It is hard to think of those in need when you fear that you might be in need soon. However, taking that approach may be the solution to all of your potential problems.
Robert Ingersoll famously said, "We rise by lifting others". With COVID-19's financial impact threatening apartment owners across the country, most owners are highly focused on rent collection. As everything in multifamily, there are a lot of ways to achieve this goal. I have always believed that the path to successful apartment ownership can be found through lifting the surrounding community. During this challenging time, I believe the solution is found through that same approach.
Upon acquiring a new property, we not only notify the current tenants of the change in ownership, but also the greater community. Then, we do weekly outreaches to cultivate relationships with local business, charities, and organizations. Next, we partner with these groups to create events and giveaways that create a win-win situation. Taking this same approach, we are contacting these local businesses and asking for a discounted bundle of gift cards. We will be distributing these as gifts to residents who pay their rent early. Our goal is two-fold; first, to encourage tenants to pay their rent by providing them a discount in the form of a gift card to a local restaurant, and second, to create business for the small businesses who have been impacted in our community.
Anyone who knows me knows that I am a huge animal lover and advocate. To that effect, I always ensure the property's insurance does not have breed restrictions. Throughout the year, our properties host adoption events with the local humane society. During these events we waive all pet fees. As COVID-19's impact is also being felt by the humane society, we have extended the $0 pet fee for the unforeseeable future. Some of you may be scratching your head wondering how this simple act positively impacts our community. Let me break it down: 1) Obviously it benefits the animals who may have seen an unfortunate fate, and 2) It decreases the cost burden of the shelters, increasing the ability for the shelters to remain operating, as well as, pay their employees. Whether or not these employees live directly on our property, a competitor property, or somewhere else, from a macroeconomic view point, keeping as many businesses in business as possible only softens the financial impact that COVID-19 is having. Remember, you got into apartment ownership because it is a long play, and these seemingly incremental steps could have monumental impact, especially if we all take this approach.
This last idea is common sense, and one that I have yet to hear someone counter. It is imperative that we recognize and assist as many tenants as possible who are victims to COVID-19's financial impact. There are a lot of creative ways to help the tenants, from payment plans, to debt forgiveness, to signing new lease terms. Shifting one's mindset to not only thinking about how to capture rents, but also decrease the expenses that the tenants are covering, will prove to be very advantageous during this time.
Taking a step back and looking at what is going on today, it is interesting to see how truly interconnected we all are. The survival of one depends on the actions of all. At the end of the day, the properties that are going to rise, and survive this situation, are the ones that are able to lift their tenants and their community.