AIM 2024: Having It All by Keeping It Simple: Case Studies of Simplified Amenity Programs

Having It All by Keeping It Simple: Case Studies of Simplified Amenity Programs

Apartment companies seek creative ways to drive revenue.

In this tough rent growth environment, apartment operators are looking for new ways to drive more revenue.

Roman Speron, Chief Development Officer, Sentral; Jaja Jackson, SVP, Real Assets, ICONIQ; and Noah Himmel, Chief Operating Officer, Raven Capital Management; discussed ways to find new revenue.

For example, at a downtown Los Angeles property, Noah Himmel, Chief Operating Officer, Raven Capital Management, turned what was a regular happy hour into a language learning event.

He offered Spanish food, Spanish culture, and Spanish wine and taught residents how to speak Spanish.

“This is a good kind of event given the population makeup in our market,” he said.

The event was a hit, running for six months.

Don’t try to do every kind of event. Pick one or two events that you can do really well and do them really well.

Generate leads outside of Internet Listing Services (ILSs), he said.

“Our prospects come from referrals based on our events by coming to our events they get the full experience of the community,” Himmel said. “We collect emails from them, and we follow up. You have to be persistent.

He said operators must always be thinking, “What can I offer my renters, so they don’t have to leave the community and spend money somewhere else? If you offer them activities and food such as at restaurants, they’ll think to themselves, ‘Wow. My community is saving me money.”

Jackson’s portfolio is leaning more toward short-term rentals, for which he said he gets 20% to 70% of a premium by charging daily rental rates at is properties that are managed by Sentral.

“If you’re going to make more revenue in a slow environment, you have to change the game somehow through differentiation,” Jackson said. “We don’t comp ourselves to our competitors.”

By offering short-term rentals, Jackson said he’s creating new demand and new rentals at his properties in South Florida, Nashville, and Chicago.

“You have to expand the circumference for the demand of your building,” said Jackson, who five years ago worked at Airbnb. “You have to bring in renters from other industries, other areas, make your homes available to people who are visiting such as attending industry conferences.”

More Interesting Points

The short-term length of stay varies by market – such as a 30-day minimum in some areas and by-the-day rates in others.

“At some point, you hit the top of the market in the rent that you can charge,” Jackson said. “Prospects will do the tour and look at the lease, but they won’t sign.”

Jackson said, “You need to focus on renewals – keeping them in your community – by listening to what renters are saying. If they’ve told you that their packages are lost, or their trash pickup is bad, and the garage door doesn’t work, fix that low-hanging fruit right away or they’re going to go to the competition.

When renters are paying prime rents, they want to be able to have their friends over for dinner parties. “Expand the common kitchen areas and create that opportunity for them,” he said.