09/01/2013
RENEWAL AND NOTICE TO VACATE PROCESS
Renewals
September 1, 2013
The goal of the Benchmark Management Renewal Program is to minimize the high cost of resident turnover on the communities and to ensure the renewal process is enjoyable and beneficial to the current resident(s). This responsibility and the accountability of the program is that of the Community Manager, Assistant Manager and the Leasing Consultants, when applicable.
THE RESIDENT RENEWAL PROGRAM STARTS WHEN THE NEW RESIDENT(S) MOVES INTO YOUR COMMUNITY.
Renewal Program
The retention program is a systematic and organized approach to increasing contact with each resident at the community. With regularly scheduled contact with the residents, the chance that a resident could quietly live through his/her lease term (and perhaps be dissatisfied) without ever hearing from the team members is significantly reduced. The program will help team members build valuable relationships with the residents throughout the term of their Apartment Lease Contracts.
The following outlines the renewal program. This program includes the instructions for specific renewal items and guidelines/suggestions for informal methods of securing renewals.
· The renewal management goal is to have a minimum of 80% of the lease expirations in a given month decided 45 days before the lease expires. “Decided” indicates the resident(s) has notified Management in writing of their intent to vacate, signed a new Apartment Lease Contract, or already moved out.
· In order to reach our goal, all team members should strive to complete all lease renewals or gather all intent to vacate forms prior to 45 days from lease end.
- Example: The lease expires on September 15. The resident(s) must inform Management of their intent to renew or give notice no later than August 1. If the resident(s) does not inform Management of their intent, their lease will be extended on a month-to-month basis. The resident(s) may choose to vacate the apartment on October 15, but the notice must be in writing and in the system 45 days prior to their requested move out date. The notice must be entered into the computer the day it is received.
Community Strategic Renewal Program
The Community Strategic Renewal Program will incorporate both OneSite and a Renewal Spreadsheet to ensure that all lease expirations are contacted frequently with records kept of that contact and of the resident’s decision about their pending lease expiration. OneSite will track the resident(s) contact as outlined in the Renewal Timeline program on the following pages.
Renewal Spreadsheet
The Renewal Spreadsheet (Exhibit F-1) serves as a request for approval of proposed renewal rates from the Regional Manager. The spreadsheet and process should allow for informed discussion to provide the best renewal pricing possible.
The Renewal Spreadsheet in Excel contains 13 tabs – a blank and one for each month of the year. There should only be one Excel file for a calendar year. If analyzing renewals for leases expiring in October, use the October tab, etc.
Definition of columns (alpha reference to Process on following page):
· Unit Types – Currently broken down by floor plan and floor location. This column can be expanded to as much detail as is needed.
· Currently Vacant Not Leased (a) – Any vacant units not already leased.
· Currently on Notice Not Leased (a) – Any NTV which has not been preleased.
· Undecided Columns (b) – The number of lease expirations for the three months preceding the month being analyzed who are still undecided (have not renewed or given notice).
· Non-Renewal Rate (c) – Trailing percentage of expirees not renewing.
· Total Renewal Exposure – Formula. Total projected number of unknowns that will become available.
· Prospects by Floor Plan (d) – Number of prospects by floor plan.
· Net Leases by Floor Plan (d) – Number of leases by floor plan.
· Total Exposure – Formula. Vacant Not Leased + Notices Not Leased + Total Non-Renewal Exposure.
· “Month” Expires (b) – Drop in number of Lease Expirations by Floor Plan for month being analyzed.
· Proposed Commodity Pricing –
- Apt. No. – apartments expiring by floor plan (b)
- Current Rent/Concession – from rent roll (e)
- Market Rent – current market rent (e)
- Proposed Rent/Concession
- Current Garage Rent/Market Garage Rent (e)
- Proposed Garage Rent/Concession by xx/xx
- Proposed Garage Rent/Concession after xx/xx
- Water (if applicable) Old/New
- Cable (if applicable) Old/New
- Trash (if applicable) Old/New
- Pest (if applicable) Old/New
- Preferred Employer Discount - % or $
- Confirm Preferred Employer – To confirm review of current paystub
- Ledger Checked Current – To confirm resident is current with all charges prior to offering renewal
- Pre-Inspection Done – Document that we inspected
- File Review Violations – To ensure we have reviewed resident’s history and that we wish to continue that residency
- Confirm Leaseholders – To ensure there has been no change in occupant make-up and the proper individuals are executing a new lease.
Process: Gather the following reports:
a. Current Availability Report
b. Current Renewal Status: Enter 180 in Select Expiration Date, select All for Renewal Status
c. Renewal Trend Report for current year obtained from X drive
d. Leasing Activity Summary: Typically last 3 months (may need to look at prior year activity when doing January – March)
e. Current Rent Roll.
Directions for columns:
1. Vacant Not Leased – Input number of units from Availability Report by floor plan (a).
2. On Notice Leased – Input number of units on Notice Not Leased from Availability Report by floor plan (a).
3. Input Undecideds for next three months using current Renewal Status (b).
4. Input Non-Renewal Rate from Renewal Trend Report (c) – Input your YTD renewal rate from the Renewal Trend Report Annual Average as provided on the X drive. This should be entered as “1 – renewal rate = non-renewing rate; i.e. if renewal rate is 55% than this would be 1 - .55 = .45.
5. Input Prospects (d) – Obtain from “Leasing Activity Summary” January 1 – Current Date; parameters: Activities – all. Refer to “Summary by Floor Plan Group”, “New Prospects”, first column.
6. Net Leases by Floor Plan from Leasing Activity Summary (d) – Obtain from “Leasing Activity Summary” January 1 – Current Date; parameters: Activities – all. Refer to “Summary by Floor Plan Group”, “Net Leases”, column 14.
7. “Month” Expires: Input from Current Renewal Status (b).
8. Apt. No. – Input from Current Renewal Status (b) – Each apartment expiring in month being analyzed.
9. Current Rent/Concession, Market Rent, Garage Rent/Market: Input from Rent Roll (e).
10. Proposed Rent Concession – Based on review of Total Exposure, traffic patterns, etc. Drop in your proposed rent/concession for Regional Manager review.
11. Proposed Garage Rent/Concession – Proposed amount for Regional Manager review by xx/xx.
12. Water Old/New – example: 20/20.
13. Cable Old/New – example: 35/35.
14. Trash Old/New – example: 0/5.
15. Pest Old/New – example: 0/2.
16. Preferred Employer Discount – Input % or flat rate if applicable.
17. Confirm Preferred Employer – If resident is receiving discount, place “x” in column once you have viewed paystub confirming eligibility.
18. Ledger Checked Current – Review each resident’s ledger to ensure they are current prior to sending them an offer to renew. In the event they are delinquent, you will need to contact them to bring their account current before you can provide a renewal offer. Add note in comment line.
19. Pre-Inspection Done – Add an “xx/xx” to this column when you have completed the inspection. If anything came out of inspection that would affect renewal, add to comment column. For example, “7 day notice given for housekeeping. Re-inspect prior to offering a renewal” or “appears additional occupant. Contact Leaseholder”.
20. File Review Violations – Review each file (paper or OneSite depending on where you track lease violations) and ensure these are residents we want to remain on property. If decision is to non-renew, add brief summary in comment column.
21. Confirm Leaseholders – Ensure there have been no changes in occupant make-up. Ensure photo ID checked when executing new Apartment Lease Contract.
22. Comment – Specific to unit-example: fireplace, etc. Do not re-write information already in columns.
General Items on bottom of spreadsheet is to note items that are applicable to all units; for example, renewal incentives. Unit specific items should be listed in the Comment column.
Renewal Incentives
To show appreciation for the resident’s patronage, several reasonable renewal incentives might be offered. Here are a few commonly offered ideas:
· Carpet cleaning
· Accent wall painted
· Updated lighting
· Ceiling fan
Complete all information and then notify Regional Manager that spreadsheet is ready for review and approval.
Renewal – Working Spreadsheet Tab
1. Once the Renewal Spreadsheet is approved by the Regional Manager, a working tab will be created and the approved spreadsheet will be locked and no longer can be edited. A copy of the spreadsheet will be placed in the appropriate month.
2. The Community should develop a color scheme with different colored highlights to be used on the working tab (yellow=renew, pink=notice to vacate, blue or green=month to month).
3. These highlights designate when a resident has given notice of their intent to vacate, renewed their lease or decided to go on month-to-month lease.
Renewal Timeline
Within 45 days of Move-In: Move-In Survey. New move-in survey is sent from the corporate office via email or postal mail to determine the new resident’s satisfaction with their move-in experience.
90 Days After Move In: Service Survey (Exhibit F-2) and Cover Letter (Exhibit F-3). We will solicit service requests from the new resident(s) so we may fix anything that needs repair. A reminder to perform this task will automatically be generated in OneSite and will appear in the Resident Retention box on the Community Today Page (See Exhibit F-4 for instructions to add the Resident Retention Box to the Community Today Page).
180 Days After Move In: Personal Call or Visit. The Community Manager will reach out to the resident(s) with either a personal telephone call or visit to ensure the resident is happy during their residency. A reminder to perform this task will automatically be generated in OneSite and will appear in the Resident Retention Box on the Community Today Page (See Exhibit F-4 for instructions to add the Resident Retention Box to the Community Today Page).
240 Days After Move In: Apartment Inspection. Apartments will be inspected by an office team member and a service team member for the following:
· Repairs – Note and/or make any necessary repairs in the apartment.
· Housekeeping – Note any resident(s) that should not be renewed based on poor housekeeping.
· Asset Preservation – Note any items that can be replaced according to the community asset preservation budget as renewal incentives.
· Pre-Plan Turns – Make any notes about turning the apartment should the resident(s) choose to move out (noting that cabinets need to be ordered, etc.).
A reminder to perform this task will automatically be generated in OneSite and will appear in the Resident Retention Box on the Community Today Page. (See Exhibit F-4 for instructions to add the Resident Retention Box to the Community Today Page). This inspection is referenced on the Renewal Spreadsheet and must be completed prior to submitting the report to your Regional Manager.
75 - 45 Days Prior to Lease Expiration: “Renewal Offer” A letter to the resident(s) about their upcoming renewal is generated in Microsoft Word and sent to the resident(s). Several wording options are available based on the renewal options being offered. These letters follow Benchmark’s standard format and the renewal offer listed is time sensitive. Customized templates have been created for each community and they can be found on the X drive. Once renewal letters are utilized for your community, the completed letters will be saved on the community P drive in the appropriately labeled folder based on lease expiration date.
The timing of the distribution of these letters will be determined when the renewal spreadsheet is approved by your Regional Manager. Personal contact should be made with residents while their renewal offer is pending to encourage them to sign their renewal lease. Methods of contact may include phone, email or text message, and all contact attempts should be logged in the OneSite Activity tab.
45 - 0 Days Prior to Lease Expiration: If the resident(s) has not renewed their Apartment Lease Contract or given their intent to vacate, personal contact should be made with the resident via phone, email or text message. Ensure resident is aware of all charges including increased market rent and month-to-month fees at expiration. Contact attempts should follow on a regular basis until a renewal lease is signed or intent to vacate is given.
· The only letters utilized should be generated from Benchmark Standard Templates.
· Any flyers created to accompany renewal letters must be approved by Regional Manager and Director of Sales and Marketing.
· All letters and flyers should be copied and placed in Resident File. Any mailings, emails, texts and/or verbal communication should be documented in OneSite Activity tab.
The Lease Renewal
All Residents wishing to continue their stay at the community for another lease term must sign a new Apartment Lease Contract and all current addenda. The new Apartment Lease Contract should be the most recently updated contract available through the integrated Blue Moon lease generation program. It is the Community Manager’s responsibility to ensure that all current addenda are signed and included in the resident’s file at renewal.
In addition, when a resident(s) comes in to sign his/her renewal, he/she is required to show photo identification to verify he/she signed the original Apartment Lease Contract. If the renewal lease is left with the resident(s) to be signed and returned later, the signature should be verified against the original lease before the Community Manager signs the Apartment Lease Contract.