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Real Estate Institute of Canada

Exchange VOLUME 15 • ISSUE #1/2 • May 2013

www.reic.ca

REIC Annual Conference & AGM

Targeting Consumers the 21st Century Way Property Management Plans Made Easy Engaging the Millennial Generation


Inside This Issue

Inside This Issue

President Suzanne LeValley, CPM‰, CMOC Vice President Ron Fraser, CPM

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Setting Your Sights on Toronto!

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REIC News

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Targeting consumers the 21st century way

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Engaging the Millennial Generation

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property management plans made easy - gathering data

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Chapter Updates

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Member Profile

Secretary/Treasurer Winson Chan, FRI, CRES, MBA Executive Director and CEO Maura McLaren, CAE Editor Pam Seran-Wallace, Manager Communications and Marketing About REIC

REIC is a provider of advanced education and designation programs to professionals in the real estate industry. With 14 Chapters across Canada, we have been educating and certifying professionals since 1955. 208-5407 Eglinton Avenue West Toronto, ON M9C 5K6 Tel: 416-695-9000 or 1-800-542-7342 Fax: 416-695-7230 www.reic.ca For sales information call (416) 512-8186 ext. 262 Published by MediaEdge Communications:

5255 Yonge St., Suite 1000 Toronto, Ontario M2N 6P4 E-mail: info@mediaedge.ca Tel: 416-512-8186 Fax: 416-512-8344

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REIC Exchange, May 2013


REIC Annual Conference

Setting Your Sights On

Toronto!

Join us at the 2013 REIC Annual Conference and AGM in the vibrant city of Toronto. This year’s conference promises to keep your mind active and your body moving with topical information sessions and a fun, guided walking tour of downtown Toronto. Pre-conference Sessions Chapter Chat: Join chapter colleagues for presentations and discussions on best practices, successes and challenges in chapter management. A great opportunity to meet, share, learn, and get inspired! IREM Leadership Conference Reception & Dinner: Meet and mingle with IREM leadership and member colleagues; celebrate Chapter Star award recipients. IREM Leadership Conference: Learn new leadership techniques to apply at your workplace or chapter. The workshop is led by Cindy Clare, CPM®, President of Kettler Management. Cindy is also an IREM faculty member. REIC WELCOME RECEPTION Meet up with members from across Canada and your National Board at the REIC Welcome Reception. Partake in delectable finger food and specialty drinks from the bar in the stately Library Room of the Fairmont Royal York. Professional Development Sessions Learn the latest winning strategies for online marketing, engaging the new millennials, and effective time management from expert speakers: Kathy Hogeveen (consultant, online marketing), Neil Thornton (Partner, Trigger Strategies) and Hellen Buttigieg (award winning author). A door prize draw takes place at the end of the session, but you must be in the room to win!

networking opportunities The conference program offers many opportunities for networking including session breaks, meetings, dinners and receptions. Connect with colleagues while enjoying a fun-packed guided walking tour of downtown Toronto. Work in teams to win the scavenger hunt. In the evening relax, mingle and dine at the famous Wayne Gretzky’s. The day ends with The Second City comedy production of The Meme-ing of Life. Celebrating Successes It's Oscar® night at the REIC Awards Dinner and Dance! Join us as we celebrate our 2013 award nominees and recognize the award recipients. Stop and pose for the paparazzi as you walk the red carpet to the Awards reception. It will be an evening to remember! Register for the full conference or purchase single event tickets! Visit the REIC website at www.reic.ca or contact Natalie Wallace at natalie.wallace@reic.com or extension 270.  Hotel Accommodations REIC has reserved a block of rooms at the Fairmont Royal York for delegates at a rate of $189 + taxes for single/double. To book your room, please visit: resweb.passkey.com/go/ reic2013 or call 1-800-633-7229 / 1-800-441-1414 (and mention the REIC Conference). Rooms are being held for REIC delegates until May 31, 2013.

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REIC News

REIC NEWs New Canadianized HRS and MNT Courses Get Official Launch In April, IREM lead instructor Natalie Brecher, CPM® was at REIC National to oversee the inaugural launch of the fully Canadianized MNT402: Property Maintenance and Risk Management as well as HRS402: Developing Human Resource Essentials for Real Estate Managers. Instructors Saadat Keshavjee, CPM, CMOC, Jean-Francois Bigras CPM and Suzanne LeValley, CPM, CMOC, presented to an engaging group of students from a wide range of backgrounds and diverse portfolios. The overall feedback from the students was very positive. “The Canadian content addresses all topics and the videos are very effective,” added Suzanne. REIC 2012 Annual Report Available REIC had another successful year in 2012. Student enrollment remained steady, course materials were revamped and the Board launched major initiatives including a new Strategic Plan for REIC. You can get the full picture in REIC's 2012 Annual Report which is posted on the REIC website (login required). The 2012 Annual Report will be distributed to delegates at the REIC 2013 Annual Conference and AGM being held in Toronto this June. New Look for REIC Course Materials REIC's lineup of courses received a face-lift with colour, graphics and modern formatting. Not only does REIC look good, but student learning experience is enhanced.

IREM Foundation Scholarship for Property Management Candidates Imagine getting partial tuition for up to three courses! Candidate members pursuing a CPM®, ARM® or ACoM designation are eligible to apply for financial assistance from the IREM® Foundation Scholarship Program. Program details and application form can be found on the REIC website under Education and Training>Courses. Candidates are encouraged to take advantage of this scholarship plan. New REIC Strategic Plan REIC's new Strategic Plan, Strong Foundations, Bright Future, was unveiled to Chapters Leadership via web conference early this year and all members were mailed a print copy of the plan. The Strategic Plan honours our past, our strong foundation, and outlines the vision for REIC for a bright future. The plan includes goals and strategies that will guide the efforts of the Board, staff and our Chapters for the next three years. REIC's mission and vision has been refined as follows: Mission The Real Estate Institute of Canada's objective is to advance professionalism in the real estate industry. Vision Our vision is to be an organization leveraging our diverse expertise to benefit all stakeholders. The Strategic Plan will be highlighted at the 2013 Annual General Meeting this June. The plan is available on the REIC website under Member Resources (login required). 

UPCOMING COURSE SCHEDULE RES201: Successful Site Management - Calgary: June 10-15, 2013 Taking charge and being practical are the guiding principles of this course. Learn proven multi-family housing management skills and trends and issues that affect the housing industry. MKL406: Marketing and Leasing Office Buildings - Toronto: June 13-14, 2013 Learn marketing and leasing essentials to keep your operation ahead of the competition. This course, which was launched in Canada in 2012, covers major aspects of market analysis, effective marketing practices, and successful lease negotiations for office buildings. The course meets the education requirements for the CPM® designation. FIN402: Investment Real Estate - Financial Tools - Toronto: June 24-25, 2013 Take control of your property's financial outlook. Investment Real Estate - Financial Tools helps you calculate important financial components and establish yourself as a strategic partner with your clients! REIC2340: Mortgage Lending for Residential Housing – Toronto: July 8-10, 2013 This course, designed to sharpen risk assessment and risk management skills, is fundamental to anyone involved in underwriting residential mortgages. For registration or for further information, visit www.reic.com or email the Education Department at education@reic.com. Check the REIC website for the most current course schedule. 4

REIC Exchange, May 2013


Conference Speaker Spotlight

Targeting consumers the 21st century way By Kathy Hogeveen

The internet started as an information portal for many of us. The first major switch occurred when the general public began creating content as we recognized the knowledge of the individual could be shared effectively through sites like wikipedia. This was the onset of participation rather than consumerism. We have to admit that content has a social life. Acknowledging, respectfully that people will add to the conversation and interact with written words, images, and videos online, changes the entire relationship we have with our clients and prospects. Their role is one of participant. Humans love to interact with others in meaningful ways and have a self serve mind-set. They expect to discover the answers to everything online. These two elements create the perfect storm for creating the answers to the questions participants will ask. With this in mind, discoverability takes on a much bigger definition. Most buying decisions begin with the use of search engines. When we are planning our marketing campaigns we have to ask ourselves “What action do we want people to take?” Then we lead to “How do we measure those actions?” and “who has the data?” When we approach our social web presence with

these questions in mind we are more likely to encourage participation, connecting to content, community building and create an educational experience for our clients and prospects. The practices of Search Engine Optimization and social media marketing are becoming more cohesive. Web presence optimization is a more holistic approach to internet marketing that encompasses many facets of digital marketing – with social media, content marketing, and SEO being the most pivotal. A social community is the glue that holds your web presence together. A community has greater potential to develop lasting loyalty and respect, as well as share your content with other friends

and social connections. In essence, social media can aid your content marketing efforts, and thus your SEO strategy. Great content can inspire and motivate your audience, all while instilling loyalty, trust, and confidence in your brand. This can be highly beneficial in a competitive market space, and can drastically shape your overall web presence. With more than a billion people around the world participating in some form of internet social media, REALTORS® are in an excellent position to bring powerful social media tools such as Blogging, Facebook, LinkedIn, Twitter, Google+ and YouTube into the business of buying and selling property. These tools are transforming the way business is done. Business principles do not change but practices do. 

Kathy Hogeveen has over thirty years in the real estate software industry and extensive experience in sales and marketing. Kathy is a guest speaker at the REIC 2013 Annual Conference in Toronto, June 5-9. www.reic.ca

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Conference Speaker Spotlight

Engaging the

Millennial Generation for Business Success…

By Neil Thornton

Top 8 business lessons we have learned A quick definition of a millennial is anyone who was born between 1981 and 2000, and represent the 20-something group now entering the work arena in full force. Dealing with and managing the expectations, demands, work ethic, and contribution of the millennial generation, also known as Generation ‘Y’, is a question consultants get asked frequently. The following is a list of key insights into engaging this group in the world of business today. This list is the product of years of experience, research and hard work. I hope these ideas will help you build your winning business team and strengthen your ability to compete and remain relevant in quickly changing markets, demographics and service expectations. 1. Ensure clear expectations are communicated and understood We see a misalignment here everywhere, within all type of companies. When we ask people what they feel is expected of 6

REIC Exchange, May 2013

them, it rarely matches what managers/ owners are looking for. We tend to not communicate well, so we all need to be better at this. Younger generations are looking for clear direction, mentoring and support. We need to ensure we get this correct, right from the start. 2. Follow your passion. (Does this still apply?) We are asking young people to make career decisions earlier than any other generation. With shortened high school tenure and pressure to find direction, most millennials are very unclear about where they want to work, as well as direction and goals. Let’s help them instead of pressuring their decisions. 3. Resisting technology is futile Let’s face it, the millennials are wired and connected. They are the Google generation and utilize new technologies in all aspects of their lives. They use social media and texting as a preferred way to communicate. If your business is not set up to handle technology, you will get left behind.

4. Giving an ‘A’, and concept used in teaching that translates well into business For years, I have taught a college business course and have utilized a concept called The Practice of Giving an ‘A’, originally developed by Ben Zander in his book, The Art of Possibility. This technique asked students to grant themselves an A-grade for the course by writing a letter dated the last day of the term explaining in detail what they did in the term to earn this extraordinary grade. The test in human nature on this concept is incredible. Each student grades themselves on their performance, already pre-determined. This practice translates beautifully in the business world via the power of individual vision. 5. Utilize 90 day plans to ensure everyone is on track and focused This practice is not only critical for the direction and success of your younger employees, but any team member in the organization. Using three- month planning, with measured and reported benchmarks


6. Please remember the power of recognition The number one human need in business is the recognition of a job well done. For the millennial generation, this is a major factor in job satisfaction. Most managers we work with lack skill and effectiveness in this acumen. Giving proper feedback and praise (when timed and deserved) can be a powerful engagement tool. Please get good at this. Replace yearly performance appraisals with weekly, honest dialogue. 7. Invite people into your strategy and big picture planning If you have ever been part of a team photo, the first thing you look for when viewing

it is YOU. This is also true for strategic planning. If your team has not contributed to and been part of the development of your business planning process, they can quickly disconnect. Younger generations want and strive for contribution in this fashion; please get them involved. 8. Please teach financial literacy Many millennials have not been exposed to sound financial planning skills such as budgeting, credit, risk and asset/liability knowledge. If you help them create a solid financial, saving and investing mind-set, they will commit to your mentorship long term. 

Neil Thornton is partner with Trigger Strategies, a consulting firm providing expertise on effective business strategies and solutions. Neil is a guest speaker at the REIC 2013 Annual Conference in Toronto, June 5-9.

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Conference Speaker Spotlight

of progress, puts the accountability in the owner’s court. Your time is spent more in coaching and mentoring, instead of managing and chasing people down. Millennials are looking for independence in most cases.


Property Management

Property Management Plans Made Easy

GATHERING DATA Second in a series of articles by Eugene Korneluk, CPM®

When you manage with an owner supported Property Management Plan, you have a mechanism for measuring your efforts and keeping track of the bigger picture. In the complex and hectic world of property management, keeping track of the bigger picture can be challenging at times. When you manage with an owner supported Property Management Plan (PMP), you have a mechanism for measuring your efforts to ensure you are meeting the current and future needs of the owner.

managers should be working towards the owner’s strategy for the building. Through in-depth discussions with the owner, craft short and long term goals for the property. Typical questions to ask property owners are: What are your expectations for the property? What is your expected rate of return?

A viable PMP helps increase or maintain a property's value in the marketplace. If you don’t have one in place, it’s time to start developing one. Estimate 300 to 600 hours to produce a comprehensive report depending on the owner’s objectives. You can justify the additional cost of this project with the added value and significant savings the owner will derive from having the job done right the first time by a Certified Property Manager (CPM®).

Assembling Your PMP Team For a property management plan to really work, it needs to be developed as a result of input from as many management areas of the asset. Your team should include experts with: technical knowledge of building systems and components, operational knowledge of the subject asset, knowledge of the interests and concerns of the building's occupants, and financial analysis and the evaluation of options as well as a good strategic perspective concerning the owner’s portfolio.

The initial process of creating a property management plan involves three steps: 1. Creating a vision and mission statement for the property 2. Assembling your PMP team 3. Assembling current portfolio data Creating a Mission Statement We may have our own vision for the real estate we manage; however, property 8

REIC Exchange, May 2013

Assembling Current Portfolio Data The property management plan should be a source document of vital building information, comprehensive reports and a variety of test results. However, two key reports are needed to start forming the foundation for your property management

plan: A Building Condition Report (BCR) and a Building Appraisal for market value purposes. Your building’s condition will impact directly on the property’s strength in maximizing value for the owner. Building Condition Report The Building Condition Report should be commissioned first. Separate the capital and repair activities by definition. Repairs pertain to regular maintenance and code related activities. Capital work is based on replacement and/or improvements to building components. If additional studies are required to inspect for unknown conditions, these studies need to be listed in the timelines for project work. Cost estimates should be marked up to include profit and project costs that may add 2030 per cent to the value of the project or activity. Look for results from recent or past tests or studies performed on the building. Any Phase 2 engineering studies on problem building components are important clues on additional expenditures required to rectify the issues. Building Appraisal Report A Building Appraisal Report should be commissioned next to estimate the current market value of the subject property


Request the narrative approach (a full narrative or short narrative report) following the guidelines of the Uniform Standards of Professional Appraisal Practice (Canadian USPAP), or references to the U.S. Uniform Standards of Professional Appraisal Practice (USPAP). Other international standards of appraisal include the Red Book of Royal Institution of Chartered Surveyors (RICS). The "Purpose" and "Function or Intended Use" of the appraisal must be defined for use with the PMP study. Typical appraisal reports are prepared with Cost Approach, Income Approach and Direct Comparison Approach to Value taken into consideration. When available, comparable properties of similar size and effective age need to be analyzed against the subject property, focusing on their physical and income generating characteristics. A Highest and Best Use Analysis is an important part of the valuation analysis which may suggest an alternative use of the property that gives the owners a higher potential investment return. Environmental Assessment Report Another report that may need to be commissioned early in your information gathering stage is an environmental assessment of the subject building. Environmental audits focus on the sustainability of the facility relative to recent environmental codes and regulations. If hazards are present in facilities such as asbestos or lead, you need to understand how the hazards are managed to remain compliant with legislation. Functionality Assessment Report Commissioning a Functionality Assessment Report would help measure a facility’s ability to adapt to occupants and accommodation needs. This report will provide valuable information to an owner about timing of recapitalization investment to keep your occupants satisfied with their building space utilization. Your appraisal report may have additional information on

comparable buildings with special features designed for occupants. Does your subject building have the capability to expand or adapt to meet changing requirements of your occupants? Is the facility limited by its age and design? Can you support an occupant who wants to optimize their space to changing economic conditions? For example within governments, reorganizations may be as high as 15-30 percent every few years depending on government legislation, program changes and agendas affecting delivery of program services to the public. All these additional studies play a part in the decision making process for building viability. Gathering Historical Data At this point, you should consolidate other sources of information for your property management report. You can obtain financial information from the finance department of the management company for the property. Ask for a detailed line object breakdown of the operating expenses for the facility. The last 2-5 years of expenses will provide adequate information useful in trend analysis. A current rent roll, rents

With all the information gathered on the properties, you can start work on your PMP with vigour! receivable, and any 3rd party revenue sources need to be requested. You should also get a list of tenant inducements that may be outstanding for occupants. Some tenant service work could be timed along with other base building capital or repair upgrades that may be incorporated at the same time. Track the progress of your property management report achieved over the project period gathering any key information that may be useful in the future. Utility consumption data over the past 5-10 years needs to be analyzed for trends. All contracts for the subject building

Property Management

based on a “fee simple” basis, free of environmental contamination.

require reviews to ensure proper care of the facility is being maintained. Look for gaps in service work that may have been differed or neglected. Arrange for a visit to the subject building to maximize effective use of the building operator, and tenant time. A building tour of the entire building could be arranged for both BCR and Appraiser at the same time. Note the state of up-keep in mechanical/electrical rooms. This gives you a clue as to the building status of repairs/improvements. Scheduled visitations with specific tenants would provide an opportunity to understand the functionality of the facility and how the building relates with the occupants’ needs. Take some time and ask some questions of people in the building. Why do they like the building? What are the amenities? What keeps them in this building? What would they improve in the building if possible? Take note of the building’s features setting this subject building apart from others. Check-out the sales/management offices to gather additional information on the facility and the neighbourhood. Walk the surrounding neighbourhood to obtain a perspective on how the subject building adds to the community. What makes this facility stand-out from others? Walk through comparable buildings in the neighbourhood and view yourself as a prospective tenant deciding on new space for your business service, residence or endeavour. Looking back at the pile of reports and realms of data you have just gathered, you may have missed asking for an Accessibility Report or the building’s population. What about special studies such as energy audits and elevator reports? With all the information gathered on the properties, you can start work on your PMP with vigour! The next article will focus on writing your PMP to create maximum impact for your owner or investor group.  www.reic.ca

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Chapter Updates

Real Estate Institute of Saskatchewan (REIS) REIS ran FIN 402: Investment Real Estate - Financial Tools course in January. Although there were only five students, the Chapter felt it was important to give members the opportunity to fulfill their course requirements without having to travel outside the province. The Chapter exhibited at the Association of Saskatchewan Realtors Annual Symposium to promote the FRI designation. The Chapter made several key corporate outreach contacts, including a large commercial brokerage in Regina. At their Annual General Meeting members were briefed on Chapter activities, the new REIC Strategic Plan and the proposed changes to the REIC By-laws. 

REIC/IREM Edmonton Chapters

IREM BC Chapter IREM BC once again achieved Five Star Status from IREM for their commitment to membership growth and services and sector promotion. The Chapter participated in BUILDEX Vancouver in February. In addition to the regular course and designation information material, the Chapter distributed buttons promoting property management as the second happiest profession (according to a 2012 survey by CareerBliss)!

 (L-R) Earl Pottage FRI, CRES and Lindsay Carlson FRI, CRES

Members, sponsors and guests enjoyed an informative presentation on the Basics of Equipment Breakdown Insurance by Harvey Kenworthy at the Chapter’s spring luncheon in March. The Chapter held another successful Bed Bugs and Beyond Workshop in April. 

The Edmonton Chapters celebrated 2012 milestone members at a Chapter lunch in February. Chapter Past President Lindsay Carlson, FRI, CRES recognized Earl Pottage FRI CRES for 45 years of membership! Earl and Lindsay appeared on the cover of the Edmonton Real Estate Weekly. The Chapters asked members to vote on a merger of the IREM and REIC Edmonton Chapters. A successful vote, which has just been approved, will help maximize resources and improve services to all members. 

Toronto Chapter The Toronto Chapter hosted two informative building tours this year as part of its mandate to provide continuing education to its members. In February, the tour focused on a retrofit building that showcased modernization approaches that also reduce environmental impacts. In April the tour showcased a Next Generation Living home that uses design and construction materials to optimize energy efficiency and comfort. The Chapter also ran a successful seminar on improving indoor air quality. The Chapter wrapped up a year of 50th anniversary celebrations with a fun social on the 51st floor of the Manulife Center in Toronto. 

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REIC Exchange, May 2013


Member Profile

in their community, support charities, take self-improvement courses and try to make a difference in their own and others lives. I love the variety and pace of my job and the fact that it is a lifestyle job, not just a career. I love developing and refining my leadership skills with such a diverse groups of members. Q. What motivated you to get into real estate? A. Early in my career I developed a true passion for real estate. I felt that opportunities existed in this field that no other field could offer. I thoroughly enjoy working with people and providing objective guidance in what usually is their biggest investment. As I became more and more familiar with the real estate industry, it was made evident to me that there was plenty of room and a definite need for quality leadership and professionalism.

Member Profile GARETH R. JONES, CRES Gareth R. Jones, CRES is the Branch Manager/Broker with RIGHT AT HOME REALTY INC., Brokerage in Toronto. Q. What do you do? A. Along with my management team and amazing support staff, I oversee the branch operations and almost 1,200 real estate practitioners. We maintain the status of being the number one office in Toronto based on units sold for the past three years in a row. Q. What do like about your job or your line of business? A. The most enjoyable part of my position is in knowing that I play an integral part in the growth and development of a very successful team. Improving the skills set, education level and expertise amongst our agents is paramount in my mandate. I am always encouraging my team to embrace their passions, to get involved

Q. Did you face any professional hurdles and how did you overcome them? A. One of the most obvious hurdles that most professionals encounter is trying to “differentiate themselves from the crowd.” The real estate business attracts and lures in thousands of new registrants every year, many do not survive. In order to be successful in the long term, you must find a way to differentiate yourself, be relevant, knowledgeable and continue evolving. Real estate sales is all about building relationships, incorporating unquestioned trust, knowledge, integrity and honest communication with your clients. Priorities seem to be even more misaligned today and favour short term thinking and not longevity or sustainability. Our “Professionals” are reluctant to spend money on programs designed to help them succeed and instill value and faith in our consumers. We need to continue to communicate our value proposition to the public. Q. What are the benefits of being an REIC member for you? A. As a member of REIC, the improvement to my skills is immediately apparent after taking the courses. The course content is always current, valuable, well presented and focused on today’s industry climate. There is also an outstanding opportunity to network with the cream of the crop, the best of the best within our trade. Everyone that I have had the pleasure of meeting so far, who are associated with REIC, are outstanding individuals who take their business very seriously and are willing to share their ideas and wealth of knowledge. At the REIC designation level of membership and involvement, the playing field is not competitive, it is cooperative. If you want to stand out and be respected within our industry, put some letters behind your name, in my case – CRES and FRI (soon to be). Q. What’s your favourite past-time or hobby? A. In the past, my hobbies have included tennis, golf and soccer. Recently I have developed a keen interest in boating.

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THANKS TO OUR 2013 CONFERENCE SPONSORS! REIC gratefully acknowledges the following companies.

PLATINUM First Condo Group Future Solar Developments Inc.

2013 ANNUAL CONFERENCE AND AGM June 5 - June 9, 2013 Fairmont Royal York Toronto, ON

gold Real Estate Institute of Manitoba

silver Arcturus Realty Boardwalk Rental Communities Bee-Clean Building Maintenance Colliers International Right At Home Realty Inc. Toronto Real Estate Board Tridel

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AWARDS DINNER WINE Specialized Property Evaluation Control Services Limited

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