Peter Lohmann's Podcast
00:48:36 · Peter Lohmann, Dan French
[00:48:36] S0: I just [00:48:37] S1: can't do [00:48:37] S0: it. Multi family is easy. It's the same as single family. We've been doing it since day one. [00:48:43] S1: Well, in her experience, you know, this is what I tell some of my team though, Peter, like, you're Peter, bro. You know? Like, what's what's easy for you? [00:48:51] S0: No. But this is even back when I didn't know anything about anything we were doing it. I mean, a a fourplex. [00:48:56] S1: Some people figure it out and some people don't. [00:48:58] S0: You know? I mean, a fourplex is the same thing as a single family. There's... It's no different. It's... You'd... [00:49:04] S1: No. That that play is sane, but she's talking about 50 unit deals [00:49:07] S0: and infill Yeah. We've actually struggled with those. We have struggled to retain those. We... We've had a real issue of churning out those owners. That's what happened That's what you're talking about. So that makes sense then. Please tell me the secrets because we we have not mastered that yet. [00:49:21] S1: Well, and just just watch the Northpoint journey because you'll you'll see all of them unfold in real time. We're gonna kill it in that space. We're gonna absolutely... We're gonna have 10,000 doors in that space alone very, very quickly, very quickly, and 10,000 in BTR. Yeah. How do you think
00:49:21 · Dan French, Peter Lohmann
[00:49:21] S1: Well, and just just watch the Northpoint journey because you'll you'll see all of them unfold in real time. We're gonna kill it in that space. We're gonna absolutely... We're gonna have 10,000 doors in that space alone very, very quickly, very quickly, and 10,000 in BTR. Yeah. How do you think [00:49:35] S0: owner of a 50 unit door property, would you say they're more closely aligned with an institutional owner in terms of show me the reports and the data, or would you say they're more closely aligned with the mom and pop, like, hey. That was, like, my grandmother's chair rail, and now it's ruined, and I have memories of that, and how could you let this happen to [00:49:52] S1: be Yeah. Much more closely in line with the institutional owner Okay. Expectation. This is almost certainly they have capital that they're reporting to. So... And now look, I've I've I've invested. I... I've been a g... A sponsor, and I've I've raised capital. I've done the whole stack. You know? I've done large scale multifamily deals. I've done hotel deals. Done 300 unit deals, 400 unit deals. So I I know how the... I know that owner, and I I believe, and I know enough of those small owners to to know how they think as well.
00:49:52 · Dan French, Peter Lohmann
[00:49:52] S1: be Yeah. Much more closely in line with the institutional owner Okay. Expectation. This is almost certainly they have capital that they're reporting to. So... And now look, I've I've I've invested. I... I've been a g... A sponsor, and I've I've raised capital. I've done the whole stack. You know? I've done large scale multifamily deals. I've done hotel deals. Done 300 unit deals, 400 unit deals. So I I know how the... I know that owner, and I I believe, and I know enough of those small owners to to know how they think as well. [00:50:25] S0: Got it. Okay. Last thought on the melting iceberg problem is that you... When you acquire... When you do a deal to buy a property management company, you... I I think, like, you have to buy the machine that produces the units. You can't... If you just buy the doors, then your your iceberg is gonna melt away. You wanna buy you wanna buy a machine that knows how to backfill the doors that it loses every year, which to me looks more like a stock purchase of a branded, well established management company with leadership in place. Like, that is a machine that knows how to backfill doors that it's losing every year. If you just buy 200 doors off of some brokerage guy, those doors are gonna melt in your fingertips. You know what I mean? Right. [00:51:21] S1: Right. Totally right. The last thing I'll say about, you know, churn is I was talking to this guy, Moses Kagan. Do you... Don't know [00:51:28] S0: if you [00:51:29] S1: heard that name. [00:51:30] S0: He's he's been a huge influence on my, you know, journey.
00:51:34 · Dan French
[00:51:34] S1: Yeah. I I thought so. I... Yeah. And, anyway, I was talking to him, and he really made it hit home big time. He's like, you know, he wasn't calling it this, but he he was really talking about a trust layer. So developing that trust layer between this platform you have and and the owners, if you can kind of occupy that space and build trust with your owners, then then look, it's property management, things go wrong. The roof is gonna, you know, leak, or days on market are gonna be more than you want because of some supply demand thing, but maybe you need to, you you know, you can't just have a knee jerk reaction of like, alright, I'm just gonna fire you. So if you have this trust layer where people look and they see a, you know, a living, breathing human person that represents a team that that is out there grinding it out for you every single day. They're gonna give you grace. And this is... I was telling my team this over the weekend, I wrote a a big long memo to them, but but basically one of the ideas I had was like, it's... When he told me that, it reminded me of doctors and malpractice. So very famous experiment or study in 1997, Malcolm Gladwell wrote about this back in his book called Blink. But it's a fascinating study. People with good bedside manner are doctors, and all they have to do is spend three extra minutes, you know, use inclusive language like we versus just like you. We are gonna do this, or here's what we're gonna do, or look at. They they use humor and empathy. They have a bunch of the different categories of stuff they do well. Right? Mostly it's just being human. Being human is showing up well and caring. But those people, those doctors get sued less. They accept far less, far fewer malpractice suits. And I think the same thing is gonna happen with churn. The people who can build a trust layer to their owners and let them know, like, we're grinding it out every single day for you. We're going to go to extraordinary lengths to preserve your property, care care for the residents and keep them safe. Be ultra compliant, and be as aligned economically as possible with your financial outcomes, those factors are gonna make the the melting iceberg go from 20 to 10, and then someone's gonna kill it.
00:53:45 · Peter Lohmann
[00:53:45] S0: I've been thinking a lot about this recently as well, and we're exploring a few a few a few components of this with the new PM trends report. My thesis these days, and I've swung... I've actually swung back and forth on this a couple times over the last twelve years, but my current thinking is that your clients want to call their property manager. They do not wanna call their property management company. Mhmm. And it's very subtle distinction between those two ideas, but it's extremely powerful. People wanna deal with people. They wanna know that somebody at this company... And they don't even really care what company they work at. They just wanna know that somebody at this company is looking out for them and their property. And when they call that person, they call them back, and they know what's happening. They know about the turn. They know about the eviction. They know about the rent collection. If that's true, like you said, a lot of grace is extended. I'll give you a specific example from the other side of the coin. We bank with Chase because Enterprise isn't operated in our state. We love Enterprise. We wish we could bank with them. But we bank with Chase, and we've been with them for forever. Huge company. Right? Of course. We... I have a I have a business banker there that has made an effort to get to know me, met him several times. Great guy. His name is AJ. And whenever I have a question now, I I get to just go to AJ, and he helps you. That... That's obviously a great thing. But I was thinking the other day about, like, when I call AJ, and I have his cell phone number, when I call him, he's like the equivalent of my property manager. Right? He works at a large company, but he's the one that helps helps me access the the large resources of this multinational, multi trillion dollar company or whatever it is. And I I like this guy, and I want him to be successful in his career. And he's been really helpful to me. And when I call him on his cell phone, if he doesn't answer, I don't sweat it because I know he's gonna call me back in an hour or two. Right? Now if I were to call Chase Bank and they didn't answer, I would be furious. I'd be like, this company doesn't care. They never answer the phone. Right? And you're already seeing the the parallels with your property management company.
00:55:52 · Peter Lohmann
When we when when we look at the PM trends report, we see that property owners have very high expectations of their property management company in terms of the phone and email response times and things like that. And my my thesis is that if you assign all of your customers a specific property manager and you give them their number, you're gonna get way more grace on everything from phone response times to turn costs to problems with rent collection. Because just like you said, the owner gets this relationship, and they're like, this person is working for me. They're trying to make me successful. They're doing their best. Right? They're calling me back nights, weekends occasionally. Like, I know a little bit about them. They don't care at all about my company. My owners do not care about RL Property Management. They don't care about my journey. They don't care about my background. They don't care about our story. They don't care about our values. They do not care about any of that. They just don't. And they don't care about how great our systems are and all the things that we're doing and all of our insurance to protect them. None of that. But if somebody named Sally is their property manager and they know that Sally was at their property the other weekend and noticed that the window was a little sticky and they took care of it for me, Suddenly, everything's right in the world. This company is amazing. Sally's the best. Oh, no problem, Sally. Call me back tomorrow. No rush. Right? So there... I don't know how to exactly boil what I just said down into, like, the direction of the industry or what you guys are doing, but it's something I'm starting to really form a strong opinion about.