Anthora rarely recommends a full property rebranding and never before sorting out the operational and financial challenges of the property.
- Rebranding before change tends to be an empty gesture; all you're selling is a new name.
- Rebranding after change is generally unnecessary as improved operations and appearance provide the market signal that "rebrands" the property through better word of mouth.
- Most distressed properties can ill afford the $20-50,000 in new signage, stationery, website redesign, and advertising sufficient to erase the reputation of the prior name.
Nevertheless, this property in the Spanish Lake submarket of St. Louis suffered from a multitude of challenges such as high crime (40%+ of the precinct's crime total for prior three years), occupancy of 65%, moderate physical decline, and poor procedures that evolved from lack of cash flow.
After a thorough series of inspections, Anthora made the following changes:
- Improved signage and entry appearance
- Revamped the confusing 2-entry leasing office layout
- Reinvigorated the oversized clubhouse with a business center, fitness center, and "community cafe" with free wireless
- Provided clear expectations and guidelines for better communication between the leasing office at the front of the property and the property manager's office in the middle of the property
- Installed 60+ street lights and 50+ high definition cameras
- Created new relationships between houses of worship, non-profits, and the community to provide free meals and off-site camps during the summer
- Directed property management on the reinvigoration of their relationship with the local housing authority, increasing the number of qualified Section 8 voucher recipients, primarily the value-sensitive recipients who contribute toward their rent
These steps required 10 months of intensive management with multiple site visits. Years of inattention led to a shell-shocked site team that managed everything in-house, but was stretched too thin to effectively attract new prospects to the property. The installation of cameras and lights led to an immediate uptick in new prospective traffic as improved safety and site team visibility led to resident referrals. It also allowed the site team to see that real, sustained investment in the property could achieve results.
With the site team supporting the reinvigoration plan, subsequent steps focused on improving the resident base. Aggressive eviction of residents for non-payment or criminal activity resulted in the turnover of 50% of residents. By providing free summer camp opportunities for children at the property, Anthora secured lease renewals from many desirable residents. At the end of 10 months, occupancy rebounded to 70% and delinquency declined to 2%. The share of housing voucher recipients, an important demographic in this submarket, increased as resident satisfaction and local housing authority authority relationships improved. With the recovery underway, a rebranding was executed, providing a more place-specific identity.