Change in Ownership and Management Negatively Affects Leasing
Case study
Property overview
The focus of this case study is a class B property with a total of 600 units. The property recently underwent an ownership and management change and was consequently struggling to maintain leasing velocity. Management was understandably overwhelmed with the logistical changes and leasing had fallen to the wayside as a result. CLASS was brought in to manage and increase the leasing activity while also stabilizing the leasing process in general. Prior to the arrival of CLASS, the property was leasing at an average rate of about 3.25 leases per week with rents averaging $675/month.
Results
CLASS was able to increase the leasing velocity from 3.25 leases per week to an average of 8 per week. In two months, CLASS was able to secure 64 leases. CLASS also stabilized the leasing process which allowed management to quickly transition new systems and processes.
With vs. without CLASS (assumes absorption rate w/out CLASS remains constant)
The increase in leasing activity resulted in 38 additional leases in a span of 8 weeks.
Additional annual rent revenue generated by these move-ins = $307,800 ($25,650/month)
Cost of CLASS vs. increase in annual rent revenue
Total cost of CLASS Service = $30,470 (includes travel related fees)
Additional Rent Revenue generated by CLASS = $307,800
CLASS ROI: $307,800 – $30,470 = $277,330
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