We wrote about it in The Greater Responsibility of Multifamily Investing because we see this topic hardly discussed: the importance of our residents who live in our apartment communities. Yes, we invest in multifamily for wealth creation, but we love the communities in which we invest and our other reward is knowing that we are doing right by the people who work hard and pay rent to live in our housing.
For this reason, putting residents health and safety first should not be a choice, but a requirement. Unfortunately, many operators put residents as an after thought. If you disagree, read apartment reviews on your next subject investment. There are many ethical operators and investment firms out there, and this is why it is important to vet your sponsor.
When it comes to safety, there are three things that operators should be sure to implement in the next value-add investment: lighting, security, evictions.
Lighting
Lighting is inexpensive but plays a big part in resident safety. When there is lighting, there is less potential for crime. Criminals strike where it is easiest, and there is a correlation between darkness and obscurity and crime. Not to mention, residents and future feel safer in more well-lit places.
Security
Especially when investing in Class C neighborhoods and properties where crime was a problem under previous ownership, there is a potential need for greater security. This can include a guard, cameras or a gate, depending on the situation, need and business plan. Skipping on security can be devastating for those who want to make a real turnaround on the property’s image, but most importantly, resident’s safety.
Evictions
Often, the trouble makers on the property are those who are also not paying rent, so promptly working evictions and getting them off the property is an effective way to improve the crime and resident safety. Especially when taking over multifamily assets from mom and pop owners, there may be bad debt and uncollectible rents that they may not have properly addressed, and this presents a great opportunity to improve collections and the quality of the resident.
Passive Investors
Passive investors, it is important to know your sponsor, their asset management skillsets and their commitment to the community. Safety should not be an after thought, but built into the business plan.
If you have not already, download our free Passive Investor Startup Guide and schedule your call with us to find out more about our investment strategy and criteria and if passive investing in multifamily is right for you.
Safe Investing!
RRII
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