Property Management Success
00:19:59 · Casey Howe
[00:19:59] S2: Tony, I would go, I think you're absolutely right. I'd go one step further. I do tell our clients, like if I'm on a sales call that they're our ideal customer profile. And and the re I don't say those words, but I say, I say, you know, this is very much a two-way conversation. I'm just ad-loving, but you know, this is a two-way conversation. You know, it's it's great to speak with an investor who is you know investment-minded, they're willing to invest in their property, they value, they understand that keeping tenants happy is is good for you too, and those two things aren't mutually exclusive. It's refreshing to speak with you. This is a two-way interview. I I can tell you, we would very much enjoy working with you, and I I think we do a great job for you. That resonates with them. They like that. You know what I mean? It's yeah.
00:20:40 · Tony Cline
[00:20:40] S0: Yeah, I love it. Okay, so so we focus on our our target client profile. We figure out who that is, we start communicating that internally and externally, and then you you leverage that. You went from zero doors to 200 doors to now you're you were up over a thousand or around a thousand, now you're back a little bit, but you're more focused on 750 now, but more profitable than we were. Yeah. I think this is one of the challenges that I when I'm working with clients. Uh well, you mentioned something earlier about the the hundred door and a thousand door. And I want to just comment on this. I get to see inside a lot of different businesses, and we get to look at the financials and see where the profit's coming from. And there absolutely are companies out there that are operating at a hundred doors that are more profitable than companies that are operating at a thousand doors. And it comes down to your staffing, your pricing model, the type of investors you're bringing on. And I know accidental landlords get kind of a bad rap because they don't know what they're doing. They're making a lot of decisions emotionally. And I'm not saying that there's one client base that's better than another. It's find what works for you that you enjoy working with. But oftentimes people will say, I want to chase the investors. I want to go after the people that have the 30 to 50 units or 200. Units or whatever it is, but your profit per door goes way down in general when you're bringing on, if you go after an apartment building, if you have, let's just say we're bringing on 10 units, if we brought on 10 single family homes, the rent is typically higher, and you're typically able to get a higher percentage or higher management fee. And if you go after a multifamily unit or building, typically you're gonna have lower rents and they've negotiated a lower management fee. So I'm not saying that one is right or the other, but they are different and we have to look at it differently to see where that profit's gonna come from. We have to build our income and revenue streams differently for each one of those models in order to not maximize the profit. I'm not, I'm not a person that says we need to squeeze a nickel out of somebody just because we can, but I am a true believer in we need to maximize the value we deliver and then be appropriately compensated for that value.
00:23:00 · Tony Cline
Yeah, sorry.
00:23:01 · Casey Howe
[00:23:01] S2: No, I couldn't, I couldn't agree more with you. You know, I I think we I have naturally our company has naturally gravitated towards the investor, not institutional stuff, but an investor. Uh and I think that's it's based on two things. One is just sort of the market that I'm in. There's a lot of the they call them triple deckers. They're like six unit, the three-floor six unit buildings. And there um there's a lot of those. And so it's it's there's a market for there, there's a there's a gap in the market of, you know, there are companies out there that are national that will that will manage 300 unit buildings in Boston. And there are companies out there that and and agents out there that will manage like single family homes and duplexes. But like, in my estimation, when we started, there wasn't a lot of great companies out there that were managing like 20-unit portfolios or six unit buildings and things like that. So part of it's just we naturally fell there because that's what the leads we were getting. But what I've you know learned over time is I think where we add a lot of value is uh like we love having conversations with a 20 to 50 unit owner about like looking at their PL and talking with them about how we can improve their net operating income. Like that's the level of conversation that I like to have. And there's not as much competition, I don't think, to in other companies that are having that conversation and um and clients like it, and we can make them very happy by doing that. And so you're right, I think on a per door um profitability uh it it's gonna be well, I should say per door revenue is gonna be lower. I don't know, you know, our per door profitability isn't necessarily lower because where you might see lower percentages and things like that, there's also, you know, it's easier to manage one owner with 20 units than 20 owners with one unit. And so on the client success side of the house, I think our costs are lower. But yeah, our you know, our profit is pro obviously there's that other piece, which is lower percentages and lower rents and things like that.
00:25:04 · Tony Cline, Casey Howe
[00:25:04] S0: And that's why I think after you identify that target client profile, then you go through the income and revenue streams and figure out where where can you maximize your your income for that type of client, but also where can you reduce your expenses? And it all ties together. And so it's it's the whole picture. [00:25:23] S2: Yeah, it is. And the other, but the other nice thing operationally about let's call it a 50 unit building. And by the way, most of our stuff is these six-unit buildings. But yeah, you know, let's let's you know, operationally with a 50-unit building, it takes a long time to go to 50 different single-family homes and do an inspection, right? It doesn't take a lot of time to go out there for an afternoon and knock out 20 inspections out of, you know, so so there are some there are some operational efficiencies that come with uh multifamily too that do not exist with single family, which and so we lean into those where we can.
00:25:23 · Casey Howe, Tony Cline
[00:25:23] S2: Yeah, it is. And the other, but the other nice thing operationally about let's call it a 50 unit building. And by the way, most of our stuff is these six-unit buildings. But yeah, you know, let's let's you know, operationally with a 50-unit building, it takes a long time to go to 50 different single-family homes and do an inspection, right? It doesn't take a lot of time to go out there for an afternoon and knock out 20 inspections out of, you know, so so there are some there are some operational efficiencies that come with uh multifamily too that do not exist with single family, which and so we lean into those where we can. [00:26:02] S0: On the podcast, I talk a lot about the fact that I'm in the entrepreneur extraction business. So my job is to help extract the business owner from the business they built that now owns them, and they've created a business that competes with the lifestyle that they want to live as opposed to supporting it. And how do we get that back into alignment? And as you've grown, what have you done to take yourself off the front lines to be able to run the team? How are you running your team? Are you guys focused on KPIs? Are you running by uh an EOS or EOS-ish type framework? Just how are you able to manage the team where you started with you being the one person to now you have a team of people that are delivering the value and holding upholding your standards that you've set?