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Underperforming Lease-Up, Inaccurate Metric Reporting, Undiagnosed Leasing Failures<

Intro & Summary

Client sought REV’s services for community, reporting that:

  • property was formerly stabilized above 93% occupancy before facing inventory loss due to flooding
  • onsite team delivering 2.6 leases per week over 4 months from September through December
  • rising vacancy rate of ready units with rehab project unit delivery outpacing leasing performance
  • months of unsuccessful attempts to increase leasing velocity due to onsite team’s reports of insufficient traffic

REV represented Client’s interest through 19-week onsite leasing management project to:

  • refute onsite management’s claims of insufficient traffic impacting leasing performance by nearly tripling leasing velocity in first month against -33% downturn in traffic
  • identify and remedy specific failures and friction points in existing leasing operations of contact capture, lead conversion, prospect conversion, prospect discovery, follow-up, and closing
  • increase leasing velocity to average of 242% the prior rate and increase occupancy from 63.5% to 92.5% (+29% absolute, +46% relative)
  • increase revenue in monthly rental income by +59%
  • deliver net +13% economic occupancy above physical occupancy growth, a result of increased leasing performance supporting rental rate growth per unit</p>
Location – project size

Lewisville, TX – 200-250 Units

Services
  • Leasing Management Services
  • Onsite Leasing Professional(s)
The Challenge

Highly Rated Onsite Management Team Providing Excellent Resident Services and Leasing Underproduction

Onsite management team was highly esteemed with a great reputation having managed property through years of stabilization over 93-95% occupancy. However, this strong track record was rooted in an unusually high resident retention rate due to the exceptional resident experience the management team was able to provide.

Serving as a prime example to support REV’s stance on the benefits of decoupling management and leasing, the exceptional management demonstrated significant deficiencies in their leasing behaviors. Generating an average of 2.6 leases per week from September through December, the property’s vacancy loss was accumulating when REV commenced services in January.

Client brought REV onto the property in order to drive leasing performance according to unit delivery schedule. Based off of feedback from their management team, Client presented main leasing impediments being low-traffic and high ratio of unqualified leasing traffic.

Our Solution

Follow-Up Initiatives, Prospect Probing and Prequalification

“Traffic” is one of the most common scapegoats underperforming leasing teams aim to credit for poor leasing numbers. Like in most cases, however, REV uncovered that neither traffic volume nor quality were in fact the main issues impeding leasing performance at this property.

In January, REV’s first month on property, there was a -33% downturn in traffic compared to the 3-month trailing average, yet REV was able to nearly triple leasing velocity, generating 7 leases per week, and lower cancellation and decline rates by 20%.

REV identified severe failures in the team’s processes of lead and prospect follow-up. By implementing an effective follow-up strategy, REV increased lead-to-lease conversion from under 4% to above 15%. Paired with more directed prospect probing and pre qualification tactics, REV produced client-satisfactory leasing performance by better capitalizing on lease opportunities and efficiently allocating resources to higher-probability qualified prospects.

The Results
Increased Leasing Performance
Leasing Velocity = 242% Prior
Successful Lease-Up, 19 Week
63.5% to 92.5% Occupancy
Economic Occupancy Outperform Physical Occupancy
59% Increase in Revenue

Over 19-weeks, REV was able to lease-up the property from 63.5% to 92.5% Occupancy.

By increasing leasing velocity to 242% the prior rate, REV was able to support, and at times was limited by, the unit make-ready delivery schedule.

Supported by REV leasing performance, property was able to raise rental rates throughout lease-up and achieved greater increase in economic occupancy than physical occupancy. Client achieved revenue growth of 59%, outperforming relative occupancy growth of 46% by a net +13%.

The Results