There was a time when being able to boast an on-site fitness center afforded you a distinct competitive advantage.  Unfortunately, those days are gone.  Today, most (if not all) of your competitors have fitness centers, and some might even be better than yours.
On-site fitness centers came into vogue as a means of attracting an increasingly fitness-conscious public.  They proved their worth as residents realized the benefits of convenient on-site facilities that were comparable to those at the local gym (the keyword here being comparable), without the extra membership fees or hectic commute.  They were an “easy sell” at the start, and by and large, we’ve been selling them pretty much the same way ever since.
Meanwhile, the health club industry has continued to ride the wave of the fitness trend to its fullest extent, bringing the workout experience to higher heights.  Television commercials for even small neighborhood spas look like MTV videos, with flashing laser lights, shining chrome, supermodel aerobics instructors, and row upon row of mega-machines that look like they just beamed down from the Starship Enterprise.  What used to be comparable between our communities and the neighborhood gym isn’t so much anymore.
Among those communities who caught the clue, the race is officially on to design and offer the biggest and best fitness centers around, with more trendy accessories, and newer and more versatile equipment.  Where one or two good multi-exercise machines and mirrored wall were once sufficient, many communities are now filling their fitness centers with health club-quality equipment.  Existing fitness rooms are expanding to accommodate everything from new machines that look and feel like virtual-reality video games, to juice bars and multiple televisions.
It hasn’t escaped the notice of our future residents that fitness industry state-of-the-art is a tough standard to meet.  That’s why simply stating that you have an on-site fitness center in a brochure, on a website or over the telephone is no longer sufficient to grab their attention – even if every other community in the neighborhood doesn’t have one too, the gym down the street is a tough act to follow.  Nor is it enough to just point at the fitness center door and mention it in passing during a community tour.  If you’ve put effort into ensuring that your fitness center is worth selling, then now’s the time to sell it for all it’s worth!

“Results-Oriented” Presentations
Back when fitness centers sold themselves, Leasing Professionals didn’t have to know much about them.  Product knowledge training often goes into minute detail on each apartment home’s interior, but offers only a cursory run-through of the community’s amenities, and still doesn’t include much information about fitness centers beyond that they exist.  As a result, we know enough about ice-making frost-free refrigerators and self-cleaning ovens to spout off until a future resident leases or dies of boredom (whichever comes first).  The features and benefits of other exterior amenities are still pretty straightforward, but today’s fitness center has more to offer, and deserves to be given special attention in our presentations.  A well equipped fitness center represents a significant investment – one that an accomplished Leasing Professional should take pride in presenting as one of the best benefits of living in the community.
Not only does the investment warrant special treatment, but consumer desires also demand that fitness centers be placed in the spotlight.  Our health conscious future residents are increasingly savvy about the benefits of various types of fitness equipment, and in turn, demand more from an on-site fitness center.  This is why it’s important for Leasing Professionals to be not only aware of the value of the fitness center as a community feature, but to be well versed in the features and benefits of the various types of equipment it offers.  Granted, it’s a bit much to expect all Leasing Professionals to be fitness experts too, but a little extra product knowledge can go a long way.  For example, there’s a big difference between “We have a treadmill here and a bike over there” and “Our treadmill has a variable incline” or “This bike will also monitor your heart rate”.
On-Site fitness centers may come in all sizes and in many settings, but the one thing they all have in common is that they can be used as a powerful marketing tool.  The key, as fitness centers become more commonplace, is to spotlight the features and benefits that make yours unique.
I recently came across this segment in a new fitness magazine:
“We realized that just having an on-site fitness center would not be enough,” says Pamela Hughes, President of South Hampton Property Management,  “Our goal was to have a better fitness center than the competition.” For its Monticito development, a luxury apartment complex in Houston, they installed two Textrix VR bikes – virtual reality bikes that feature interactive computer graphics and motion. “When we show our fitness center to a prospective resident, we take them straight to the VR bikes, “ says Hughes. “It really makes an impact.  They may have seen seven communities in a day, but they remember that the Monticito had something that the others did not.”
When planning a new fitness center, adding to one, or simply revamping your leasing strategy, focus on what will make your facility stand out from your competition.  Your facility’s unique selling point may be a special piece of equipment, like one of the newer VR bikes, a rock-climbing wall, or a treadmill with the latest monitoring technology.  It could also be an accessory, such as an individualized audio/video entertainment system or an aerobics area.  It could even be an intangible benefit, such as 24-hour access or a beautiful view of the pool or skyline.
No matter what you do to put your fitness center above the competition’s, you have to train your leasing professionals to sell it if you want to accentuate its differences.  Keep in mind that a unique selling point is not a replacement for having a good fitness center.  It is that special feature which will help you close the lease.
Unique Selling Point (USP) – A key marketing principle which states that to rise above the competition, you must be perceived as being in some way different from and better than the competition.
Here are a few tips to help you get the most out of you fitness center.
1.   Add some pizzazz!
Purchasing equipment is only the first step in designing your fitness center.  After functionality, appearance should be the primary goal. This means selecting visually appealing carpeting or flooring; installing mirrors to open up the room; displaying attractive and instructional (or motivational) posters; decorating with plants; prominently exhibiting your accessories; and adding as many extras as possible to distinguish your center from the competition.
2.   Talk the Talk of fitness training. Use words that those “in the know” will know.
In your brochure, ads, and presentations, make your words count!  Use hot-button terms such as “state-of-the-art,” “user-friendly,” and “results-oriented.”  Be specific about your equipment and its advantages.  The average consumer is becoming more familiar with the different types and brands of equipment available.
3.   Give your future resident a test ride.
If your community is lucky enough to have a VR Bike or other special type of equipment, strap the future resident in and let them have some fun.  If you have a great sound system, crank it up.  Make your future resident want to come back.
4.   Use the Internet
As the Internet has becomes more ingrained in our society, people are using it to gather information before physically visiting a location. This may now be your first line of contact, and is a fitting place for information about your cutting edge fitness center.  Include pictures of your fitness center on your Web site and remember to show people using the equipment in the photographs.
5.   Don’t Just Answer Questions.
When someone asks specifically about your fitness center, this is an opportunity to close the deal.  Unfortunately, the scenario usually goes like this:
Future Resident:  “Do you have a fitness center?”
Leasing Professional:  “Yes, we do.”
Future Resident:  “Does it have treadmills?”
Leasing Professional:  “Yes, it does.”
These future residents are telling you that your fitness center is an important issue to them – maybe even the deciding factor!  Take advantage of this situation by selling your fitness center and its unique features:
“Yes, we have an excellent fitness center complete with cardiovascular and strength equipment” or “Yes, as a matter of fact, we have 3 treadmills, 2 climbers and 4 bikes!”
6.   Use Incentives.
It’s easier to retain residents than it is to replace them – and you’re more likely to keep them if you can keep them using your fitness center.  How?  Give them more reasons to use it!  Many property management companies hold contests, fitness awareness classes and seminars in the center or clubhouse, or feature personal trainers during certain hours.  These “fitness-focused” programs not only encourage use, but they help create a center of activity around your fitness center, and lend a fitness-conscious character to your whole community!
7.   Be Creative.
Use your treadmills for a “Walk Across America” race, or use climbers to climb the Empire State Building.  Open the contest to your entire market area, charge a nominal entry fee, and donate the proceeds to a local charity.  Programs and events like these build camaraderie among users and generate great public relations.  Use your imagination to discover new ways to use and publicize your facility.

8. Continue Marketing.

Build value in your community by reminding residents of all the great amenities your community offers. I created the Healthy Choices series to encourage residents to use the many healthful-living amenities we offer that they don’t always use to full advantage. Residents who make it part of their everyday routine to use our valuable, fitness-enhancing amenities are likelier to not only live healthier, happier lives, but are more likely to renew!

Available here

How do you use your Fitness Center?
Your feedback and comments are welcome!  Please leave us a comment and let us know how you’re using your Fitness Center as a strong marketing and retention tool.  One more thing -- don’t forget to squeeze a short workout into your schedule this week.  There’s no better way to get to know your community’s fitness center (and the residents who use it) than to get in there and work up a sweat yourself!

Are your communities hearing from friends, coworkers and family of former residents? You should be, but it takes a powerful referral strategy to make that happen.
Imagine this likely scenario:  John Doe leased an apartment, and two years later, he purchased a home. Two months later, his brother called to find out about an apartment, and signed a lease.  Not long after, a co-worked called to find out about a 2-bedroom apartment, and signed a lease.  That co-worker has a family, and friends, and other co-workers, and so the chain continues.
The moral of this story is that the best new business comes from old business; but referrals don’t happen all by themselves.  They’re the result of a great referral strategy that’s founded on building great relationships with your residents.
Is your focus on devoting the best possible service to your residents?  Are you making meaningful contact with them, and actively managing that relationship to make sure that it stays strong and positive?
We’ve heard from thousands of successful communities who continually receive referrals because they understand that to receive the best possible benefit of bringing a new resident into your community – i.e. leasing an apartment, retaining that resident, and encouraging them to help you find even more great residents just like them – you have to not only lease an apartment.  You have to build a strong and positive relationship.  Here are a few relationship-building tips to help you fine-tune your referral strategy!
1.  Develop a plan. In order to make your relationships yield the most (and best) referrals, you’re going to need a plan.  A referral promotion is a great way to remind your residents, and even previous residents, that you’re looking for others like them.  This includes regular reminders to not only your residents, but also to previous residents.
Action:  We’ve heard from communities who say they’ve received the best referral results by posting and distributing quarterly reminders to their residents, local employers, relocation companies, locators, and human resource departments; and sending bi-annual cards or postcards to previous residents.  It doesn’t have to take more than an hour or so per month, but make certain that your plan includes emails, phone calls and handwritten notes.  There’s no substitute for the personal touch.
2.  Be a Resource. The most successful communities implement this ideal across the board, whether they’re serving someone who just called in a phone inquiry, or a long-time resident.  It’s also one of the most impressive ways to set your community apart from the crowd.  Know all about your neighborhood so that you’re armed and ready to provide the absolute best, on-the-spot service, information, and advice.  Toni Blake calls this the “Village” approach, because your community borders aren’t the end-all and be-all of the lifestyle that you offer.  That park around the corner, fabulous café down the block, and the farmer’s market that’s within walking distance are all part of what makes your community special enough to refer others to!
Action: You don’t necessarily need a community concierge to serve as your one-stop information source.  Providing information is a job that can be shared among your team, or it can even be the passive function of an “information directory” that sits on the coffee table in your leasing center.  Just research, gather, and keep as much information handy as you can – menus, brochures, flyers, coupons, business cards, price lists, maps, schedules, phone books, you name it – for whomever might ask.  Share this information with your residents as actively as you can, because the more they know about and use the resources around them, the happier they’ll be as a resident of your community, and the more likely they’ll be to invite others in!  Don’t be afraid to ask the other businesses in your “village” to help you spoil your residents with coupons or gifts – every new resident in your community is a new customer for them!
3. Exceed Expectations. Speaking of ways to set yourself apart from the crowd, let’s talk about how to not just make a resident happy, but blow their mind entirely.  Providing great service is fundamental to your success, but honestly, residents expect great service.  When you exceed their expectations by providing superior service or outstanding attention to detail, it makes an impact on their relationship with you that’s tough to beat.
Action: It’s surprisingly easy to do.  Just imagine the appropriate response in any situation, then go one better.  Don’t just say thanks - once in a while, send flowers.  Don’t just file the finished paperwork - call personally to follow-up.  Don’t just smile – give them a compliment and call them by name.  Residents are most inspired to tell others about you when your resident-retention efforts (especially where service is concerned) exceed their expectations in at least one of the following ways: by providing service in ways that are faster, more convenient, and possibly fun, or with some added-value benefit your competition doesn't offer. You're certain to stand out from any competition when you are the first community to provide some of these points of difference. Competitors who institute your "extras" will be copycats, playing catch-up to you. Once you have accomplished this, you can inspire residents to refer their friends and colleagues to your community. By doing so, they can gain "bragging rights" for showing others what a wonderful community they live in… YOURS!
4. Keep it up. Your relationship with resident doesn't end with the signing of a lease. It’s just beginning.  Make sure they know that you’re in it for the long haul.  You and your team are there for them, whether they have a maintenance issue or just need to know which dry cleaner can get a red wine stain out of a silk blouse.
Action: Start big on day one. Don’t underestimate the impact of pizza or sandwiches and cold sodas on moving day.  Put toilet paper in all of the bathrooms and paper towels in the kitchen.  Leave a bag of ice in the freezer or turn the icemaker on and leave a card that lets them know that it’s fresh ice.  One of our favorite tips is to place a sign in front of the closest parking space for 48-hours that reads “This space is reserved for the next 48 hours for your new neighbor”.  Make sure that the things that you do are supporting the relationship building process.  Take a close look at your move-in gifts, and if they’re not making move-in easier, or enriching the experience of living in your community, make some changes now.  Now, here’s the tough part.  Don’t wait until their next big event to make that same kind of a great impression, like when they have their first maintenance emergency or worse yet, when renewal time rolls around.  KEEP IN TOUCH!  Call within 48 hours after they have moved into their new home and ask for feedback.  Send a note after they have lived in the community for 2 weeks; contact them again with a note or by phone in three months, and then call or write again three months later.  Each note, card, or reason for calling should convey the message loud and clear that they’re appreciated, and that you care enough to make sure they’re happy living in your community.
5. Create a sense of community. Mailings and phone calls can make a positive impact on a resident, but nothing like the overall experience of being a part of your community.  The best thing about building a sense of “neighborhood” among your residents is that you don’t only have to rely on the things that are included within the confines of your community.  You have, as a rich resource, the resources, character, and offerings of your surrounding area.  Build ties between your community and the surrounding area in order to build and strengthen your presence within your marketplace.  This not only makes your residents feel like real neighbors instead of co-inhabitants; but it makes your residents, surrounding neighbors, and local business establishments more aware of your presence – and more likely to refer others!
Action: Get out there and meet, greet and get to know the businesses in your area.  Remember, more residents for you means more customers for them.  Even your competitors might be willing to work out a referral arrangement, provided it’s a mutually beneficial one.  Meet the people who make their homes in your neighborhood!  Host holiday parties and seasonal events that are open not only to residents, but to the surrounding community.  Work at least one charity event into your schedule that benefits a local organization.  Plan resident appreciation events that capitalize on your community involvement (i.e. a plant sale that includes a “Patio of the Quarter” contest).  Is it worth the time and dollar investment?  You bet!  Building great relationships doesn’t cost.  It pays… in referrals and more!
6. No matter what it is, do it right – preferably the first time. There is an old adage that we have heard time and time again “you never get a second chance to make a first impression“.  No matter what your residents need or expect, do it right.  Here’s the rule:  give your residents great reasons to refer, and never give them a reason not to!  Why are people more likely to tell others about a bad experience than a good one?  Because bad experiences make BIG impressions.  When your actions and your efforts to prove to residents that you care about them and their home make equally BIG impressions, you can bet they’ll tell their friends, relatives and associates.
Action: From the very start of the relationship building process, listen carefully.  Get the correct pronunciation of their name.  Understand their wants, needs, and concerns.  Make the move-in easier.  Keep in touch.  Fix it when it’s broken.
7. Come right out and ask. There are two schools of thought when it comes to asking for referrals.  Many people feel that it’s a good policy to never overtly ask for a referral, because it makes a resident or previous resident feel used, and nobody wants to be used.  The other school of thought feels that happy residents should be happy to contribute to your success; and that it gives them a sense of ownership to know that they have an influence over who might become their neighbor in the future.  We hold with the second school of thought.  Happy residents will be more than happy to volunteer a referral, if asked… but like all things worth doing, there’s a right way to go about it.
Action: Make it without question that your reason for keeping in touch with your residents is because you genuinely care about them. You want them to be satisfied not only because it’s in your best interest for them to stay, but truly because you want them to have a home that they’ll always be happy with.  Do that first, and do it well; and while you’re at it:  once in a while, put out a referral door hanger; mention in every newsletter that referrals are always welcome; offer a reward if the local law allows.  Make your request for referrals something that you do in addition to relationship building; not in place of it.
8.  For heaven’s sake – don’t forget to say thanks! A resident who is willing to refer others to your community is an invaluable resource, so treat them that way!  Showing appreciation is not only the appropriate thing to do when somebody helps you close a several-thousand-dollar sale, but it’s the key continuing to receive referrals. Even if you pay a referral fee, send a personal thank you note.Even if they don't lease the apartment you need to call to say thanks and let them know how the meeting with their friend, family member, or associate went.  Make a big, appreciative fuss about the wonderful thing your resident has done.  Send flowers, buy a gift certificate for lunch, or give tickets to a show or athletic event; and if you find yourself asking whether the added expense of a thank you gift is really necessary, stop to consider the lifetime value of a happy resident, not to mention one who continues to refer others! The current consumer trend is to reward your residents with a memorable event that they want to tell even more people about. An example of this would be to give them tickets to a "backstage" event. This gives your resident bragging rights about your community.

Here’s one great example of a program that you can use to improve the performance of your referral strategy!

Replace Yourself Program
Contributed by Sara Soleymani

Congratulations on the purchase of your new home!  Do you need some extra cash for closing cost or moving expense? All you have to do is refer a friend to Arlington Park to rent your apartment home.  If your friend leases your apartment home you will receive a check for $000.  It's that easy!!!

Here’s how the program works:

1.    The prospect must tell the leasing associate on their first visit that you referred them.
2.    They must lease your apartment home before you move out.
3.    You must give proper notice according to your lease.
4.    You must provide proof of purchase of you new home.
5.    You will receive your check for $000 at your new home within thirty days of your friend moving in.  Don't forget to leave your forwarding address.

See, I told you it was easy!  If you have any questions, please call the leasing office at 555-5555.

*This program expires on <Month> <Day> <Year>.

This article is being republished for Alicia and Derek.

Special Note to Alicia and Derek: When you have no availability in your one-bedroom apartments, it's time to increase the rents. One of the biggest issues I see with apartment communities across the country is that they treat community occupancy as a whole when they should be focused on apartment-type occupancy and availability. Rents on a one-bedroom can be higher than on a two-bedroom!  I have achieved this with success!

I wrote an article a while ago that addressed the issues of offering concessions.  Actually, it was more of a rant, but you can believe that I meant every single word of it.  The truth is that at the time, I was face to face with a tough decision to toss my convictions aside and offer concessions at McNeil House (the first apartment community I built, 193 units in Austin Texas), or continue receiving only three or four new leases per week, while around twenty new apartments per week were completing construction and ready to lease!

Anyone who knows me, including our long-time subscribers, can attest that “concessions” is practically an expletive in my vocabulary.  Choosing whether or not to offer them in my very own community was probably the toughest decision I’ve had to make as a developer – well, the second toughest.  The toughest was whether or not to build in the first place!

The fact that I had to approach the issue from all angles, or even approach the issue at all instead of dismissing it without a second thought, opened my eyes a quite bit to the many factors involved.  Now, don’t get me wrong – I’m still up on my same old soapbox.  Concessions are NOT the answer to your occupancy problems.  The whole reason why companies and communities offer concessions or incentives is to gain a competitive advantage, right?  So, let me ask you this… if everyone in the market is offering concessions, then where’s the advantage? It only puts us all right back where we started, on a level playing field.  We all end up giving away the farm rather than educating our prospects and residents, and playing the never-ending game of one-upsmanship that some of us have been trapped in since time immemorial. Concessions are one of those things that works well in theory, but actually creates a world of, well, concessions (I was going to use a four-letter word there, but the one I used is worse).

Hey, I understand that there’s something to be said for a level playing field, but remember when Mom used to ask, “If all of your friends jumped off of a cliff, would you do it too?” Mom was giving you some amazingly valuable marketing advice there, and you didn’t even know it.  My experience with McNeil House has given me a much clearer understanding of the facts that have to be carefully considered where the concessions issue is concerned.  If you find yourself in a similar situation, I hope you’ll take the time to consider these factors with an eye for the “big picture”.  I had to think, and rethink the issue before making my final decision, and I’ll let you in on all the factors that I considered and the steps that I took to sensibly approach the issue of offering concessions.  Next, we’ll discuss my final decision, and the results we received.  We’ll answer the important questions: Would I do it all over again?  What would I change? What did Lori (the community manager) have to say?

If your community occupancy falls below a profitable level, or you find yourself with more supply than demand, perhaps this common-sense approach will help you as much as it helped me!

Review The Overall Picture

• Meet with the entire staff, and ask for feedback from everyone on what they feel is happening.  (Actually, you should do this regularly anyway, whether you perceive a problem or not.  Some of the best and most practical insight comes from your “front line”.)
• Have your entire staff shopped along with your top three competitors. Use a third party independent company so that you’ll be able to compare the whole apartment shopping experience from your prospects’ perspective, and make adjustments if needed.
• Meet with the staff again.  Review the shopping reports together, make the necessary adjustments, and arrange for one-on-one training where it’s needed.
• Review each floor plan independently, and consider its pricing carefully.  Make any necessary adjustments to the rent based upon the floor plan’s strengths, weaknesses, and competition within the marketplace (compare your floor plans to your competitors’ similar floor plans and pricing).   In other words you need to do a side-by-side, floor plan-by-floor plan comparison of your community versus your competitors’ floor plans.  Jennifer Nevitt Casey of Bravo Strategic Marketing has created a comprehensive and widely used method for doing exactly this.  Jennifer shared her system for comparatively rating floor plans. Jennifer and I also worked together to create the ultimate evaluation tool!  NOTE: Alicia and Derek Read The Finer Points of Floor plans I am tracking this down so I can post it for you both.
• Walk all of your floor plans with a critical eye for weaknesses.  Create a training list with tips and techniques for overcoming objections and selling the strengths of each floor plan as compared to the competition.
• In existing communities, I would also take the “less desirable” locations and floor plans and determine if there is anything within budget that we could do to improve the interiors.  I’ve used this technique repeatedly with great success.
• Create / evaluate the model.  We completely upgraded our model with added crown molding, optional paint color, special plumbing fixtures, special lighting fixtures and ceiling fans, closet organizers etc.  In other words, we dressed the model up with all of the added options that were available for our residents to choose from.  This showed our prospects what they could do with the apartment home if they chose to.  We priced each option by adding only a 15% mark-up to our cost.  Five percent of the mark-up is given to the leasing professional who sells the upgrade, and the additional 10% is administrative income.  We call this our “Custom Home Apartment™.  Several companies, including ZOM Residential and Post Properties have used similar custom upgrade programs with success.
• Photograph the entry of your community and your competitors’, and compare them.  Make yours more inviting.  Look at your advertising.  How does it stack up against your competitors?  Do you sound different?  What do you offer that they don’t? KEY: Are you advertising the floor plan with the highest availability?  Are you showing both photos of your community, model and lifestyle photos, or are you showing the same thing as the competition?
• Have you tried offering an incentive (i.e. a washer/dryer, ceiling fan, upgraded fixtures, crown molding and so on).  The best incentives are stay with the community long after the resident is gone, and create added value in the long run.

Determine if you have a leasing problem or a marketing /advertising problem.

Don’t let the formulas scare you.  Once you’ve filled in the blanks, you’ll find the process to be fairly straightforward:

Objective: To reach your leasing objectives, they must be qualified in terms of numbers, time to lease up, and people.  Complete the information below to determine your objective.  Remember to be realistic.

Leasing Objectives

Number of occupied apartments desired (ex: .97 x NO. Units)               __________________

Number of apartments currently occupied                                        -_______________

Pre-leased (vacants and on-notice)                                                              -_________________

Subtotal additional apartments needed                                             =_______________

Estimate Skips                                                                                        +_______________

Current Notices                                                                                      +_______________

Estimated Canceled preleased apartments                                      -_______________

Lease expirations                                                                                  +_______________

Lease renewals expected (include residents going month to month)           -_________________

Subtotal number of new leases needed                                           =_______________

Estimated canceled and rejected leases                                           +_______________

Net Total Number New Leases Needed                                            =_______________

Traffic Needed to Reach Objectives

Leases needed ¸ closing ratio = traffic needed to reach new lease goal.

____________________ ¸ ___________________ = ____________________

* Average closing ratio including unqualified and cancels

Note:  By increasing the closing ratio, you will be able to decrease the amount of traffic necessary to meet the objectives.  This greatly saves your marketing / advertising dollars.

Rentals Per Leasing Professional Number of new leases needed per month                                                                                                             ________________

Number of leasing professionals                                                        ¸________________

Number of new leases needed per month,

per leasing professional                                                                   =_______________

Leases needed per week (¸ 4.3)                                                         =_______________

Telephone To Traffic Ratio

Total appointments kept ¸ total phone calls = Telephone to Traffic Ratio

____________________ ¸ ___________________ = ____________________

* Goal = more than 60% of all appointments kept

* Goal = 25 -50% of closing ratio

Cost Per Traffic & Cost Per Lease

A. Monthly or weekly cost of a specific media or traffic source ¸ traffic generated by _____

this source = cost per traffic

$______________ ¸ ____________ = $ ____________ Cost Per Traffic

Monthly or weekly cost of specific media or traffic source ¸ total new leases

generated by this source = cost per lease

$______________ ¸ ____________ = $ ____________ Cost Per Lease

B.  TOTAL of all Traffic Sources expenditures ¸ total traffic = average cost per traffic

$_____________ ¸ ____________ = $ ____________ Average Cost Per Traffic

TOTAL Traffic Sources expenditures ¸ total new leases = average cost per lease

$_____________ ¸ ____________ = $ ____________ Average Cost Per Lease

Do you need to increase traffic?

• Pull your last two weeks worth of guest cards, and call each and every one.  Tell the prospect that you’re conducting a third-party audit of the apartment shopping experience, and need to ask them three quick questions.  Promise that you won’t take more than a couple of minutes of their time.  The questions we ask are:1.  Have you made a decision on where you are going to move, and if so, why did you select that community?  (If they say that they’ve chosen your community, community, thank them, set an appointment for the signing of their lease if needed, and move on to the next person.) 2.  Did you visit _________ apartments (your primary competitor), and if so what did you think about the community?  Is there a specific reason why you’ve decided not to lease there?
• Invite local businesses to attend resident functions.  This increases your word-of-mouth referral network by leaps and bounds.
• Beef up your resident referral program.  If you have a referral program in place, sometimes all it takes is a well-designed flyer to remind residents of it.  If your program has grown stale, give it a fresh twist.  If you don’t have a referral program in place, get busy!  (If you’re considering offering cash rewards, make sure they’re legal in your area, but please consider that there are plenty of great alternatives to cash or rental rate rewards!)
• Make marketing calls.  I highly recommend that you not only call on the Human Resource Departments of local employers, but that you also take time to introduce yourself to the receptionist. She knows everyone in the office and everyone communicates with her on a daily basis. And these are usually the people that everyone turns to for information when they’re new to the company.  Establish a long-term program that keeps you in touch with these valuable people.  Once a month, deliver donuts, cookies, candy, flowers or some other small gift to the receptionist that she/he may share with the rest of the employees.  Include a friendly note with a few business cards enclosed for them to pass along.

Increase Closing Ratios!

• Provide continuous motivation for Leasing Professionals to stay focused on the goal (i.e. charts, graphs and incentives placed where all can see).Extend office hours and raise bonus amounts for leases closed during a specific timeframe.
• Establish a rotating bonus plan based upon leasing certain apartment types.  For example, “All A-1’s leased this week are bonused at $100!”  I typically select the apartments that have either been vacant the longest or have the highest availability. Establish team goals with bonus incentives.  Any opportunity to foster teamwork is too valuable to pass up!
• Bring in your company’s very best leasing professionals to obtain their perspective. Have everyone shopped, and review the shopping reports carefully to apply training where needed.
• Provide weekly articles of interest that focus on overcoming concession objections and closing.  I faxed our community a new article every Monday morning.  Keep the tone encouraging and motivational.
• Ask yourself this: If you increased the closing ratio by ___%, how much more traffic would you need to reach the desired goal?  Is this possible?  Can you generate that much traffic? Can you handle that much traffic?  Here’s my “Feasibility” worksheet:

Traffic Increase Feasibility

Ÿ    Is the number of leases needed per month significantly higher than current performance?

Ÿ    How much more would traffic have to be increased if closing ratios remained the same to equal the needed goals?

Ÿ    Needed leases goal.  Current closing ratio _____ = _____ new amount of traffic needed less current amount of traffic _____ = _____ amount of extra traffic needed.  Is this possible?__

Ÿ    How much more would closing ratios have to increase if traffic remained the same to equal the _____ needed leases goal?____________________________________________

Ÿ    Needed leases goal _______ ¸ current traffic _______ = new closing ratio needed _____.  Is this possible?___________________________________________________________

Ÿ    What is the monthly goal per leasing professional?__________________________

Ÿ    How does this compare with current performance levels?_____________________

___ __________________________________________________________________

__ __________________________________________________________________

__ __________________________________________________________________

Ask yourself the big question.

Finally, when all is said and done, ask yourself whether it’s really necessary to give away such a valuable commodity as the opportunity to live in your community, not to mention cutting profit from your bottom line!  In light of all of the other things that you can do to increase traffic, better motivate your staff, and gain a profitable long-term advantage, should you really give in?

My answer was a resounding (brace yourself), “Yes!”   As sick as it made me, I made the decision to give concessions. I actually get chills as I sit here and write this.  Can you guess what happened next?  As a result of my decision to first consider all of the above, and then give in to concessions, leases increased -- by leaps and bounds!  The on-site staff is more aware of the competition, more motivated, and more skilled at closing than ever before!

The decision to give away rent took me five to seven months to make.  What if I had to do it all over again?  I’d follow all the same steps that I took, but I’d do it faster.  I should have made the decision to offer concessions about two months earlier than I did, based on my lease-up schedule.

What else have I learned?

1. We could never have truly known whether or not we could have leased-up without concessions if we didn’t try to avoid them in the first place;
2. The staff became a powerhouse of product knowledge!  They were more educated than ever before about our product and our competition;
3. Our competitors thought that we were crazy (actually, they thought that I was crazy, and pitied my staff), so we were easily dismissed as viable competition.  Now, because we tried it the hard way first, they realize that we’re a force to be reckoned with.  They knew that we don’t offer concessions as standard practice, and that when we do, they’d better jump!
4. If you have to give something away, ask for something in return.  Along with the free rent, we asked the resident to sign a paying lease term of either six months or one year.  In other words, their free rent period, although covered under the lease, was not included when the lease term was calculated.  For example: with one month free rent, the lease term was 13 months.  This enabled us to get full years collection of rent without increasing our operating expenses the next year.  If you don’t do this, (as you may be aware), your turnover expenses are divided into 11 months instead of 12, so the concession actually costs you more than a months’ rent. Note: Alica and Derek this is why I asked you to read Lease Renewal Strategies that Help You Manage and pay close attention to staggering leases by apartment types.
5. Cover your bases.  As even further protection, we asked the resident to sign a concession agreement, stating that if their lease is broken for any reason, the entire amount of the concession is due and payable.  Where the lease terms and conditions are met, there is no liability.
6. Sometimes it makes sense to spread the concession over the first six months of the lease.  We did not use this method, but I have heard of many companies that have used it with success.  I think it’s a great idea, where the market is receptive to it.  Because we decided to offer concessions in order to be competitive, we had to also consider that part of our competitive edge involved how and when the concession was delivered.  In our case, the market was most receptive to a one-time offer; and you’ll find this to be true in many areas where residents view the concession as a welcome means of offsetting moving expenses – but I think the six month idea is a great one if you can pull it off.
7. You really can increase rents even though you are offering concessions.  In fact, it’s probably easier to increase rent in some places, where the market is focused on the short-term benefit instead of the long-term effect. This rings especially true when you are offering the better product.  An apartment community in Dallas leased 100 plus apartments (70%) in two months by giving away 1.5 months’ rent.  Unfortunately, they didn’t increase the rents while doing it, not to mention that they weren’t under the gun because they didn’t even have the apartments out of construction yet.  Don’t miss the opportunity to raise rents when offering concessions, whenever you can do so sensibly.
8. If you are offering concessions and decreasing your rents at the same time you had better have done all of the above and make absolute certain you are handling each and every unit type and floor plan on a unit by unit basis and monitor it with every single new rental.

After all was said and done…

I know your burning questions are (1) how did the community manager feel about the entire experience, and (2) what kind of concession did we finally settle on.

Lori’s last words were “I have learned a lot!” When asked if she would do it all over again, her response was “People can’t believe that we leased all those first apartments without concessions, but I would give the concessions the next time around instead of waiting until we had vacancy loss”.

As for our decision, we first decided to offer the market standard one-month free on a one-year lease, and 2 weeks on a 6-month lease.  We quickly adjusted that to $500 on a 6-month lease and $1000.00 on a one-year lease (which is less than a half a months’ rent and a months’ rent, respectively).  We only offered concessions only on floor plans with the highest availability.  In addition, and this is key, we continue to adjust our rents upward as we leased apartments (see #7 above). We actually charge more for a one bedroom floor plan then we did for a two bedroom floor plan.

If you’re caught in the concession trap, or even considering giving in to it, please take the time to consider the HOW, WHAT, WHEN, and WHY of it all before you follow your competition over the rail of that proverbial bridge!  Depending upon your own unique situation, there is either an economically smart way for you to avoid concessions, or to offer them wisely.  I found my answer, and so can you!

Now, I know many of you are still trying to get your Thanksgiving decorations in order, but the yuletide season is close upon us. While you’re carving jack-o-lanterns and stuffing cornucopias, here are a few ideas to get your brain started before December finds you without a plan! Here’s a great list of ideas that will help you make your community a real Holiday Home!

Deck the Halls!

Start decorating for December on the day after Thanksgiving. This not only gives you plenty of time to decorate appropriately, but helps you and your staff get into the holiday mood. Break out the eggnog and put on some holiday music to really get the festivities flowing!

We all know that nothing smells like a real Christmas tree, but few things are more practical than a realistic-looking artificial one (the key word here is realistic… unless you’re going for retro kitsch, silver foil isn’t an option). A little pine-scented potpourri in a pretty bowl can supply the scent, as can a few strategically placed real pine boughs. (Note: spraying pine disinfectant on your artificial tree will not do the trick. I only say this because I actually know someone who tried.)

Here is a green idea for your residents! For those who are not LA based we need to find away to offer this to our residents this year! Christmas trees are 1) awkward to transport and 2) terribly depressing when they’re discarded in January. Los Angeles landscape architect Scott Martin founded The Living Christmas Company which gives LA residents the chance to temporarily rent a living Christmas tree and have it delivered right to their door. Unlike regular Christmas trees (around 20 million of which are felled each year in the US), living trees are transplanted, roots and all, into pots to be enjoyed over the festive period. After the holidays, Scott and his team pick up the trees, replant them and nurture them until next year! (more at http://livingchristmas.com/)

Tiered rows of poinsettias make an excellent “tree”! Have your service team assemble a stand made of progressively smaller boxes that stack on top of each other with a wide enough margin around each to place rows of potted poinsettias. Place a dowel in the center of the top box to attach a star!

Decorate your tree to complement your décor and atmosphere. You can choose a more sophisticated, coordinated set of decorations; or make it a little more "homey" with hand-made ornaments contributed by your staff and / or residents. Add plenty of brightly wrapped "presents" (empty boxes) under your tree. Use the nicest wrapping papers you can find (red, green, silver, and gold foils look great). Your local fabric or craft store should have an excellent supply of ribbons from which to choose, including wire edged varieties that can be shaped into big elaborate looking bows with little trouble.

Remember that the holiday season doesn't mean Christmas alone. Hanukah and Kwanzaa are also celebrations of the season. Decorate for and plan community events accordingly. Find out more about the holiday traditions of all your residents, especially if yours is a multicultural community. I once attended a holiday party where the host's decorations included a gorgeous Christmas tree decorated in an African theme for Kwanzaa and a lovely Menorah burning in honor of Hanukah. The guests were inspired by the decor to get to know more about each other's holiday traditions. We all learned a great deal that evening, and felt as though we had truly experienced the joy of the season.

Play holiday music in your Leasing Center, clubhouse, and even models! The staff may tire of them, but they'll really brighten the mood for your visitors.

Keep a running supply of holiday refreshments (cookies and punch or spiced cider) in the Leasing Center for visitors. A crock-pot full of warm spiced cider makes a great treat for future residents visiting on a cold day.

Lights are a must. The tiny white outdoor ones are perfect for trimming windows and shrubbery (also great for adding sparkle year round!).

Don’t forget your models! A miniature decorated Christmas tree on the coffee table or counter, a few wrapped “gifts”, and some pine or cinnamon potpourri is all it takes to add a warm holiday touch to a decorated model, or turns a vacant apartment home into a holiday mini-model! Play a little seasonal music in the background, and you’re ready to welcome your new residents home for the holidays!

Be careful not to overdo it. Simple elegance is best. Plastic figures on the roof or a puny tree can look tacky and convey a tired image. Remember that the holidays can be a stressful time of year for your residents; and are especially trying for future residents who are searching for a new home during the hectic holiday season. Your message of polished professionalism will be well received and appreciated.

Happy Holiday Activities

Host a tree-trimming party in the clubhouse, and supply all of the materials for
residents to make the ornaments!).

Hold a Christmas tree drawing. Give away a tree, complete with decorations!

Plant a live tree.

Hold a door, patio, or balcony-decorating contest. Award the winners with a special wreath on their door, and / or a holiday gift certificate.

If you community features include fireplaces, deliver firewood on December 23rd with a note offering "Warmest Holiday Wishes." If you can't afford to give firewood away, make it available for convenient purchase on-site.

Promote January and February lease renewals by sending out a stocking cut out of construction paper that reads: "Spend another year with us and we'll put something extra in your stocking! Renew your lease today!"

Hang stocking or wreath shaped party reminders on your resident's doors the day of your holiday party.

Team up with a local charity to provide a gift-wrapping service to your residents.

Clear out a storage area and offer it to parents in the community as a "Santa's Hideaway" for gifts. You may want to have residents sign a release of liability, and allow access to only select staff members.

Plan a "Twelve Days of Christmas" party count-down.

Hold a Santa's storytelling hour in the clubhouse to give parents a little free time to assemble and wrap presents!

If your area allows referral incentives, create and distribute a referral flyer that reads "Let us Give You a Christmas Present!"

Host a one-day, on-site Christmas tree sale with a local charity that sells trees.

Print holiday safety tips in your newsletter.

Plan to offer Christmas tree recycling on-site. It makes great mulch, and is a nice way to get some positive press as well!

Hold a drawing for front-row tickets to a local performance of The Nutcracker or A Christmas Carol.

Last Minute Holiday Party Themes

Toyland - A magical world of giant lollipops, candy canes, ornaments, toys and huge packages wrapped up with colorful ribbons. This fantasy theme will bring out the child in every resident.

Surfin' Santa - Tell your residents to leave their heavy coats at the door and come out to the beach! Set up a volleyball net with beach balls. Add a "Christmas" palm tree. Hang a bright sun, beach towels, sand pails and shovels with a sprinkling of Christmas decorations (pink flamingos with holiday wreaths around their necks, beach pails full of Christmas cookies, life preserver Christmas wreaths, etc.)

Reindeer Round-up - Bring the spirit of the West alive with Country and Western holiday music. Decorate with a cactus done up as a Christmas tree. Use rope around the room like garland, and serve western-style treats.

Last But Not Least – Remember to Stay in the Holiday Spirit

A warm inviting smile from your staff is the perfect crowning glory to your holiday decorating efforts. Greet everyone with a warm welcome, and ensure your faces and attitudes reflect the same joyous message that is presented by your community decor. Nobody wants to lease an apartment from The Grinch!

Don't be distracted by the Holidays to the point that you forget your number one mission: it's more important than ever that our residents and future residents receive the full benefit of our commitment to provide quality service!