KINGSLEY INSIGHT
>> June 2009
INSIDE THIS ISSUE
Are Tenants Still Interested in Green Building Practices in 2009?
Since 2007, Kingsley Associates' best-in-class customer satisfaction assessments have included questions focusing on green initiatives. Over this period, office tenants have provided us with some interesting insights into their attitude toward green initiatives, including the following:
- As demonstrated in the graph below, Kingsley Associates has seen an increase in office tenants' interest in green building operations.
- When searching for space, 24% of office tenants make the building's focus on green practices a "high" or "very high" priority.
- Larger tenants, with more than 50,000 sf, are significantly more likely to indicate green practices are a high priority in their space search.
Monitoring tenants' views on green practices will be especially important as corporate occupiers face recession-driven pressures. Will interest continue to grow during the rest of 2009? To what extent can building owners and managers effectively align sustainable practices with cost-saving initiatives? Only time will tell.
Working Together to Defend NOI
In challenging economic times, it is more critical than ever for property owners and their management and leasing teams to be on the same page. This is particularly the case when owners and investors employ third-party teams to operate their assets.
Kingsley Associates regularly conducts comprehensive portfolio performance scorecards to evaluate the effectiveness of the relationships between owners and operators. These programs not only gauge the client service being delivered by third-party management and leasing providers, but they also use a 360-degree feedback mechanism to provide insights into providers' perceptions of their clients.
Among the key findings of recent portfolio performance evaluations are the following nuggets of wisdom for third-party providers to consider as they serve their clients:
- The impact on the asset manager's workload is a key driver of client satisfaction with a provider team.
- Asset managers hate surprises, so being proactive in communicating with asset management personnel about property issues is another critical aspect of client service.
- Among personnel at investment management firms, accountants tend to be the least satisfied with service provider performance (as compared to asset managers and transactions professionals).
Portfolio performance evaluations have also highlighted a few things for property investors and asset managers to remember as they manage their third-party provider teams:
- Service providers in the multifamily sector are the most satisfied with their working relationships with third-party owners, while those in the retail sector are the least pleased.
- Rapid responsiveness from both asset managers and accountants is highly appreciated by provider teams, leading to greater relationship satisfaction.
At a time when property operations are so important to driving financial performance, building and maintaining smooth, efficient partnerships between investors and operators can provide a critical competitive advantage. A little listening (from both perspectives) can go a long way.
What do Residents Really Want?
Owners and operators of multifamily communities are discovering that it is more important than ever to uncover what truly drives residents' leasing and renewal decisions. Kingsley Associates' extensive multifamily research reveals the following:
- Nationally, the factors that have the largest impact on residents' initial community choice are location, property appearance and apartment features/finishes.
- The relative importance of community decision factors varies by market and resident demographics. For example, apartment features/finishes is twice as likely to be an important community selection factor in New York City as it is in Atlanta or Dallas. Additionally, location is significantly more important to residents under 35.
- The top three ways that residents initially find out or hear about their community are drive/walk by, personal referral and Internet listing/advertisement. However, residents under 35 are 50% more likely to cite Internet listing/advertisement than residents older than 35.
Are you missing any valuable insights from your resident base?
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