SANTA CLARA — When it comes to picking apartments, it’s no surprise that tech-worker tenants want opportunities for social networking.
But we’re not talking about business centers where they can hunker down to like and post pictures or squeeze in an extra hour of programming.
Just ask employees at Facebook, which surveyed its employees about the amenities they want in apartment living.
Turns out a venue for old-school, face-to-face socializing topped the list.
“They did not care about the fitness center; they did not care about a business center; they did not care about a swimming pool, Jacuzzi — none of that,” said Jeff Kimes, senior vice president of property management at the Irvine Company. “They wanted those common areas to hang out with their friends and grill hot dogs.”
Kimes shared these insights during a CEO panel discussion at the California Apartment Association’s Northern California Rental Housing Conference and Expo.
The 2014 CAA Connect Rental Housing Conference & Expo comes to Southern California on Aug. 27, 2014, at the Long Beach Convention Center. For attendee and exhibitor registration, click here. Early-bird registration ends Aug. 8.The panel discussion touched on several vital topics to the multifamily housing industry, from the state of the rental housing market to job forecasts to trends in apartment renovation.
The “Executive Power Lunch” served as a midday highlight to CAA Connect, Northern California’s premier multifamily housing conference. The conference and expo, held at the Santa Clara Convention Center, featured an exhibition hall with over 170 vendor booths, a stimulating slate of rental housing seminars and a VIP networking reception where attendees hammed it up at the CAA photo booth.
It’s no wonder that CAA Connect’s attendance topped 1,300, considering California’s boom in jobs, rents and apartment construction. That means more business for developers, property managers and industry partners – and intense interest among investors.
“The capital that wants to own multifamily properties in the Bay Area, particularly the San Francisco-San Jose corridor, is incredibly strong,” said Ron Granville, one of the Power Lunch panelists.
The CAA board president recalled a recent example of white-hot interest in purchasing property. In Sunnyvale, he said, an apartment building that entered the market prompted 29 offers.
“The offers ranged from the largest institutional owners in the world – going after an 84-unit building – to private investors on the local level,” said Granville, CEO at Woodmont Real Estate Services. “They were all very serious, and the price it went for was surprising to somebody who’s been in the business for a long time.”
With all the building and buying going on, it also remains important to keep existing portfolios contemporary.
Panelist Tom Scott, president of Cambridge Management Co., discussed some ways he’s kept his properties competitive over the past few years.
“We’ve been increasingly getting into doing renovations on kitchens and bathrooms, as well as some common area things,” Scott said.
Scott, also vice president of the CAA board, added that it is important to align the level of improvements with the location.
“There are certainly some markets where it might be more justified to just replace the cabinet doors and the cabinet but not replace the box or do some lesser level of fixup,” he said.
Moreover, Scott reminded the audience that remodeling kitchens and bathrooms in older buildings can also require upgrades to plubming and electric.
“In a ’60s or ’70s-era product where you could do a reasonably good kitchen and bathroom remodel for $15 or $20,000, you could double those costs in these older buildings.”
Before and after the Executive Power Lunch, CAA Connect offered seminars covering topics from retaining tenants to the eviction process to understanding the psychology of Generation Y renters.
Bed bugs ‘biggest problem’
Attorney Stephen Pahl and Michael Pierce of Prodesse Property Group tag teamed an interactive session on legal issues in the renal housing industry, such as dealing with bed bugs.
“Bed bugs are the biggest problem we’re facing these days,” said Pahl, chairman and senior partner at Pahl & McCay.
The speakers made it clear that landlords are responsible for dealing with bed bug issues. That said, they don’t always have to foot the entire extermination bill.
Pierce, president of Prodesse Property Group, posed a question to the crowd:
“If you want to be able to recoup the costs, what should you be doing?
The audience started tossing back ideas: “Inspections.” “Investigate.” “Addendum.”
That last one caught Pierce’s attention.
“An addendum!” he repeated back. “How many of you are using the CAA bed bug adendum on your rental agreements? What does it cost you?”
“It’s free,” several from the audience said.
Pahl offered some advice on handling bed bug problems. He advised treating not only the unit where bed bugs are known to exist, but the adjacent units as well.
“Those things move really well,” Pahl said.
At another legal-oriented seminar, lawyer Karen McCay reviewed fair housing laws, including how they apply to requests from disabled residents.
Sometimes, McCay said, a disabled resident might ask for modifications to a rental property that just arent’ reasonable: These boil down to an undue financial or administrative burden or a fundamental change to the nature of a property or program.
“Under the law, those are the only two reasons you can deny an accomodation in California,” said McCay, managing partner at Payl & McCay.
These questions have to be taken on a case-by-case basis, she said.
“There could be a property where installing a $10,000 roll-in shower is completely unavailable to them – they just cannot do it, they can’t afford it,” McCay said. “Another property, though, they may be able to do two or three – they have lots of cash.”
Always listen
No matter what, however, it’s important to hear out your resident.
“You have to process the request, even if you know you are never going to grant this because it’s completely unreasonable,” McCay emphasized. “The failure to engage in the interactive process, the failure to have a dialouge with the tenant about what they need and what you need to do can be a violation of the law.”
During a day packed with expert seminars, industry partner exibits and endless networking opportunities, attendees gave CAA Connect strong reviews.
Amber Cowan, a leasing specialist with First Pointe Management Group, said she tries to come to a CAA expo every year.
“CAA Connect so far is great, said Cowan, who’s belonged to CAA for her entire 15-year career in property management.
“I just got out of class that taught me about retention and how to close, so it’s bringing me all that new, vibrant information.”
Photo by Daniel Gaines Photography