Post written by
Founder and Chief Executive Officer of privately-held real estate investment firm Castle Lanterra Properties.
By their very nature, real estate investment firms are focused on the challenge of generating strong returns on behalf of investors. But those that specialize in multifamily have a dual-pronged mandate. Residential properties are a cornerstone of people’s daily lives, and in today’s competitive market environment, multifamily property owners must provide amenities and social infrastructure that transcend the proverbial four walls of their buildings in order to facilitate a sustainable, income-producing apartment community.
Identifying new acquisition opportunities and servicing existing stakeholders remain priorities for most investment firms, but it is equally paramount to create innovative and compelling opportunities for residents to come together, socialize and engage with fellow residents, thereby building strong ties with the community at large and the property itself. Though the payoff and ROI may at first appear minimal, a deliberate and purposeful investment into the well-being of residents will ultimately benefit the investor just as much as it will the residents themselves.
Striking A Good Balance
A one-size-fits all approach will not work when an investment manager is creating a community amenities program. Striking a healthy balance to ensure that the social programming offered at a property fits that particular community can be challenging due to the fact that every property is inherently different. Some properties may be occupied primarily by single millennials or empty nesters, while families with young children may reside in others. Therefore, it is critical that the enhancements and amenities offered at each property are strategically tailored to the demographics of the individual property. In addition to demographics, property owners and investment managers must also take into account the size, design and infrastructure of the buildings to strike the perfect note.
To ensure that the events and amenities best fit residents’ interests and needs, property owners and investment managers should consider hosting a town hall meeting after the acquisition of a property — but prior to investing in social infrastructure. Introduce yourself to the residents, and allow them to talk about any existing issues they have. Then, at the same meeting, broach the topic of social events to engage the community, and take note of what interests them most.
Understanding the value and potential of the property itself is essential to creating one-of-a-kind amenities — some properties have unique characteristics that lend themselves to specific events. For example, based on the property design and community resident mix at one of our Texas properties , we took the opportunity to host a vintage car show on the rooftop sky lounge.
Often, the best community engagement activities relate to sports and recreation. Consider initiatives such as softball and kickball teams at millennial-friendly properties.
Facilitating Educational and Professional Development
Some of the most successful community engagement activities are targeted toward younger residents and families, particularly as they enter the most critical stages of their career development. Investors can participate by sponsoring scholarships to help residents receive higher education or conduct internship programs to assist and support local college students.
The Bottom Line
By instituting programs that engage residents — especially those tailored to the individual community — property owners and investment managers can expect higher retention, greater tenant satisfaction and, ultimately, better financial performance for their assets. An upfront investment in residents helps to ensure that your property remains vibrant and creates a long-lasting sense of community that is also reflected in the bottom line.
By making resident wellness a priority and, when necessary, repositioning assets upon acquisition to improve the resident experience, investors can achieve the goal of “doing well by doing good,” fostering both happier residents and strong, risk-adjusted returns.