Renewal strategies primarily focus on the administrative side of the renewal process. While sending out notices regarding lease expirations and rent changes is a legal requirement, it’s not exactly something we would characterize as a strategy around renewals. The level of engagement a resident has within the community and with the site team has a direct correlation to the likelihood of them renewing their lease.
As you are budgeting for 2025, consider the current strategies you have for renewals. What happens when you go beyond these basics? Executives Antoinette Williams, VP of Luma Residential, and ReyAnne Schmidt, Area VP of Strategic Properties, share their insights on resident satisfaction to optimize renewal rates.
Antoinette Williams: We know that the renewal process begins the day a resident moves in. But so many teams forget that we have a responsibility to serve our residents throughout the resident lifecycle and even beyond.
We encourage our teams to consistently build a rapport with each resident through focused resident events and periodic check-ins. Our residents should not only hear from us on move-in day or when rent is late. Our residents should feel like we are here to serve them at month 2, month 9, month 27 and all the months between.
We implemented random resident surveys, so that we can get periodic, yet transparent feedback from our residents. When we receive the surveys, we really try to assess how we can improve the practices we have in place that really resonate with our residents, so that we can build on our success.
ReyAnne Schmidt: The big thing is engaging them before their renewal, specifically before you send out the renewal notice. We all know that the old saying is that they have made up their mind on renewing based on how their move in was handled… this is so true.
But it also has weight on the timing of when we contact them. If we only check on them when their renewal notice goes out, especially if we are increasing rent, they do not feel the sincerity of our call or checking in.
Many of our properties are going through small renovations and part of our renewal program is to see if they would like to transfer to a renovated unit vs. renewing in the classic unit. Sometimes it just the offer they appreciate. Some of the standard items that we do are:
AW: While we’ve largely been very fortunate in our portfolio, averaging more than 65% retention across our portfolio, one of the challenges has been maximizing our rent growth potential in a downward market.
Many of the price optimization systems have been recommending rate decreases due to the market shift. However, we have been very prescriptive around our renewal letters to ensure that we are maximizing every opportunity. For this reason, we have seen over 3% rent growth in a soft market.
The strategy has been built around our people. Our teams remain understanding of our processes and get to know their residents really well. I’m so grateful for the tenure of many of our associates here at LUMA Residential. The average tenure of our Service Managers is over 9 years and property managers, 4.5 years. That's a real edge that we can be proud of.
Ensuring that our teams have everything they need to be successful and constantly keeping in mind the ways in which we can elevate the quality of life for our employees has been the strategy for keeping employees engaged and connected for the duration of LUMA’s 40-year history.
RS: One of the largest challenges that we are being faced with, is that there was such an increase in rent for a year that now has slowed. This meant, to stay competitive, considering the reducing of rents instead of increasing. We are finding ourselves doing larger than normal “stay” discounts as well as some cases of rent reduction.
One other way we are trying to compete and stand out is looking for value-adds in the home that can become part of the property permanently and yet make the resident feel upgraded and special. Things like a Ring camera, new ceiling fans, appliances, and sometimes even flooring.
Our strongest competitive edge is our communication. With all of the AI in our hands now, overcommunication is a great thing. But sometimes, it’s just the friendly call from the actual manager saying, “How are things?” I think it’s personal time that makes the difference.
AW: This is definitely a balancing act. Right now, lease trade-outs take a back seat to resident retention. Resident satisfaction has always been a focus, but it is especially crucial right now. Rent optimization is the key and it is relative to the market and the specific asset. At some properties, rent optimization may not equate to rent growth, but the key is ensuring that we are continuing to do what we can to maximize revenue and add value for our investors.
RS: This is a tricky one. Resident satisfaction is where you have to start. Unhappy residents will make everything you do terrible – rent can be the same and they will be unhappy; rent could be lower and they will still be unhappy. You have to start with what is important to them by putting value into the home they are paying rent for.
Consistency and follow-through are the key factors. Residents want to know they are important to you but they also want to know that you will actually do what you say you’re going to do. Things like doing your inspections, completing work orders in a timely manner and hosting a variety of resident activities will show your residents what makes you different.
AW: While centralization has been a hot topic over the past few years, many companies have approached it as a resolution for overcoming issues with our labor force. We started centralizing various aspects of our business over 30 years ago in order to better serve all of our stakeholders and before it was ever a regular topic in the industry.
What we are doing now is just the most current iteration of what we have always done. We are focused on lifting as many administrative tasks off our on-site teams as possible so that they can focus on building rapport and better understanding of the needs of our residents. This is how we can retain them.
We want our customer-facing people to do all the people things better than anyone in the industry, so we give them the space and time to do that by using technology wherever it makes sense. We also have other centralized teams who specialize in various off-site administrative tasks.
RS: I don’t think you have to do “out-of-the-box”. I think we try to be so “out-of-the-box”, we forget to just do what is tried and tested. A handwritten thank-you letter, an actual phone call and leave a voicemail message. Balloons on the door for a birthday. Doing resident mix-and-mingles is an oldie but a goodie. Residents spend so much time at work and in their apartment, its great to host things outside to just get them to know their neighbors.
About Antoinette Williams: Antoinette Williams is Vice President of Operations for LUMA Residential, with 17 years of Real Estate Property Management experience and over 20 years of Operations Leadership experience. Prior to joining LUMA, Antoinette held pivotal roles like Regional Vice President at CARROLL and worked with other industry-leading companies like Essex Property Trust and The Related Group, all of which contributed to developing her strong background in value-add, core and core-plus investment management.
Antoinette received the 2023 DEI Champion Award from Globe St., showcasing her commitment to diversity and inclusion and served as the Executive Sponsor of the DE&I Council at CARROLL from 2020 to 2023, where she actively promoted an inclusive culture.
Antoinette holds her Certified Apartment Manager and Certified Apartment Portfolio Supervisor certifications through the National Apartment Association, is a graduate of the National Apartment Association Leadership Lyceum in 2022 and is currently pursuing the Texas Apartment Association Leadership Lyceum, set to graduate in 2024.
About ReyAnne Schmidt: ReyAnne Schmidt is a seasoned professional with over 25 years of remarkable experience in multifamily housing. As the Area Vice President for Strategic Properties, she possesses a wealth of knowledge in various facets of the industry, including new construction, lease-ups, stabilization, and affordable housing initiatives. ReyAnne's expertise extends beyond the operational sphere, encompassing neighborhood engagement, resident retention strategies, economic and physical occupancy growth, and expense control optimization.
With a track record of exceptional accomplishments, ReyAnne stands out for her keen insights into financial planning, driving revenue growth, and creating enduring relationships with her team, clients, and business partners. Her dedication to fostering these relationships has been a cornerstone of her successful career, with an ability to collaborate and form connections that elevate her projects and initiatives.
ReyAnne's commitment to professional and personal growth is evident in her continuous pursuit of industry excellence. She not only brings a vast reservoir of experience but also a deep desire to stay attuned to the evolving trends and dynamics of the field. Her dedication to staying ahead of the curve is reflected in her adeptness at software management, operational optimization, troubleshooting, and the seamless integration of new software products.
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