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APRIL MAY JUNE 2013
IN THIS ISSUE NATIONAL NEWS PAGE 3
Multifamily Sector Seriously Lacks Affordable Housing
LOCAL EFFECTS PAGE 4
Investors Returning Hipster Flair to Old Rat Pack Apartments Caesars Unveils Gansevoort Las Vegas
MANAGEMENT MINUTE PAGE 8 Benefits of Encouraging Renters Insurance
Management Quick Tip: Avoiding Hoarding
OCCUPANCY CORNER PAGE 10 MARKET ACCESS PAGE 11 ACCESSLASVEGAS
Apartments Key to Housing, Economic Recovery In the midst of the worst economy in a generation, the apartment housing contributed to $1.1 trillion to the national economy, according to a report from the National Multi Housing Council and the National Apartment Association. According to the report, apartments support 25.4 million jobs and apartment residents spend more than $420 million in expenditures for goods and services, including apartment furnishings, moving and cleaning costs and more. No, it's not just owner-occupied housing that contributes to economic growth. The apartment industry spent $14.8 billion on construction of 130,000 units in 2011. The industry also spent $67.9 billion to operate and improve the nation's 19.3 million apartments -- more than four times the amount spent on construction. And, of that $420 million apartment residents spend on goods and services, 70 percent remains in the local economy. Don’t believe us, see for yourself. A new web site, WeAreApartments.org, uses an interactive map to break down the data, state by state and by 12 select metro areas. This includes Nevada’s $12 billion dollar industry. The website's Apartment Community Estimator also allows users to enter the number of apartment homes in an existing or proposed community to determine the community's potential economic impact for the state. Dr. Stephen S. Fuller, of George Mason University's Center for Regional Analysis says attention is usually focused on homebuilding and the single-family sector, when it comes to the economic impact of housing. But the annual construction and operating outlays for apartment buildings also are major sources of economic activity, jobs and personal earnings, say Fuller. When someone rents an apartment they help the economy grow, over and over. APRIL | MAY | JUNE 2013
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Multifamily Survey Offers Peek at Rental Market By Megan Hopkins; HW Publishing LLC (HOUSINGWIRE) Renting a property or apartment long-term is the only viable solution for many Americans as lending standards stay tight and potential buyers struggle with down payments. This in turn makes multifamily ownership and development a bigger issue for the nation's housing agencies. Approximately 1 in 5 American households reside in multifamily rental buildings, according to data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The two entities launched a survey to provide more insight into the nation’s multi-family rental properties. "The Rental Housing Finance Survey fills an important gap in our understanding of who owns multifamily rental housing -- mostly individuals, not large companies -- and how multifamily rental housing is financed, especially as the structure of finance is changing," said Erika Poethig, HUD’s acting assistant secretary for policy development and research. To conduct the survey, HUD and the Bureau combined previously known information with newly researched data on property values, residential structures, rental status and value of units within the structures, commercial use of space, property management status, ownership status, and a detailed assessment of mortgage
financing and benefits received from Federal, state, local and non-governmental programs. With this data, HUD can better understand the multi-family rental loan origination volumes, property characteristics with these originations and operating cost and revenue characteristics for the multi-family rental space in the U.S. The survey found that in the United States, there are 2.3 million multi-family rental properties, of which 73% are just on building. Of the 2.3 million properties, only 77% provide parking and 19% contain buildings built prior to 1920. Of two-to-four unit multifamily rental properties, 54% have a mortgage compared to 85% of properties with over 50 units. Eight-seven percent of multi-family properties owners reported making repairs to their properties in 2010 or 2011, of which the median cost was $699 per housing unit. Sixty-nine percent of all multi-family rental property owners reported making capital improvements to their properties in 2010 or 2011, of which the median cost was $1,156 per housing unit. All the developments in the sector explain one key finding of the HUD and Census Bureau report: The agencies concluded that "Multifamily rental housing is critical to solving the nation’s affordable housing problems, and potential investors in the multifamily rental housing market will gain a better understanding of the ownership and financing structures of the industry with these data."
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Future Opportunity? Multifamily Sector Seriously Lacks Affordable Housing By Esther Cho; DS News The rental market may be flourishing, but finding decent, affordable housing is still a challenge for many renters, especially among the lower-income households, the National Low Income Housing Coalition revealed in a recent report titled Out of Reach 2013.
The report also noted most newly constructed apartments are for high income households, while older units are receiving upgrades to serve a higher income bracket. To meet the demand for affordable housing among ELI households, about 4.5 million affordable units would need to be added to the market, according the report. The report also ranked states based on their housing wage -- the full-time hourly wage needed to afford a decent apartment -- for a two bedroom apartment. In Hawaii, a person would need to make $32.14 an hour in order to afford a two-bedroom apartment, the most out of any state. Washington D.C. ranked second, where the housing wage is $27.15. The other three states in the top five were California ($25.78), New York ($25.25), and New Jersey ($24.82).
A person working full-time would need to make about $18.79 an hour to afford a decent apartment, yet the hourly wage earned by the average renter is $14.32, according to the report. Federal standards consider housing to be affordable when housing costs don’t exceed 30 percent of income. If one wage-earner earns $14.32 an hour, a household can afford to spend no more than $745 a month on rent, according to the report. Among extremely low income (ELI) renter households, affordable housing is an even greater issue. Yearly incomes for ELI households are no more than $19,810, which means these households can spend no more than $495 a month on rent.
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According to the report, for every 100 ELI renter households, there are 30 affordable housing units. The report estimates there are 10.1 million ELI renters in the country, and 76 percent of the ELI rental segment spends over half of their income on housing costs.
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The five most affordable states were North Dakota ($12.06), West Virginia ($12.35), Kentucky ($12.71), Arkansas ($12.76), and South Dakota ($12.82).
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Investors Returning Hipster Flair to Old Rat Pack Apartments
The complex, built in 1973, is slated to have mosaic art installations, a hotel-style leasing center, refurbished laundry facilities, a new bike storage area, pet walks, electric car charging stations, WiFi club rooms and new pool areas with colorful seating.
By Eli Segall; Vegas Inc.
The units already have stone fireplaces, wet bars, swag lighting and entertaining areas. According to Deco, the property was a “highly desirable” place to live for decades for celebrities and entertainers, including the Rat Pack -- Frank Sinatra, Dean Martin, Sammy Davis Jr., Peter Lawford and Joey Bishop -- whose members were occasional residents at the complex, then known as The Villas.
Some real estate investors want to bring back the style and charm of an aging Las Vegas apartment complex where members of the famed Rat Pack once lived.
Deco rehabilitates aging apartment complexes near retail, public transit and recreation and then markets them to young, urban professionals. The company bought Rainwalk from mortgage finance giant Fannie Mae, which had acquired the complex through foreclosure in August 2010.
Gansevoort Las Vegas will tout 188 guest rooms with 19 suites and features a Parisian apartment-style theme designed by local firm Tandem Las Vegas, which also designed boutique hotel Rumor. The renovation includes a 40,000-square-foot casino, a redesigned lobby bar, an ultra-lounge and retail outlets. “Gansevoort Las Vegas will be a completely unique upscale lifestyle experience in Las Vegas,” said Tariq Shaukat, executive vice president and chief marketing officer for Caesars Entertainment, in a statement. “It will set a new standard of fun and modern luxury, which only Gansevoort Hotel Group, Victor Drai and Caesars Entertainment can create. We are confident that Gansevoort Las Vegas will be one of the most exciting destinations in Las Vegas when it opens in 2014.” Drai’s will return to its original location, while the new Drai’s Beach Club and Nightclub will open in a 65,000-square-foot space alongside the property’s rooftop pool.
As recently as January 2005, at the height of the building boom, Rainwalk sold for $15.9 million -- more than five times what Deco paid.
If all goes as planned, residents will soon be sipping cocktails poolside, walking their dogs near mosaic art and charging their electric cars before heading out for a night on the town. Executives at Deco Communities, the new owner of Rainwalk Apartments, have their work cut out for them. The 104-unit complex near the Boulevard Mall needs physical and aesthetic upgrades and is surrounded by run-down apartment buildings. Deco bought the 3-acre property on Dumont Boulevard in November for $2.9 million. The Scottsdale, Ariz.-based company said Tuesday it will rename the complex Cabana on Dumont and immediately start a $2 million overhaul. More than 60 architects, master landscapers, construction workers and designers will work “around the clock” the next several months, the company said. Executives say the “first round of hip Las Vegas urbanites” can move in by summer. ACCESSLASVEGAS
Caesars Unveils Gansevoort Las Vegas By Andrea Domanick; Las Vegas Sun Caesars Entertainment announced that Bill’s Gamblin’ Hall & Saloon will reopen as Gansevoort Las Vegas, a standalone boutique resort scheduled to debut early next year. The new property marks a partnership among Bill’s owner Caesars Entertainment Corp., the New York-based luxury hotel brand Gansevoort Hotel Group and nightlife mogul Victor Drai, whose eponymous after-hours nightclub has been a mainstay at the location for the past 15 years. Bill’s Gamblin’ Hall & Saloon closed Feb. 4 to undergo a $185 million renovation.
“Drai’s After Hours has been a staple of Las Vegas nightlife for the past 15 years,” Drai said. “Drai’s set a new standard for the late-night entertainment experience in Las Vegas, and I’ve successfully raised the bar for that experience with each new venue I’ve launched. I’m thrilled to have the opportunity to once again reinvent and reinvigorate the nightlife scene right where it all began 15 years ago. “Drai’s Beach Club and Nightclub, set atop the renovated Gansevoort Las Vegas, will be unlike any other club venue in the world. I’m looking forward to entertaining guests in this beautiful rooftop venue as well as reintroducing After Hours by Drai to the resort.” APRIL | MAY | JUNE 2013
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Downtown Project Snapping Up Apartment Building, Other Parcels By Joe Schoenmann; Las Vegas Sun
• 113 Fourth St., .15 acres, $1.1 million.
A group purchasing property all over downtown is close to finalizing a deal for the 360-unit Mayan Plaza apartment building on Alta Drive, next to the new Metro Police headquarters.
• 1322 Fremont St., .46 acres, $1.9 million (includes building).
Sources say the group, including Zappos CEO Tony Hsieh, has targeted the 15.4-acre parcel at 1700 Alta Drive because it needs housing downtown for some of Zappos’ 1,300 employees who will be working there this fall. County records show the 24-year-old property sold for $18.8 million in 2003 to Greenlawn Property LLC, a California-based company.
• 701 Bridger Ave., .89 acres, $10 million, includes building and will be the future home of a medical clinic. The five targeted properties: • 828 Commerce Ave., a large building and parking lot in the Arts District, .47 acres. • 117 Fourth St., .16 acres, no recorded sale.
In September and October, Zappos will be moving its headquarters from Henderson into the former City Hall in downtown Las Vegas. Zappos has spent more than a year renovating the building.
• 302 Carson Ave., .48 acres.
For company employees who might want to live close to work, however, downtown residential housing and apartments are scarce. Many Zappos employees live in Henderson or Summerlin, away from the city center.
• 800 Fremont St., .16 acres, (future home of a dog park).
The Downtown Project, which includes Hsieh, is investing some $350 million into education, entertainment, real estate, and small and tech businesses downtown. Some $200 million of that amount is going into real estate. A year ago, Downtown Project considered creating residential housing itself; New York designers sketched plans and ideas for functional, small units. Hsieh said last weekend that idea was still being considered.
• 915 Carson Ave., .19 acre.
The new parcel purchases surprised some people downtown, especially after Andrew Donner, in charge of purchasing real estate for the downtown partnership, announced in December that it had “the critical pieces that we need.” The hallmark of Hsieh’s Downtown Project has been an unprecedented openness as it sells itself as being dedicated to creating and improving community downtown. When Donner made his comment about having all the critical pieces, downtown partners had purchased just $45 million of parcels. Since then, recorded property sales to the group, including the four listed here, total just under $110 million.
The Mayan Plaza currently advertises a “$275 move-in special” and one month of free rent with a 13-month lease. One bedrooms go for $650 and two bedrooms from $750 per month.
The number of parcels now purchased, including the handful targeted, is close to 90, which totals about 50 acres.
State records show the downtown investment group formed a limited liability company called “1700 Alta LLC” last October, presumably to purchase the property.
Hsieh said the ongoing purchases don’t signal a change in Downtown Project’s vision for downtown. However, he said, “if a good deal comes up, then we’ll take a look at it.”
Most of the group’s downtown property acquisitions followed formation of an LLC that is given the same name as the targeted property’s address.
He said Donner’s company, Resort Gaming Group, has been the project’s real estate partner and is the “decision maker in each deal.”
Aside from the Mayan Plaza property, the Sun found four additional parcel purchases recorded as sold to the downtown group, plus another five whose addressed became the name of four new LLCs whose members include Hsieh and others.
“Their directive has been to use their best judgment and to be open-minded whenever an opportunity comes up,” he said.
The four purchased properties are: • 221 and 230 Eighth St. This double-parcel property includes a large complex with multiple units on 1.29 acres. Purchase price: $6.7 million.
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Famous Construction Failures Remind Vegas of Fragility
Last summer, Clark County officials ordered Boyd to install strategically placed coverings to hide the skeletal frame of the interrupted construction.
By Vegas Inc. Staff; Vegas Inc.
The groundbreaking is planned for 2014, with the first phase opening in 2016.
For at least one stalled project in Las Vegas, there's hope.
On Monday, executives for the Genting Group, a Malaysian multinational company, announced plans to build a 3,500-room Chinese-themed resort with a 175,000-square-foot casino. The company plans to build a replica of the Great Wall of China and develop an enclosure for pandas for public display. The resort also is expected to have a convention center and an indoor water park.
Fontainebleau There is arguably no greater symbol of the valley’s economic struggles than the unfinished Fontainebleau, a $2.9 billion would-be Strip resort that became the nation’s largest commercial construction project to go bankrupt. Snapped up by financier Carl Icahn at a U.S. Bankruptcy Court auction in 2010 for just $150 million, the resort has sat abandoned since then despite the fact that it is 70 percent complete. Many analysts doubt the 63-floor, 3,815-room hotel will ever open. Its prized furnishings were sold to other hotels. Late last year, Caesars CEO Gary Loveman came up with a new plan for the Fontainebleau.
An Asian gaming powerhouse announced its plans to build a $2 billion megaresort on the site of the stalled Echelon, which has sat unfinished since 2008. But many other projects launched during the boom and abandoned during the bust remain untouched.
"Perhaps one of the poster children for this is the still-unfinished Fontainebleau here in Las Vegas, which was perhaps not a very well conceived project from the very beginning and is likely someday to find its future as a scrap metal liquidation effort for Carl Icahn," Loveman said. Harmon Hotel
It wasn’t long ago that hotels, high-rise condominiums and massive retail complexes seemingly sprang up daily. Today, many of the vestiges remain: partially built structures with exposed foundations and steel beams.
Originally planned as a 49-story building at CityCenter with a 400room hotel and 21 floors of condos, the Harmon got scaled back by owner MGM Resorts International in January 2009, when the company announced it would build only the hotel portion of the project.
Many of the mothballed projects face an uncertain future, signs that their owners either don’t have the money to complete them or don’t think the economy has recovered enough to make them viable.
The announcement followed reports of major construction flaws throughout the building. The Tutor Perini Building Co., the general contractor, alleged that design problems also were to blame.
Here are Las Vegas’ most famous stalled projects:
Today, after years of litigation, the Harmon remains unoccupied, facing an uncertain future.
Echelon The planned $4.8 billion Boyd Gaming resort sat in limbo for several years after the company decided in August 2008 to halt the project. Taking up 87 acres that once housed the Stardust, the Echelon was supposed to open in 2010 with almost 5,000 rooms spread across five hotels, a casino, a convention center and theaters. But Boyd found it tough to obtain the financing needed to complete the construction and called for the work to stop, preventing the company from going into bankruptcy. ACCESSLASVEGAS
A Nevada state judge gave the go-ahead in July for MGM Resorts to implode the hotel tower, but that decision was appealed and remains embroiled in litigation. The Shops at Summerlin The planned mixed-use development just south of Red Rock Resort at Charleston Boulevard and the Las Vegas Beltway was supposed to open in fall 2009 with Nordstrom as an anchor tenant. CONTINUED PAGE 7 APRIL | MAY | JUNE 2013
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But developer General Growth Properties ran into major financial troubles, forcing it to file for Chapter 11 bankruptcy reorganization. Construction of the shopping and office plaza was halted in 2008.
But the recession prompted the developer to stop construction the following year after the foundation was built. The site sits untouched today.
The company emerged from bankruptcy in November 2011, and the Howard Hughes Corp., a company spun off from General Growth, acquired the mall.
Spanish View Towers
In September, the Howard Hughes Corp. announced that the shopping hub was back on track with Macy’s as an anchor tenant. The project is slated to open in late 2014 with more than 125 stores and restaurants. ManhattanWest The 21-acre mixed-use development on Russell Road was to feature more than 600 condominiums, along with 200,000 square feet of shops, restaurants, and hotel and office space. Construction began, but owners announced in December 2008 that it was put on hold after financing was cut off. The dispute turned nasty with Gemstone Development, a bank, a motel company and other parties embroiled in an ongoing lawsuit that involved allegations of fraud. Late last year, the Calida Group real estate firm reportedly bought ManhattanWest out of bankruptcy for $21 million to $23 million. Mercer In the summer of 2008, JDL Development began work on the exterior frame of the Mercer, a 113-condominium complex planned for Tropicana Avenue near the Las Vegas Beltway. But a year later, all that was left was the concrete foundation and underground parking area. The developer abandoned the project after determining that the condo market had turned sour. Parkline Lofts Parkline Lofts announced in 2006 that it would build a three-story building with 65 condos at Basic Road and Pacific Street in Henderson as part of a downtown redevelopment project.
Spanish View Towers near the Las Vegas Beltway and Buffalo Drive was supposed to have three 18-story luxury condo towers with more than 400 units. Work started in 2005 but stopped a year later after the complex's underground parking garage was partially built. The downhill slide continued in 2007 when owner Tower Homes, which was accused of not paying its bills, went into bankruptcy. The property was bought in 2009 by its financiers, OneCap Mortgage and Realtor Jack Woodcock, but never progressed further. People who placed nonrefundable deposits on the condo units and claimed they were duped into signing sales agreements for the doomed project reached a settlement in 2011. St. Regis Residences Las Vegas Sands Corp. announced in September 2008 that it would build 398 luxury condos between the Venetian and Palazzo, with the homes set to open by March 2010. But steel beams were barely in the ground when the company, citing the tanking economy and slumping condo market, halted construction in 2008. The incomplete project was later camouflaged with a wrap intended to make it look like a finished product. Uptown What was supposed to be a three-building complex with 75 condominiums on Centennial Parkway in North Las Vegas remains only partially built years after its first residents moved in. Blue Marble Development purchased the distressed property but has said it is waiting for the economy to rebound before completing the project.
Vantage Lofts In 2005, Slade Development introduced the corner of Gibson Road and Paseo Verde Parkway in Henderson to the concept of “minimalist modern” with a contemporary residential complex of condominiums priced to sell from $400,000 to $1.6 million. But three years later, the $160 million project remained only partially built and boarded up, yet another victim of a battered housing market. The 20-acre property was acquired last summer by a venture capital fund whose owner said construction could be completed in six to nine months. But as of early this year, it remained in the same state of disrepair.
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Benefits of Encouraging Renters Insurance By Mary Girsch-Bock, PropertyManager.com
the property owner and the resident are covered.
Whether you’re managing multi-family units or single family homes, as a property manager, a large part of your job is to maintain the condition of the property you are managing. That’s why it’s in your best interest to encourage your residents to purchase renters insurance.
For instance, If Lisa is renting from a property management company and she accidentally starts a grease fire that damages the property and also burns the apartment next door, it’s not the property manager, nor the owner that is responsible for paying for the damage. It’s Lisa’s responsibility. With renters insurance, those damages are taken care of; otherwise the cost of those damages comes out of her pocket.
What most renters don’t realize is that in the event of a fire, theft, or other disaster, while property insurance will cover structure loss, it will not cover replacement of possessions, or thwart a lawsuit from an accident that happens at their home or apartment. While policy types and premium costs vary according to needs, most renters insurance policies are extremely affordable, ranging from $250.00 to $350.00 a year. This is a minimal investment to ensure that both
Here are some important items to think about: Let them know before signing a lease. If you’re
Management Quick Tip: Avoiding Hoarding Hoarding -- the obsession to collect and retain too many belongings -- is a dangerous practice that costs landlords. Hoarding causes property damage, encourages pest infestations and other health risks, and compromises the safety of the tenant and those around them. To avoid hoarding in your rental properties: Include “anti-hoarding” provisions in your lease, like specifying that stairwells, hallways, exits, patios or balconies, and vents must all be kept clear; storage is limited to the spaces provided; and, prohibiting
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considering implementing a policy that requires residents to purchase renters insurance, be sure that ALL prospective applicants are aware of this prior to filling out an application, and well before signing a lease.
Make it easy to understand. Lay out coverage requirements in an easy to read document that residents can refer to when looking to purchase the required coverage. Ensure levels purchased are sufficient. While it’s important for residents to be able to purchase insurance from their desired company, it’s up to management to ensure that the levels purchased are sufficient. You may also want to consider
teaming up with an insurance partner that can offer current and future residents an easy way to purchase renters insurance. Communicate the benefits. Be sure to show residents the benefits they will derive from having this protection. Many renters are unaware that their possessions are not covered by management/owner insurance. Give them payment options. Consider implementing a program where residents can pay their renters insurance premiums with their rent. Renters insurance is an absolutely marvelous resource that most renters do not take advantage of. Requiring residents to purchase renters insurance is a win-win for both property managers and residents, and an affordable way for both of you to have some peace of mind.
stockpiles of flammable materials that become fire tinder. Reserve the right to evict a tenant who cannot abide by the rules. Also, explain in your lease how hoarding is a serious health hazard to not only the hoarder but residents living around their unit. ALWAYS limit the overall number of pets that can reside in the unit, subject to eviction as well. Pets can additionally cause serious health concerns, due to defecations which are not found and create unbearable stenches which can permeate into other nearby units. If you know of a tenant, or if a nearby resident suspects a tenant who may be hoarding, allow yourself or management company to perform frequent inspections. This ensures that pathways are clear and the property meets fire and building codes, or this is the appearance you can give the hoarding tenant. Safety first! APRIL | MAY | JUNE 2013
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New Apartment Technology Trends By: Michael Mino, PropertyBoss Solutions (Part 1 of a 2 Part Series) Before we review a number of technology trends, let’s review when technology should be incorporated into your business. Technology implementation should make you money, not cost you money. There are two ways of accomplishing making money with technology: increase revenue or decrease/eliminate expenses. The most favorable application of technology occurs when you can increase revenue and reduce recurring expenses. As shown in the graph, implementing a payment portal does both. The payment portal reduces the time your staff spends processing payments and it should attract more business. On the opposite end, buying a touch display most likely neither increases revenue nor reduces expenses. We often make purchases in this category because they are “cool.” That’s fine, as long as we recognize these purchases may not be improving the bottom line. To provide a framework for organizing these many different technology trends, we have grouped technology into the following categories: • Mobilization • Visualization • Socialization • Virtualization • Personalization The first two categories are addressed in this newsletter, with the remaining three covered in the next ACCESSLASVEGAS newsletter.
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supplementing the traditional desktop/laptop format with a version optimized for the mobile display. There are some more automated applications for the do-it-yourselfer suchas DudaMobile (first ten pages are free) and FiddleFly. Google has also recently released its own configuration service. These tools can assist in the creation of web pages formatted for your target mobile devices. Making your website more “mobile aware” is also helpful if you are using mobile tagging marketing tools like Quick Response (QR) codes to draw prospects to property detail pages. Codes can be easily generated and placed on business cards, printed marketing materials, and property signs. If using QR codes on signage, be aware that the size is important. A one- inch code can be read up to one foot away. A one- foot code can be read up to a 12-foot distance. The next step is to make your website “location aware” by using the mobile device’s location information to display listing data associated with the property within their proximity. This application would provide directions for the prospect to conduct a drive-by displaying relevant data as they approach each property. The real game changer in the mobile world is augmented reality. You have seen the iPhone commercial that overlays shopping and eating options on your current visual space. This software combines internal GPS location awareness with the camera to provide user input and feedback on your current field of view. Imagine taking an augmented reality tour of a property observing (and hearing) pertinent information as you walk from room to room. Visualization
Mobilization
The old adage, “seeing is believing,” has never been more true when it comes to marketing your properties, and your company’s brand, online and in print.
Based on the barrage of advertising we are inundated with daily, it’s easy to believe that few people are actually working at their place of business anymore. Mobile devices like smartphones and tablets can help property managers who are out and about throughout the day. But which is the better fit for your business?
Digital photography improvements over the years have made the need for professional photography nearly obsolete in property management and real estate offices. Most affordable cameras (and even camera phones) have more than enough resolution to enable quality photos of listings to be captured and featured in web marketing.
The answer largely depends on the tasks you need to accomplish when you are in the field. The difference in screen size (the diagonal screen on the iPhone is 3.5 inches vs. the iPad at 9.7 inches) significantly affects the functions that can be effectively performed on these mobile devices. The tablet format provides almost eight times the display area in this example.
Tagging is critical to helping people find your pictures on the web. The most important signal you can provide is the filename of the picture when you upload it to your website. The second approach is to include keywords in the metadata of the image itself.
This larger size makes the tablet a better choice for more complex tasks like in-the-field inspections, violations tracking and using a full featured software application. The smaller display of a smartphone would require many screen changes to accomplish the same activity and you cannot see the big picture view. Smartphone apps are best for single functions like paying rent, entering a work order, retrieving contact information, and accessing property data and status. Property management / property websites must have a configuration for mobile devices. This need for mobile configuration is particularly true for web pages that are information rich and require a lot of scrolling to view the page. Contact your website developer to discuss what options they offer. The best approach is to redesign each page
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The third method is to include these keywords in the alt and title html tags of the web page that references the image. Applications like Facebook and Flickr take this tagging process to another level by including a notification system and providing linkages within their network. Choose your tagging keywords carefully. Consider how you believe people find you or how you want them to find you. If your target is finding new tenants, what region, area, community, or neighborhood do you specialize in? The more specific the tag you create, the better you will be found among the noise. Most filenames we see look like “1234 Shadowlawn Kitchen.” It is unlikely that someone will search for that specific property. Instead, consider naming your image file CONTINUED PAGE 10
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“Mountain’s Edge -- Las Vegas -- Kitchen 1234 Shadowlawn” and include descriptive tags in the metadata and web page tags. Video marketing is the new frontier. If a picture is worth a thousand words, then video is worth a thousand pictures. Videos of available properties can greatly improve lead-to-lease turnaround time. Research has shown that people are much less inclined to read detailed write-ups. Instead, they gather information from observations. Do you put these videos on your website or reference them on a site like YouTube? What video (MPEG-4, H.264, Theora) or file (.mp4, .flv, .ogv) format do you use? Various web browsers (IE, Firefox, Chrome, Safari) support different formats and platforms. For example, the iPad/iPhone operating system does not play Flash files. The advantages of using YouTube to host your video tours, etc., include increased exposure to available listings, additional tagging capabilities for location and other amenity searches, as well as using their bandwidth rather than your website’s. In Closing (... For Now!) The decision to embrace new technologies -- mobile, visual, social, virtual, personal or others -- must be made after carefully considering whether the benefits outweigh the costs, or if the “juice is worth the squeeze.” Look for more trends next month in the continuation of this article in next quarters ACCESSLASVEGAS.
Las Vegas Metro Occupancy Results March 2012 through February 2013 March 2012
91.02%
April
90.59%
May
90.81%
June
90.38%
July
90.44%
August
90.34%
September
89.88%
October
90.05%
November
89.77%
December
90.01%
January 2013
90.17%
February
90.28%
87%
88%
89%
90%
91%
92%
2013 Occupancy Average: 90.22% Source: Spencer Ballif and Jeff Swinger of CB Richard Ellis (Las Vegas) (118,959 Apartments Surveyed in February 2013) ACCESSLASVEGAS
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MARKETACCESS PAGE 11
Y O U R A C C E S S T O T H E L A S V E G A S M U LT I - F A M I LY H O U S I N G M A R K E T
Las Vegas Multifamily Access Source: Colliers International
RESEARCH & FORECAST REPORT – LAS VEGAS (for Q4 2012) According to statistics provided by REIS, multi-family vacancy in Southern Nevada decreased in the third quarter of 2012 (the most recent quarter of available data), continuing a ten quarter trend in declining vacancy. Vacancy stood at 6.8 percent in the third quarter of 2012, a decrease of 1.1 points from the third quarter of 2011. Class A properties enjoyed a 6.2 percent vacancy rate, lower than Class B and C properties, which had an overall vacancy of 7.4 percent. Most submarkets showed positive net absorption, the exception being the East and West Central submarkets, which combined for only 3 units of negative net absorption, and were thus essentially flat. Effective rents were up 4.4 percent over last quarter and 7.2 percent over last year, and stood at $824 per unit overall in the third quarter of 2012. Class A properties posted an average asking rent of $944 per unit, compared to an average asking rent of $718 for Class B and C properties. As rents rise, folks who are lurking on the margins of the multi-family market may decide that 2013 is their last chance to find a deal. REIS predicts that the next two years will see multi-family vacancy dip to as low as 5.3 percent before new construction begins driving vacancy rates back up. REIS predicts over 10,000 multi-family units will be added to the Valley’s inventory over the next four years, with most of it currently planned for the Henderson/Southeast and North Las Vegas submarkets. While a reset in home prices has made buying a home very affordable in Southern Nevada, many people are still opting to rent multi-family. Recent moves by key investors in the market are likely to keep single-family rents suppressed in the near term, and this might impact multi-family rents in 2013. According to Real Capital Analytics, there were 11,149 units in distressed multi-family projects in Southern Nevada in the fourth quarter of 2012, an increase from the third quarter of 2012. The distressed category includes properties that have received a notice of default, as well as troubled properties and those that are in some stage of the foreclosure process. Over the past twelve months, distressed multi-family projects consisting of 12,554 units have been resolved and another 644 units have had their loans extended or restructured. Distressed properties that were resolved had an average occupancy rate of 89 percent. Multi-family sales continued to rise in 2012, with 8,930 units selling at an average price per unit of $52,279. Compare this to 2011, when 7,399 units sold at an average price of $51,700 per unit. Multi-family sales reached their nadir in 2009, when only 822 units traded, and the past two years have been nothing less than a renaissance for multi-family. Cap rates averaged 9.1 percent in 2012, compared to 8.0 percent in 2011 and 7.9 percent in 2010. In general, buyers appear to be investigating Class A properties, but the sales are in Class B/C properties. According to data from Real Capital Analytics, approximately 94.7 percent of all sales in 2012 were of Class B/C product. Tax increases brought on by the eminent plunge over the fiscal cliff could be a winner for multi-family investment, encouraging tax-deferred exchanges.
Access Investment Offerings COMMUNITY (UNITS)
ASKING PRICE
PER UNIT PRICE
Winsome West Apartments (228)
$ 20,000,000
$ 87,719
Elite Realty Inc. / 702.743.8991
Amber Ridge Apartments (316)
$ 16,600,000
$ 52,532
NAI Sauter Companies / 702.383.3383 x1
Cambridge Park Towers (209)
$ 14,990,000
$ 71,722
Commercial Professionals / 702.792.3440
$ 10,845,000
$ 75,313
ACI Apartments / 619.300.8090
$ 4,950,000
$ 26,470
Cushman & Wakefield / 702.236.7883
Cypress Springs (144)
CALL FOR OFFERS
Stay Suites of America (187)
BROKER / CONTACT INFORMATION
Access Recent Transactions COMMUNITY (UNITS)
CLOSING PRICE
PER UNIT PRICE
CLOSING DATE
BUYER
The RItz (198)
$ 13,885,000
$ 70,126
March 1, 2013
Sunrise Springs (192)
Unpublished
Unpublished
February 28, 2013
Bridge Investment Group US Bank - REO
Majestic Heights (240)
$ 8,633,698
$ 35,974
February 28, 2013
Conix
Sonterra (350)
$ 9,512,516
$ 27,179
February 28, 2013
Conix
Toscana Villas (270)
$ 8,211,725
$ 30,414
February 28, 2013
Conix
For additional information and / or broker information on Access Investment Offerings and / or Access Recent Transactions contact Bret Holmes at 702.699.9261.
ACCESSLASVEGAS
APRIL | MAY | JUNE 2013
ACCESSLASVEGAS 2775 South Rainbow Boulevard, Suite #101-C Las Vegas, Nevada 89146 702.699.9261
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Y O U R A C C E S S T O T H E L A S V E G A S M U LT I - F A M I LY H O U S I N G M A R K E T
Advanced Management Group Adds Downtown Project To Expanding Portfolio Advanced Management Group, a real estate management company providing advanced property management, financial and accounting, and asset management services for multi-family properties in Las Vegas, recently added a big player in Downtown Las Vegas to its ever expanding portfolio (see Page 4 article “Downtown Project Snapping Up Apartment Building, Other Parcels”). The Downtown Project has chosen Advanced Management Group to oversee operations with multiple sites they have recently purchased in Vegas’s famed downtown. “We are very excited to be chosen to help improve downtown’s stigma and partner up with an amazing project,” said Advanced’s President Bret Holmes. “An opportunity like this maybe comes once every decade ...,” Holmes stated. “We care about our assets and so
do our owners. Why? Because we think like owners and give you the attention most property management companies can’t ...,” Holmes concluded. With this additional portfolio, Advanced Management Group now manages more than 7,000 units in Las Vegas, placing them in the top 5 in the valley for 3rd party managed units. Pretty impressive for a property management company that started just 7 years ago! Advanced Management Group’s team of professionals has over 50 years of property management experience, which includes conventional multi-family, single family (United Management Group), weekly / extended stay assets and hotels. Don’t you want your asset to be Advanced? Get the most Advanced leadership in the industry today, contact Advanced Management Group directly at 702.699.9261. In a market that changes daily, sometimes hourly, your asset can’t afford anything less than being Advanced. For information, article consideration and featured columns ACCESSLASVEGAS can be contacted at 702.699.9261. The publisher of this newsletter is:
www.somebodymarketing.com
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APRIL | MAY | JUNE 2013