SHERMAN OAKS, Calif.- When it comes to choosing a property management company, the size of a company often becomes a sticking point for many property owners. It’s not hard to understand the many advantages a national property manager can offer to an owner, such as vast resources and economies of scale at a national level. In the past year, however, there’s been a trend of many property owners turning to the regional managers, in some cases at a higher fee, to improve their bottom line. So, what is it that prompts the property owners to leave their national operators and go local? We’ve spoken with a few of these property owners and it turns out bigger isn’t always better when it comes to operating real estate.
“Property management companies are only as good as the people that make up the team of employees”
Location, location, location!
Property owners often turn to regional property managers for the extensive knowledge of the area. In most cases, the regional companies have the staff, including key decision makers, live and work in the areas where the properties are located. It is not uncommon for a CEO of a regional company to personally stop by the properties they manage and shop the competition. This type of a hands-on approach allows regional operators to make better informed decisions to improve operations, and to adopt to any sub-market changes quickly.
To reduce liability and risk, a property manager must be current and well-versed not only in Federal Fair Housing laws, but also in the local ordinances and regulations. Regional operators are typically very familiar with all the nuances of the local laws, and are often the first to hear and act on any changes that occur in their localities. This enables regional operators to ensure protection of the managed assets while reducing liability and risk for property owners.
A more concentrated regional footprint of a local company can offer better economies of scale when compared to a dispersed footprint of a national company. The local plumber doesn’t care about how many buildings their customer has in other states. Having more properties located near each other gives regional operators greater leverage to negotiate with property vendors. This leverage leads to better service and greater savings for property owners.
Flexibility and Agility.
There is no one-size-fits-all when it comes to property management. Every asset and every owner requires individual attention and strategy, and tailoring to each need can be a challenge for any operator. A national operator may have a steady hand on the pulse of their portfolio at a macro level, but can miss the mark by not adjusting to the unique needs of a property. This is often the case when a national company takes on smaller size properties, and tries to fit them into their national model. National operators usually look for cost-saving models based on streamlined process and limited flexibility, often unwilling to take on properties smaller than 100 units or an owner with a single asset. On the other hand, most regional companies will gladly take on smaller buildings as their models typically allow for more flexibility and agility, which in turn better aligns with the owner’s vision and goals.
It doesn’t matter how big or technologically advanced the property management company is, if it lacks human connection it is destined to eventually lose customers. So, while national operators become increasingly reliant on automation and tech-heavy reporting, regional operators continue focusing on personal interactions and building relationships.
To understand the importance of human connection in property management, we spoke with Chris Gray, President at Moss & Company Property Management. “Property management companies are only as good as the people that make up the team of employees,” says Mr. Gray. “Good team members want progress and growth in their careers. With 14,000 units in Los Angeles, we are able to offer our employees more opportunities for advancement without having to pack their bags and move their families across the state lines. Our concentrated footprint allows us to build a tight knit culture resulting in employment tenure of 20-30 years. Our clients love the consistency, and our employees love the growth. This along with our local purchasing power, due to size, provides our clients with better results and therefore greater returns.”
About Moss & Company
Moss & Company boasts its reputation of being the regional expert, operating nearly 14,000 residential units and approximately 2 million square feet of commercial space in the Greater Los Angeles area. Founded in 1960 with headquarters in Sherman Oaks, Moss & Company is Southern California’s premier property management firm.