. 

Another example I can give you a real simple one is guest cards. Okay, these are these prospects that are interested in renting at your property. So if you have a property let’s say Whitney you’ve got property, you know XYZ apartments in Dallas, Texas, and you have a Google business listing. Well, there’s going to be hundreds of people calling in or emailing into your Google business listing or your website and inquiring about leasing a unit at your property. Now, Whitney, let’s just say that there is a working mom, who has two kids, and she’s tired and she gets home from work at nine o’clock at night Whitney, and she needs to find a place to live, and she comes across your ad. And she’s really interested in the property and the pictures look great, so she goes and places a call, Whitney, to lease a unit at your property now remember it’s nine o’clock at night on a Wednesday. She’s going to get a voicemail system at your property, and it’s going to say, “Hey, thanks for calling XYZ apartments will get back to you as soon as we can.” Guess what, Whitney, tomorrow morning your manager comes into the office Thursday morning. She’s going to get all of her you know morning activities done, she’s going to grab some coffee, catch up with the maintenance guys. You’ll be lucky if she returns that call around nine or 10 o’clock in the, in the, in the next day. Now, by that time this working mom who’s tired and is probably at her job Whitney, and she probably has long since forgotten that she was interested in looking at your property so by the time you actually connect with her. The chances of you closing that lead have dropped significantly. Now imagine instead Whitney, that we had an artificial intelligence spot, called Lisa, which our company does. Andthe minute that she called in at nine o’clock at night on Wednesday, she got a text message back on her cell phone that she called them and said, “Hey, thank you so much for calling in about XYZ apartments, we’ve got one and  two bedroom units available. Would you like to schedule a tour with us?” 

Now Whitney, what you’ve just done is two things: one, you have taken immediate action on a hot lead and everybody knows that if a hot lead sits for five minutes these days, it goes cold, your chances of closing go way down, but more importantly, Whitney, think about this, your onsite staff are getting 10 and 20 phone calls, probably per hour and some definitely per day of a bunch of people that want to lease units at your property. Now how many of those phone calls do you think they can actually handle and actually handle properly and actually have the bandwidth to really focus in and ask and give the q and a that this person is looking to answer the question? The answer to your question is not many. And not only that, but it’s going to drive your onsite staff crazy because imagine you’re at the leasing office and your phone is ringing off the hook non stop, you can’t even really catch your breath to get some peace and quiet to figure out what you need to do for the day, and all the other high party stuff is going to get lost and dropped. 

And so, you know, Whitney these sorts of things are seem like small things but they are major because what they do is A, they give the customer immediate response to take action and B, they take the stress and the back office functions off of your onsite staff plate. So they can really focus on collecting rents, showing units and getting the service request done which is what they need to be doing.

00:11:23.0

WS: Now that is awesome. Yeah, they can’t take those calls because they’re too busy uploading those invoices right. 

00:11:27.0

JC: Yes.Yes, that’s exactly right. You got it, Whitney. 

00:11:31.0

WS: I appreciate just the depth that you went, I mean just thinking through that right. And I think a lot of people don’t even realize that those things are available, virtual assistants we’ve talked about and these people who are very talented and have skills that you know can do so good you know at those tasks, right.

So, looking at using virtual assistants that listeners can look up on the show. I’ve talked about it so many times. I hope you are considering it, if they haven’t already. But okay, great. So manually entering invoices and in these guests cards using bots such a great idea in the scheduling function like you said, I mean immediately they’re getting a text message its own her mind right then she even got to look at anything else on the phone yet, right she said in and all of a sudden she gets a text message she can schedule it right there it’s so good. What’s number two?

00:12:20.0

JC: Well, okay so just to recap right because we went deep on number one, but number one is happy on site staff. Number two, Whitney and I think you’re going to appreciate this also, you have to have an amazing customer experience. Now I’m not talking about the owners, I’m talking about the residents. Because residents, let’s face it, owners, ladies and gentlemen, they are your customers, and we like to call them our customers because they do have a choice and they decide to limit your property.

Now, the customers, having a great experience is going to mean one simple, simple thing. Okay. And let’s not forget this is very important people, all the people listening to Whitney’s podcast. A happy resident means they’re going to renew their lease. When they renew their lease. They’re going to drop thousands and thousands of dollars right into your pocket, every time they renew their lease, thousands of dollars. Let’s talk about that. Look, when a resident, you’re going to put five to $10,000 bucks to upgrade a unit if you’re doing value add properties right. You put five to $10,000 you market the property you get that resident in there and they’re real happy they love the unit. And the minute that they move in, if they’ve got terrible customer experience, if they don’t have a modern management platform to pay their bills online. If they don’t have a work order system that gets their workers done, you know significantly fast and pretty much done the right way. They’re going to basically say hey you know what this is a great looking unit but I’ve got terrible service and when my lease is up, I’m leaving.

Well, as soon as they leave, you got to return to that unit. You got to spend, you know, meet your maintenance people’s precious time to go turn an extra unit. You’ve got to market the property, you’ve got to put all of the costs into turning the property. So, you know, sitting vacant for 45 days when you add all that up you’re talking about four or $5,000 bucks in many cases, including all the hidden costs of a person moving out.

Now, resident experience doesn’t have to be complicated. And I think, Whitney, that’s one of the things that I want to talk to your listeners about is that I like to keep it simple like I call it, doing the basics brilliantly. Okay, it’s called fundamentally being a sound blocker, and a tackler, things like getting work orders done. We actually have a system where any one of our residents can actually whip out their iPhone, and by the way, everybody’s got an iPhone these days, whip out their iPhone, take a snap a picture of a broken toilet bowl, and they can send it by text to our maintenance call center, and a work order will be automatically filled out anytime of the night or day. And we will have that in our system and then we will take care of it. If it’s an emergency, obviously we may respond that same day whether it’s day or night but usually if it’s a non emergency we will be there in the morning to take a look at it and close that work order.

So Whitney put yourself in the place of a you know a resident or a customer and think about the power of taking out your phone taking a picture and putting a worker, you don’t even have to go to your portal, you don’t have to log in, you don’t have to call the one 800 number, you don’t have to walk into the office which, believe it or not, many offices still require people to walk into the office to submit a work order like physically walk in which is just craziness if you’re in the management business. But, when you make it so easy, you know, to service a work order for that customer, that tells the customer that you really care about their time and about who they are as busy people with their own lives. And, Whitney, that’s when the magic of the renewal starts to happen because if they know that you really care about them, people don’t expect perfection. People know that things are going to go wrong. What they really expect is when something does go wrong, that you’re going to be there for them in a reasonable amount of time and you’re going to fix it.

And so Whitney, you know, customer experience is really the key number two key to driving profitability because it’s such a seemingly simple thing to do. But because people try to overcomplicate it, they fail. And so if you can get it right, profitability will soar because you’re saving so much money with renewals.

00:16:15.0

WS: We often overcomplicate things right and even the example of tenants have to come into the office to, you know, have some kind of maintenance requests or whatever. That’s not only wasting their time but I mean, even that staff that we were talking about earlier right, I mean it’s wasting their time as well, you know, just the whole thing man if they can just text a photo. “Hey, I’m in the unit whatever” And you’re probably going to know that by their phone number right. And so it’s just man that just really streamlines things and I can guess why they’re going to love that right they don’t want to go down to the office and talk to anybody.

00:16:43.0

JC: Yeah and you hit the nail on the head and that’s the other piece of this is that all of the innovation that we do for better customer experiences also has a huge impact on the onsite staff’s ability to support and be more happy because like you said there’s less people coming in for things that can be done in a more efficient manner anyways. Now, you always want to give people the option right. So people can call in, they can go to the portal or they text the picture and send it in. But these sort of things are called a modern customer experience, and making it simple, is not just using technology for the sake of it being sexy but actually using technology that makes it simpler and easier to do business with your customers and that is where you really have to be committed as a management company to push the envelope.

00:17:31.0

WS: Love that. Well, what’s number three or is there a number three?

00:17:32.0

JC: Oh there absolutely is number three. Number three is, it is all about the KPIs Whitney, key performance indicators as people probably know that term it’s become a lot more more popular these days. But as an owner and I’ve been an owner for you know for a long time, you know, with the management company it’s the same thing at the end of the at the end of the month, once close out happens typically between the 15th and the 20th of the, of the preceding month, you get a download of reports you know you’ll get 10-15 pages of reports it’ll tell you how your properties doing well. Let’s face it, Whitney, we as owners really don’t have time to go through such volumes of reports to know how our properties are doing. And we also don’t want to have to wait until the end of the month. So, one of the things that you need to be focused on if you really want to maximize profitability of your property is you need to have a simple set of KPIs that tells you, am I tracking my metrics for this year for the budget on some simple metrics right. So income total income so meaning rents plus other income plus utility bill backs. You set out a budget month over month when the year started. Are you hitting that month to date number and are you hitting that year to date number for income coming into the property?You just want a simple bar chart that’s either red or green, and it tells you red, you’re not hitting your numbers or green you’re hitting your numbers.

Same thing for expenses, I’m talking about operating expenses and not offering expenses. You want a simple chart that says, here’s my month over month expenses per budget. Here’s my, my actual expenses per budget both per month to date and year to date. Is it red or is it green? Projected occupancy versus current occupancy. You don’t just want to know what your current occupancy is, you want to know projecting into the future. What is your future occupancy 60, 90, 120 days out because you’re going to have to start marketing ahead of time. It’s too late once the current occupancy has dropped, it’s too late. You want to get started ahead of time.

I can go on and on, but you don’t need many KPIs. The objective is to keep it simple, but don’t be concerned with looking at the volumes of data. Just be concerned with looking at the reds and the greens. And if you’re hitting your greens, try to ignore those as much as possible and focus and go dive deep on the reds and go problem solve those areas because that’s where you’re going to make your profits happen, is when you fix what’s broken. But if you don’t know what’s broken. It’s really hard to fix it. So KPIs, Whitney are my number three tip. That’s something we’ve put a lot of thought and effort into the otter management company. But as an owner, you’ve got to figure out how to have your KPIs in order and if you can have it interwoven with the way that the management company releases the information even better.

00:20:17.0

WS:  If you’re not tracking it you can’t fix it right you don’t even know what’s broken. So, how much of that process can you automate?

00:20:20.0

WS: Well, it just depends on what type of management company you’re working with and what type of software package that you’re working with. For example, these days, there are a lot of different modules, plugin modules that are out there, it depends on the software that you’re using. We use a software called Appfolio, Appfolio property management software. And as part of their software they offer a plugin module where it’s an Excel plugin module and you plug it in and you hit a button and you update all of these different charts to Excel, which are feeding the data off of your background database. We’ve spent a lot of time writing a lot of different custom formulas and stuff, but also making it very simple with just very simple bar charts to tell you red and green. Are we hitting our budget? Are we not? And we share those on Tuesdays and Thursdays with our ownership teams, so that they actually know exactly how we’re doing and we also share those same reports Whitney, with the onsite staff because believe it or not, I think one of the things that people miss also is, we tend to think that the financials are really what we need to be sharing with the owners, but you know, If we make it simple enough with bar charts these onsite staff are also very, very able to really get bought into the idea that profits are what we’re all after. 

And so, by sharing this performance data and letting them know that hey, the bottom line is, we’re in this thing to make profit and here’s where you stand. I think that really gets buy-in from them in terms of what we need to be doing as a team to make it work.

00:21:47.0

WS:  No, that’s awesome. I appreciate you elaborating on that and even to the transparency from the property management company to the owner, right, you said Mondays and Thursdays you’re sharing that document or just KPIs are you red or green, and just having that pulse right. I mean twice a week, I mean here’s where we’re at, right, that that’s such good information and not making it too complicated. I find it you know like if you get this big, massive thing of numbers and I mean it’s hard to even know what you’re tracking right, which things, am I looking at you know and then it’s easy to miss things and it’s hard to track but it sounds like you’ve simplified that process so hey we know for red or green on these few things.

00:22:21.0

JC: I mean, if we take and we think about it profits are simple right, it’s an income, minus expenses and we could call them operating and nonoperating expenses right so you got your operating expenses then you got your capital items. If you subtract the non operating expenses in the operating expenses from your gross income, Bingo! You’ve got your profits. So KPIs shouldn’t be too complicated. You know this is what the business is all about is driving profits so if you know those things you know how your business is doing.

00:22:45.0

WS:  Now that’s incredible. Is there a number four, and we probably want to do that one kind of quickly before we’re going to run out of time.

00:22:52.0

JC: Oh I’ve gotten those. Those are my top three. We can dive into areas if you like.

00:22:55.0

WS: No, that’s incredible. And what about one of the most problems owners you’ve had to work with, don’t give their name of course, but what’s the big thing that kept them back from automating these things is pushing into these directions that you know are going to help them to be more profitable?

00:23:08.0

JC: I really think that owners at the end of day, they’re very simple people, what they’re really looking for when they’re working with the management company is they just want to know hey look, can you keep me updated on how my properties are doing. And if there’s a problem, can you let me know about it so we can solve it. And if you can do those two things on a consistent basis, I think after a while owners become comfortable with the level of transparency and trust and I think they let you go do your thing. I think what happens is that owners have become frustrated with property management companies that aren’t set up to be transparent. I don’t think it’s an intentional thing as a management company. I don’t think that there’s management companies out there that genuinely want to hide information from owners. I just don’t think that’s true. I think the problem is that they’re not set up structurally from the very beginning to automate the way that they’re sharing the data so that it is a transparent engagement.

And so, I think what really frustrates owners in my opinion, is when they don’t have that data coming to them in a very simple and transparent fashion that lets them know, A, everything’s hitting right or B, we’ve got some major issues and we need to go solve them. And I think that as an owner, if you can really look for management companies that are completely focused on delivering that level of transparency and really focusing on the profitability, and working backwards in terms of how they accomplish it with the simple things like happy staff and amazing customer experience, and making sure that the KPIs are there to tell them how they’re doing, I think that is the key to how you’re going to be profitable in this business.

00:24:36.0

WS: Yeah, no, that’s incredible. And what you just said  — they’re not trying to not be transparent but they just have an automated system. And so it’s almost like manually having to upload those invoices right. It’s just too many tasks like that. So, changing gears a little bit JC, you are working with lots of owners now and you being an owner for many years, so much great experience, I’d love to know just your thoughts around being prepared for a downturn? What you like to see as an owner, or even yourself as an owner, how you prepare for a potential downturn?

00:25:04.0

JC: Well, Whitney it’s a great question and I think the answer to your question is how do you prepare for a downturn, well, The answer is, you have got to understand that one a downturn happens, there is way more competitors trying to get way less business that’s out there from existing residents or customers. So what do I mean by that? Well, what I mean by that, that is, when there is a downturn, what happens is, suddenly, a lot of people that are sort of what I would say you’re not so desirable customers to have, or you’re not so desirable residence, they all kind of get wiped out they, they’re already living paycheck to paycheck. They lose their jobs first because they’re just not as, let’s just face it, they’re not as, you know, hard working people and I don’t want to generalize but this is about making sure that we understand the profits run the business. And so, what happens is there opens up a lot more that opens up a lot more vacancy at the properties. Okay, so if you’ve got 1, 2, 3, 4 or 5 competitors in your local micro market within that, you know, two blocks three blocks or four blocks. Just imagine if there are less clients to compete for and more inventory, what you’re going to do is you are going to be at the mercy of the customer. The customer is going to have the power. 

Well, when the customer has the power they’re going to, with all things being equal, they’re going to choose to live at a better property for a better value than not, right, so what you want to do to prepare for a downturn is you want to actually get in place, and amazing customer experience and get your Google reviews up you know you should have great reviews on your property you should be focusing on that. Because when the downturn hits, everybody has choices. The great residents, the ones that you really want, your property to carry you through the tough times, they’re going to be looking to live at the best property in your micro market. And so if you are not already working hard to get your property position as the best property in your micro market, then you are going to suffer in the downturn. So if you as an owner are thinking about how you’re going to prepare for a downturn, what’s pretty simple. You and your management company need to start working on how you’re going to give the best in class service in your micro market because the people that have the worst in class service and your micro market, those are the ones that are going to suffer in the downturn.

00:27:20.0

WS: Love that advice. What, what’s one tip to getting those good reviews?

00:27:21.0

JC: Well, you got to ask for Whitney. One of the things that I think that people forget is most times, if you don’t ask for reviews, they’re going to be all negative. Because the only time that most people think to leave a review is when they have bad service. That’s not just related to apartments, that’s human nature. If I go to a restaurant, and I have, you know, the worst waiter in the world and I have terrible service and the food’s brought out and it’s cold, I’m probably more likely to blow that company up with a bad review of that restaurant. Then, if I had an amazing experience, and an amazing waiter, and amazing food I’m probably not as likely to submit a five star review but I’m much more likely to submit a one star that’s just human nature Whitney, The differences, if I at that five star restaurant and I’m getting an amazing experience as I’m paying for my meal, and I’m super happy and my smile is big and I got a fat belly and everything is going great, if that waiter just leans over and says, “Hey, I’m going to text message you a link to our Google page, and I, if you loved what you ate and you were so happy, all you gotta do is hit that link, give us a five star review and put a couple comments in there about what you thought.” And if you do that, Whitney, what you do is you hit them at the time when they are feeling great. And you ask them to give you a review because if you don’t ask they won’t do it.

That’s when you’re most likely to get a five star review now, you have to have a process that every time a work order is closed. Okay. Every time I work or is closed, you give a survey, if your national company is set up right, a certain automatic survey should go out and it should say how did we do, and also a text message should go out and it should say here’s our link to Google reviews. Give us a five star. And by the way, if the work order wasn’t done right, you should actually be following up with your residents and asking them how we did with the work order. If it wasn’t done right. You should work, open that work order back up and go fix it. And then when you close it and it’s done right. Go ahead and for the Google review. So, again, Whitney if you want to get your reviews up. It’s really simple. You got to ask for it it’s got to be part of your process of opening and closing work orders, and also part of your movement process because most people are after a great work order or after they move into a brand new upgraded unit, those are the best times to hit him up for a Google review.

00:29:44.0

WS: That’s some great value right there JC appreciate you sharing that with the listeners and myself. What about any predictions that you have just in the real estate market over the next six to 12 months, 18 months?

00:29:53.0

JC: You know my prediction is that it’s going to become increasingly difficult to operate for profit. And so, if you are as an owner if you are not working with management companies that are extremely committed to doing everything they can to maximize profitability, with pricing being an all time highs and even though rents are going up like gangbusters right now I don’t see that really continuing at the pace but I think it’s going to continue to hopefully go up a little bit. But you’re basically what you have right now is you have a pricing at all time highs, and you have expenses going up. And so, there’s so much smoke coming up, and little room for hitting your target.

So, if you are not completely focused on maximizing your profitability, with management partners and people that are committed to doing that and have processes to help you do that, then I think what’s going to happen is,it’s not going to be a game over situation where the, where the ship is going to sink and in 12 months, hopefully, but I think what’s going to do is it’s going to have an extreme impact on disappointed investors and missed performance metrics. So you’re not going to hit your cash on cash distributions. You’re not going to hit your revenue runway. And there’s going to be reasons for that. The reasons are going to be that you know you have sort of lost the ability to really do the basic blocking and tackling and it’s going to make a big difference. 

00:31:07.0

WS: Now I appreciate your elaborating. I wish we could talk more about it. But just a couple more questions quickly, but any daily habits JC that you are disciplined about that have helped you achieve success?

00:31:15.0

JC: Well, I think the one thing, Whitney that I think has helped a lot is, you know, as a leader of any company, what you have to do and I’m very committed to this is you have to constantly be thinking every day about how are you going to make your staff’s lives easier, especially the onsite staff. And I don’t mean easier as in like they don’t like to work I mean easier as in, how are you eliminating all of the back office stuff that they should not be doing or that’s not creating value.

So if you are thinking about ways to make their lives better as employees as people working at your properties, keeping your residents happy and putting that money in your pocket, I think in a lot of ways you’re sort of missing the boat. Because those onsite people, those employees that are working at your properties are really the biggest difference maker between you making money and not. So for me, you know, Whitney I think that every day. And I try to instill this in our executive team: “hey let’s figure out how we make our staff lives better and how we make it more efficient.” Because ultimately, that’s going to put more money in our owners pockets. And if we do that, we’re going to make more money too and everybody’s going to be happy.

00:32:18.0

WS: JC, how do you like to give back.

00:32:19.0

JC: Well, listen, listen Whitney. The way that I like to give back is very, very simple. Okay. There are a whole lot of people out there that are always looking for good advice on property management on multifamily ownership in general. And so, I actually have a podcast of our own as well and we put out podcast episodes and we just basically talked about how to make more money as an owner, how to get over some of the struggles that people are facing. So I think one of the biggest things that I’ve really sort of been trying to focus on is having a, an outlet, where people can tune in and get tips and tricks and learn things about being in this business, and apply it to their to their craft and to their properties into hopefully you know try to make a little bit more money with their properties.

00:33:01.0

WS: JC, it’s always a pleasure to catch up with you. Like I said, I’ve learned a lot from you and I’m grateful to have you on the show, and you have shared so much with us today just around property management and overcoming the struggles of reaching goals as owners and some of the biggest causes, how to fix them. And, just the stress of keeping our own site staff happy and a few great ways that we need to examine our own businesses and how we’re managing them right now. I think anybody listening that owns properties almost of any size you can be thinking about what’s your staff doing right and are they happy and ways that that you can make them more happy right or maybe outsource some of those repetitive tasks. But even having that amazing customer experience so residents, and then also tracking KPIs man, just some great tips, grateful for your time. 

Tell the listeners how they can learn more about you and listen to your podcast also.

00:33:54.0

JC: Yeah, well if anybody is interested in checking out our podcast or checking out our company then they can simply go to operateforprofit.com, that’s operateforprofit.com. That’ll take you right to our company website that’s Velo Residential and we have a podcast out there, very simple. The Operate for Profit Podcast podcast. Again, operateforprofitpodcast.com You can find it anywhere that the podcasts are syndicated.

[END OF INTERVIEW]

[OUTRO]

0:34:21.0 ANNOUNCER: Thank you for listening to the Real Estate Syndication Show, brought to you by Life Bridge Capital. Life Bridge Capital works with investors nationwide to invest in real estate while also donating 50% of its profits to assist parents who are committing to adoption. Life Bridge Capital, making a difference one investor and one child at a time. Connect online at www.LifeBridgeCapital.com for free material and videos to further your success.

[END]

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