Search “Property Management in [insert city]” and expect to get a dizzying number of options in Chicago alone. How do you choose? Read on to learn what you must look for in a Chicago property manager.
Property Manager Qualifications
Property managers have a very low barrier of entry into the field. To call yourself a property manager in Chicago, you don’t need any previous experience, financial security, or even written systems.
In fact, a “property manager” with solid marketing skills (and no other qualifications) can appear at the top of that search. They can make themselves look sophisticated and stable despite having zero experience, security, or processes. This means you can’t always depend on the guy that appears the most in your online searches. Instead, your journey to find a property manager here in the Chicago market must go a couple levels deeper.
First of all, whoever you reach out to should have a reasonable response time, even to basic inquiries. I understand our definitions of “reasonable” may vary, so say to agree on less than 24-hour response times. In emergencies, you want to know they’ll respond within the hour, but that expectation may not extend to routine business calls.
A total lack of responsiveness raises a huge concern, though. Many unhappy property management clients have experienced unreturned phone calls or unanswered messages. Take this as a red flag. If someone doesn’t respond quickly to you as a potential client, we bet they don’t respond quickly to current clients either. This also raises concerns on the quality of services they provide to their tenants.
Likability and Trustworthiness
Secondly, when you do talk to someone, do you like them? Make your life easier by doing business with people you genuinely like. Whoever you talk to typically acts as a representation of the company culture and again, how they’ll treat your tenants.
You have to like and trust who you work with. It takes time to earn someone’s trust, but very little time to lose it. Plus, humans can typically weed out extremely untrustworthy people or companies during their first interaction.
By no means does this article intend to bash any GC Realty & Development, LLC competitors. I’ve found plenty of likable and trustworthy property managers in the Chicago market that can provide consistent quality service. As a matter of fact, I wrote the Best Property Managers in Chicago to highlight the great ones I know.
Providing consistent and quality service separates the fly-by-night property managers from the handful of great ones in Chicagoland. That seems simple and obvious, but that consistency doesn’t happen overnight… it has to develop over time. Plus, what that looks like in practice can come in phases with a company as they grow.
We use a measurement of doors (or number or rental units) under contract to separate these phases.
Phase 1 (0-300 doors)
When a company first starts off (0-300 doors), the owner of the business can control client and resident experience firsthand. Afterall, they probably do 70% of the work.
Phase 2 (300-600 doors)
In the next phase of growth (300-600 doors), the company has to make its first handful of real hires. This also includes setting up the structure to have employees and figuring out what systems to use, then documenting them. All these business growth activities require great effort, which can take away from the investor and tenant experience.
Phase 3 (600-900 doors)
As a company gets closer to the next phase (600-900 doors), property managers often start realizing they have a problem. They may not be making any money. Their client and tenant turnover has gotten higher than the industry standard (20% for clients and 33% for residents).
At this point, they have 14-20 employees and the owner has finally figured out how to manage a team this large.
That business owner got into property management because they know how to provide service to investors and tenants. They also know how to run the day-to-day operations in their sleep. However, that same person now has to understand how to manage a group of likely 14-20 employees at this point. And those employees have to understand how to handle the day-to-day operations while delivering the same service the owner did.
Phase 4 (900+ doors)
When a company finally gets to the fourth phase (900 doors plus), they have systems in place that allow for redundancy. And the company's entire existence doesn’t get questioned when a seasoned team member leaves.
Once over the hump of 900 doors, the business should generate enough resources to invest back into the day-to-day experience for clients, tenants, and their employees.
You can see why businesses in the middle stages have a tough time focusing on you, your tenants, and your journey. The business owners don’t have that intention in their planned experience, but it happens. Growing property management companies experience painful and obvious growing pains.
Not many property management companies ever get over the 900-door threshold because of these challenges. As many business owners may know, this only scratches the surface of these challenges. I could write a book about them if I went deep!
Trust me, we experienced them at GC Realty & Development, LLC. My dedication to making sure we didn’t show cracks in the facade damn near killed my marriage.
Companies will get to 400-500 doors, then scale back with the intended plan to stay small (100-300 doors). They create a “lifestyle business” for that business owner, or sell out to a larger company in the market. Not many will go the distance and keep growing.
That lack of focus provides inconsistent results for you as the client. At times, it also means a lack of resources dedicated to running your property as smoothly as it can.
Want to learn more about what to look out for or have you had a red flag you ignored in the past when hiring a Property manager? We love to hear from you. Reach out to us by completing the form below and scheduling a call.
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