Space – The Final Frontier!

The Government has launched a green paper on social housing which has had a mixed reaction but generally left people underwhelmed and feeling it misses the mark. What it has triggered is debate on how to deliver the affordable homes for people which are lacking and getting worse each year.

There is a school of thought that micro flats, co-living and shrinking home size is the answer to delivering the homes needed. This feels short sighted and completely missing the point. There is no way that micro flats and co-living offers anything other than a stop gap in people’s lives. There is a moment in time when you leave college and hit the outside World that someone may be content to have shrunken living space. In the long term? Well the Englishman wants their castle and no castle is going to fit into 25 square metres!

Surely the route to solving the issues is the property industry lowering their profit and financial return expectations to leave a legacy. If homes were built with more floor space then it would offer better quality of life for the owners and the renters. This would lead to a happier population and facilitate downsizing for the older generation and up sizing for the next generation.

I am convinced that property players do not put themselves in the shoes of the person they are building for. I have previously commented about how many property people have lived in or are still living in flats. Well of the new breed of micro flats and co-living, how many of the developers, architects and advisers live in their product? It is very easy to run around in a palatial home opining and delivering homes that you wouldn’t want to live in. Not being the target demographic doesn’t really wash on this.

While there is limited choice and lack of options, I would like to think that the property industry could rise to the challenge and be comfortable with lower value per square metre in order to deliver homes and communities that our children and grandchildren will look proudly upon. Not that another generational mistake has been made!

Tech – the final frontier!

There is a chasm between generations presently like no other. From those of us whose careers span back to sitting at a desk with a telephone and Dictaphone waiting days for replies to written correspondence, to everyone who is wondering what the heck I just said! In a short run of 30 years life has changed immeasurably. Indeed, each passing decade the scale and quantum of change is compounding.

Property has generally been a slow adapter of technology and appreciating its full potential. The first computer shows in property were only held in late ‘80’s and even now you can find management surveyors operating on paper-based systems with little or no technological equipment!

As with any buzz words the property world is now embracing Prop Tech and every other zeitgeist phrase being thrown. My favourite being block chain. If something is too complicated to explain to everyone then there is something wrong! As I see block chain it is an adaptation and evolution of web platform that is not the great panacea but rather the next phase in the evolution of our lives from hierarchical structures to a networked environment.

How is the World of Tech impacting on build to rent? Given that the multifamily sector is in its infancy and trying to walk it is embracing technological solutions more willingly than most other areas. Searching for the holy grail of systems that do it all for you without any effort. Slightly harsh but I exaggerate to make a point.

I have always taken a very simple position with technology. It should be there to help me and it work for me not me work for it! This means I want a solution that meets my need not replicating what I would do on paper or old ways of working. For example, if I truly understand how I want the data out and what I want to measure then it makes it easier to input and make sure a system is going to deliver that. The old adage still holds true however, garbage in, garbage out. Every system is reliant on the data entry and care in handling. I am certain that it is never the computers fault and I am sure that the only time there are issues or work created is from poor training or records.

Another issue is the need in organisations to have systems and processes that meet the need of all. Designed by a committee usually and trying to have democracy is never going to work. We all work differently. Our brains are wired differently on how we use machines and how we would logically deal with something. With the tech solutions we are effectively trying to get everyone to work the same and cookie cut what we do. This theory is fine but recognise the needs of each team member and invest appropriately to aid and deliver quality outputs.

This is a very exciting time; indeed, every period in my career has been, you just have to embrace change! There are some very useful products coming through – being able to recognise the ones that work for you is the key. What is good for one company won’t fit another. Taking the system is only part of the equation. Without discipline and training of the team delivery of the outputs will be impossible and end up taking more time.

No, More Mr Nice Guys, please

I have been doing a lot thinking on community and facilities recently. One of sites I am overseeing in particular. It is in great shape but needs a level of responsibility from its renters that seems to somehow just fall short. For example, there are two flats where the renters insist on hanging hammocks on the balcony. Now this is fine while in use and on the balmy Summer evenings we are having. I can see this as an attractive relaxation for the renter. However, leaving it up when not in use is an eyesore and ruins the appearance and ambience of the community.

One person airing their washing is everyone else’s blight! Leaving bikes on balconies looks dreadful as does dead plants! In short you have to think about others at all times. As a generality this would make our daily lives much better but with your homes it will definitely make it better. A smoker not being allowed to smoke indoors but leaving a pile of cigarette butts to build up “planted” in the boarders and plant pots is positively un appealing for everyone. I guess even the smoker or they would tidy them up!

How do we build a community where the appeal and interests of all are at the front of everyone’s mind? Equally for those selfishly minded how can we get them thinking on community and impact and effect for all? This really is the challenge and in reality, is the essence of customer experience. There is an adage that it is a thankless task to serve the public, because you can never please everyone. Certainly, when you look at the way companies protect their employees and have anti bullying policies in place it shows the necessities and the situations that need thinking about.

Generally, openness in all dealings and transparency has a good effect on mitigating frustrations and confrontational aggression. If you can explain and give reason for an approach or a request it can make it more palatable. Being fair and firm along with consistency of message is vital. IF one person gets away with something then why shouldn’t the next person? Then it is difficult to control and manage a community. They are always people who want to push the boundaries and people who want to take advantage. Mitigating that is the secret. In a successful community everyone will act together to keep in good order, to stop abuses and to clamp down on the non-conformists.

This is especially true on appearance and delivery. If there is no litter, no graffiti and all landscaping is well maintained it can have a dramatic effect. If graffiti is removed the moment it appears it removes the purpose for the miscreants and they go elsewhere. If renters see ALL staff pick up litter they will not drop it, because it instils pride that their homes are cared for and well looked after.

Small things can make a big difference. It just takes time, energy and a desire to want to serve and manage. After all if we don’t do that we should find another profession!

Try a little patience!

Two common themes for me are customer experience and community spirit. These are matters for all aspects of life but are exacerbated when it comes to communal living of any sort. The number of clips on the internet of people overreacting, bullying, arguing, and incident rage are extraordinary. Of course, from any totally objective perspective it is easy to be rational or controlled. However, when caught up in a moment rationality tends to dissapear faster than Boris Johnson for a Heathrow runway vote.

Communal living should not be a flash point and should not give rise to such incidents, but what it does do is offer an opportunity for matters that irritate or frustrate to get compounded and extrapolated into major dramas. This is all understandable and typical human reaction; but at the same totally irrational.

I am sure you will have all had situations where you have been on the receiving end of someone’s ire. It makes you react negatively and it makes you less inclined to help someone. Both of these reactions do nothing to resolve a situation. In fact, it probably engrains it further. If we have experienced the negative feeling why then do we all persist on speaking badly to people, reacting angrily or throwing our toys out? Surely, we would be better all the time to engage and seek resolution.

I have a number of cases on where conciliation and engagement would resolve matters far easier and cheaper than the confrontation and aggression that is being experienced. Although there are times where motives can have a big impact on the persons stance however illogical it looks. Motive brings a whole other dynamic in to play. But when we are talking about people’s homes then there should be little room for the shenanigans and game playing that is frequently seen. Most of the cases I have on are acting for the leaseholders and quite a few will quite naturally want to pay the absolute minimum in service charge even though what is being sought is reasonable and fair.

To see how much game playing can be done in business you only have to pay attention to Donald Trump for a couple of days. A man not known for moderation or conciliation; he is always taking an extreme position in the hope and expectation that what he achieves will meet the needs of that situation. The tariff issue is a perfect example. He has polarised himself to resolve what he perceives as inequity. Of course, we just haven’t seen this approach in politics and on a World stage before so the consequences and impact longer term will be the interesting part.

Where you have a building owner or a leaseholder who wants to extract an unfair advantage it will end up in Court or Tribunal. Both costly and not to anyone’s advantage really. If you can discuss and negotiate then you will be better served. It is not about winners and losers; it is not about right and wrong; it is about fairness and harmony. So as Take That would say, try a little patience!

California Dreamin’

I am writing this as I am flying back from the wonderful City of San Diego, home for this year to Apartmentalize – the National Apartment Association (NAA) annual education conference. A chance to rekindle friendships with 10,000 of my American friends and embrace the positivity and experience that is multifamily USA.

Yes, that is not a misprint there are 10,000 people at the conference. They took over 28 hotels, the closed the Gas Lamp district for their Thursday night party, and I mean closed. The streets, the bars, the shops; all closed from 4am on Thursday to set up until 6am Friday when it was all packed away. There were bands, food, drinks, entertainment and a spirit of joy and welcome that was a delight to experience.

The major factor in USA multifamily at present is affordable housing and there are national changes that are causing real problems. The NAA have led with fellow associations to try to assist and ensure the most vulnerable are housed and looked after. The speakers included Mike Rowe who has a show called Dirty Jobs which is exactly what it sounds like and also Alex Rodriguez (A-Rod) legendary hero of New York Yankees and now has a multifamily corporation and 15,000 unit portfolio.

Stand out speaker for me though was Shabnam Mogharabi of Soulpancake. AMAZING! All they espouse is joy and positivity. Not a dirty word and certainly preferable to negativity and miserable. It was founded by Rainn Wilson (you may know him from the American version of The Office) and if you haven’t come across Soulpancake I would highly recommend you check it out.

The exposition had the usual cars to give away and all manner of competitions from the suppliers. With over 600 suppliers exhibiting it is like entering Ideal Home Show and certainly the step counters tick over at a good lick as the carpet is worn down over the 2 day run. The suppliers dollars make the event possible and their generosity is amazing to see. They have their own parties from hiring the USS Midway through to the Baseball stadium and a concert from Kelly Clarkson! No venue was spared in the town and the number of bands flown in (some a lot better than others!) is to be seen.

Having founded the UKAA and proud for it to be the first overseas affiliate to the NAA; on behalf of the NAA I am now looking to an International Apartment Association and planning the delivery to launch into our neighbouring European countries. This gives an exciting dimension as the globalisation of organisations and capital moves from Country to Country and Continent to Continent. The housing demands and the trend to rental is a wave spreading Country to Country. Of course, mainland Europe has long seen the benefits of renting their homes and not tying up capital and the burden of mortgages.

As I head into Heathrow I am excited and energised by the positivity of the last week and the service and experiences America offers. Now to translate the trends and perspectives to the UK and Ireland markets.

Sealed with a kiss!

I sometimes think that no one who works in flat management lives in a flat. This has to be true or otherwise they must switch off their home life experiences when they get to work! I say this from recent personal experience and also from the very long career in property management. In this article I am specifically referring to the inability for managing agents, and those involved in block management to deal swiftly and effectively with correspondence.

My recent experience is a legal matter relating to the title of my home. My lawyer was waiting for the freeholder’s manager to reply to enquiries and provide costs for notices. I only foreshortened what had already been a long delay because I am involved in the business and could go to the top of the manager to elicit replies. For the majority it is really frustrating and increases costs and delays.

Let us look at the situation when you are buying and consequently living in your leasehold home. There is an infrequent need when you will want information, answers or formalities dealt with. These could be replies to enquiries, questions on the service charge, notices to be acknowledged or a whole manner of other interventions. To you it will be important and essential, to the manager it will be one of a large amount of correspondence they receive. The simple fact is that the management of residential property is a thankless task that is under rewarded and can quickly become demotivating. Looking at each of these aspects you may get a better perspective.

A thankless task? Well in reality the only time the managers hear from the leaseholders is when there is a problem, they need something or in response to invoices raised. A number of the leaseholders will not be the most courteous in their communication. This all leads to a presumption that any email, call or letter will be abusive and a reluctance to pen them let alone deal with them. When I had my management company Chainbow a lot of time was spent to train our team to put themselves in the leaseholder’s shoes, as well as to be open and transparent. This perspective can reframe situations and allow a more open dialogue rather than confrontational or challenging.

Under rewarded? Typically, the managing agents fee will be around £300 for each flat each year. This is to cover not only the manager but also the accounts staff and the liability and risks on health and safety. That is not a lot in reality and depending on the number of flats in a building the total fee for the block may not be an awful lot. Consequently, the managing agents need to give their teams a large number of buildings to look after to make it profitable. The challenge therefore is to get first class service for a low fee. The one thing for sure with technological advances and algorithms is that there will be a major disruptor through technology to improve management services at the costs required. But that will be a later delivery, in the meanwhile the managers will need to improve their service skills. The large majority of the service charge you will pay is for maintenance and services which do not go to the managing agents – a common misunderstanding by even the most experienced leaseholders.

Demotivating? Well after years of abuse, disrespectful communication and contention from leaseholders it can have a demotivating effect. It is like a constant tapping, it becomes quickly irritating and frustrating.

None of this explanation is to make excuses for poor service, delays in replies, delay in service charge accounts or other poor handling. It is intended to give you the perspective of what goes on with managing agents for common parts and for the ground rent investor.

I would therefore always advise the leaseholder to think about how they communicate in terms of tone and timing. For instance, it is no god saying every request is urgent, it merely devalues those that genuinely are. You may have had a dreadful day and an issue with your home may be the final straw but taking it out on the manager is never going to get the best reaction. Think about how you react to awkward and challenging communication.

You don’t need to seal your letters with a kiss but an email written with a smile and engaging can make it all the more appreciated and swifter to get an answer!

Pets – friend or foe?

We are a nation of animal lovers; although when it comes to investors and landlords you would think we were the only animals allowed on the planet! The challenges that allowing pets into blocks of flats brings is enormous. The enormity I will return to in a minute. Before that let us reflect on the investors, landlords and operators who lay down the laws on who can and can’t come in. I am sure given the truism of animals, the nation and love that these same investors, landlords and operators would not be without their four-legged friends but opine on the rental community as to who can enjoy and embrace creature comforting.

From my international experience in USA and Ireland there is an ability to get a medical certificate to confirm you need your pet for emotional support and armed with said certificate you must be allowed to habit with your beast of choice. Now I say beast advisedly because friends in the USA are finding snakes, alligators and totally inappropriate dogs are being labelled as an absolute necessity for the person to continue to live! Indeed, in the USA unscrupulous Doctors (or those who just fancy a quick buck!) will provide a certificate at your wish!

I am sure it is one short bunny hop across the Irish sea for us to be under the constraint and controls. Therefore would it not be sensible for the rental community to embrace pets and plan how to monetise and operate efficiently rather than ban and bar anything other than humans. This is also another huge marketing opportunity for the multifamily market which in having control of a whole building can make sure pet friendly buildings don’t alienate those who would rather not be around them or may have allergies. In the general letting community of the buy to let investors not having control of the whole block and your lease most likely having a ban on the feathered and furry critters would make your embracing of a wider community incredibly difficult.

It is sensible to have floors allocated for pets and floors that are human’s only. This will then allow the differentiation of those whose sensitivities and nervous dispositions would be challenged to live in harmony and peace. Of course, you need to be sure that nocturnal barking wouldn’t create a cacophony to challenge Disney’s The Aristocats at their freestyle jazz finest! Mind you sound proofing of the apartments should be a basic in the first place.

Sensible planning of what animals you would wish to stay outside of the building and those you’ll embrace should see you have a clear line with potential renters and avoid the murky grey area when it comes to how to say no nicely. If we get emotional pets then that will mean planning in a different way.

Seeking pet deposits to cover the unwanted pet deposits (if you get what I mean) can mitigate the impact of damage and devastation to the apartment and the building. Embracing a pet rent will increase operating income. You only have to look at the ongoing success of Pet World and the toys and clothes pets find thrust on them to realise the lengths their owners will go to in making their life revolve around them.

Whether you want to stay pet free or turn your building into a static Ark of which Noah would tip his hat to, either way that is the owners choice. However, as an income source you can’t look a gift horse in the mouth!

Animal Farm

One of the set books for my English O level (exams for 16-year olds a long time ago!) was Animal Farm by George Orwell. If you haven’t read it I would thoroughly recommend it. It is apparently a thinly guised allegory for the Russian revolution, however it also serves as a metaphor for a whole host of other situations and arenas.

A short and a very crude summary would be the farm in the book is run by a bad greedy farmer who abuses the animals and the animals revolt and the pigs become the leaders and eventually turn into bad greedy leaders who abuse the animals!

Wasn’t it ever thus? Power corrupts! Well in most cases it certainly leads that way and we can point to a whole library of examples. There have been forests felled in the reporting of how bad freeholders are and all the scams and poor service they are prone to dish out. I have said many, many times there are good and bad on both sides; some freeholders are bad and indeed not all leaseholders are good.

I have a fascinating advisory project on the go which the story quite frankly beggars’ belief. The now head leaseholder started life as a leaseholder but engineered a dispute with the owner. He challenged and harried and caused so much grief in the Courts that the previous Head Leaseholder was forced into liquidation and in settlement of its dues to the leaseholder the liquidator handed over the head leasehold. Now instead of being grateful and engaged with leaseholders he has taken advantage of his neighbours. He denies beneficial interest, he has added personal bills to the service charge; the list goes on and on.

So the leaseholders are left seeking redress through the First tier Tribunal and the Courts. So far successfully but there is always the threat of action for deformation or reneging on agreed offers and terms. The whole litigation process can be very wearing on those who are by nice conciliatory and nice people. How this turns out we will have to wait and see but in the meantime the leaseholders are put to expense and stress and strain they quite frankly should not have to.

There has to be a better way and there has to be fairness for all. As I repeatedly say it is not all bad on one side and all good on the other. Ideally, we would get all on the same side and for all to realise the benefits of acting fairly and with each other. Mind you that is a utopian World that will never exist unless we clone everybody and please don’t let that be the future!

In the meantime lawyers and advisors will make money from others misery. Not fair but someone has to stand up for the good guys whatever side they are on.

Alexa – Are you listening when you are off?

This is one of those questions that will plague us going forward. In much simpler times all we worried about was whether the fridge light went out when you closed the door or did a tree make a noise if it toppled in a wood and no one was there. Well with the speed of change in technology we are building a platform of a whole new complexity of worry and question.

At a recent UKAA round table on technology there was a healthy debate about the future, making technology integral into all business planning and how communities will need and use amenities and services going forward. As an aside if you haven’t ventured to one of the UKAA round tables, you should. The debates and discussions are fascinating and always educational. Check out the UKAA website and contact the team to get involved.

Anyway, back to the matter in hand! There will come a realisation that technology is there for our benefit and in the truism that we are all different we will all embrace technology differently. For some they want to have the illusion their life is easier in controlling lights and heating away from the home, that they can voice command the TV. Personally I am happy exercising the legs, using the remote and waiting till I am home to flip a switch! Primarily I do not trust the large tech voice elements and giving over all my life to them. We sat in a round table a while ago and someone’s phone sprang into life from someone else’s voice and started searching the wonderful wicked web – not only was it not the right voice that activated it, it was switched off!!!!!! And they say they are not listening all the time!

Already we see the value of data and this will only increase going forward. The companies who control the data will be where the value is. It is no coincidence that Amazon are looking seriously at property management and how to enter the market place. Their parcel lockers are only a toe in the water. They will be taking a headlong dive and immersing themselves before long. Followed by the other likely candidates there could be a seed change in the market place. Will our managers adapt to challenge and change or be frozen to the spot like dinosaurs watching the landscape change?

It is an exciting time and advising on future proofing is a fascinating and challenging occupation. One I embrace and relish. The start point is knowing how you use technology, accepting how others use technology and providing the opportunity and facility to embrace all.

So as I head to my golf club writing my fortnightly thoughts and musings to be submitted on the go spare a thought that in my career I have gone from no computers to the early doors of internet of things. The speed of change is lightning fast – embrace it and bring it in front and centre. It is not a something else, it is not an afterthought, it informs your business, it shapes what you do.

Make the tech work for you and your business not you working for the technology.

THE EMPRORERS NEW CLOTHES

If a lion’s mouth is open then it seems only reasonable to put your head inside and see what happens! What on earth is he talking about with this one? Well the wonderful world of multifamily is growing and new entrants are appearing each week. New experts pontificate in the arena and thought leaders pronounce guru like on the complexities and the nuances of capturing the essence of multifamily. Do we slavishly follow the American model? How do we force community? How do we monetise our amenities? The list goes on. All the while renters rent and live in their homes.

And that last sentence is the quay, the rub, the code! The renters live in their homes. What we are dealing with in multifamily is not a brave new world; is not some paradigm shift, but it is giving renters the best possible experience for their lives in their homes. So, everything you do and everything you create should keep front and centre how do we make the renters experience better?

It is entirely possible that you can’t make the experience better, in which case stop wasting money and pretending there is a Holy Grail and just get on with renting out the flats. If you want to build community, this has to come from the bottom up. You can facilitate, suggest, influence but you cannot force renters to join in or engage. It is impossible to say “tomorrow we will have a community and everyone will have fun and join in our new fun run route around the park!” Seriously? Would you sign up to that?

You can achieve engagement but it is organic and it is slowly, slowly in approach. How many people have you ever forced to be your friend?

It is time we stripped back to basics and built up our models slowly and surely with care and caution. At the end of the day we are renting homes. Focus on that and build from there. In style and presentation, take pride, have the staff clean tidy and presentable; keep the building clean and tidy; be the catalyst for community not the Fuhrer of fun! This is about doing the right things and doing them well.

How many of you live in a flat or have gone and stayed in your flats you are renting out for an extended spell of a month or more? Only by doing that do you see the challenges or the problems. Throughout my career I have been staggered how many people in property do not enjoy or experience the products they are producing and managing. I never ceased to be amazed that shopping centres abound with people who don’t love shopping! If you design or manage flats and live in a house how can you really know the issues or the opportunities?

I would advocate getting yourself into community spirit and experience your products first hand. Then let’s have debate on what needs changing, what can be improved and how we build community. I bet you will be surprised what you find.