San Antonio-based Embrey Partners has built a reputation by developing more than 41,000 apartments and over 6 million square feet of commercial property since 1974.
Even now, as the market slows, it has 6,000 units under construction in Texas, Arizona, Texas, Florida and Tennessee. And it soon plans to move into North Carolina.
Embrey is using its construction platform as a springboard for management growth. When it opens new projects, its own management firm handles lease up. After the property is sold, it is positioned to stay on under new ownership.
“Having to change to another third-party operator after we've finished a lease up and have a full staff doesn't always make the most sense [to a buyer]. So that's how we have capitalized on a lot of our growth,” Allyson McKay, managing director and executive vice president of management services at Embrey, told Multifamily Dive.
Currently, Embrey has 11,000 units under management, but it's pushing to grow that number. McKay, who was senior vice president for Dallas-based Lincoln Property Co., responsible for its Southwest and West regions, before coming to Embrey in 2021, is helping to lead that charge.
“We've actually done third-party for quite some time,” she said. “However, the growth on the third-party side is new. Over the last four-and-a-half years, we really dedicated the time to focus on the growth of third-party management.”
Here, McKay talks with Multifamily Dive about labor, expenses and centralization.
This interview has been edited for brevity and clarity.
MULTIFAMILY DIVE: With the slowdown in the transaction market, are you managing properties that Embrey has built longer than you expected?
ALLYSON MCKAY: I think everybody's in that same boat where they're trying to decide the perfect time to sell. Currently, we are holding a little bit longer until we find the right time.
What are your biggest property management challenges right now?
Labor is probably the No. 1 issue that everybody is up against. I think it's just being diligent in ensuring that we know the markets and are paying competitive compensation. We do a lot of recruiting in-house, which helps significantly.
Expense management is also a big issue. We know everything since COVID-19 has done nothing but go up, including taxes and insurance, which then makes you need to dial back on all your other expenses.
How is centralization playing into your property operations?-
You need to ensure that the teams on the ground have the ability to provide proper service. We're looking at all kinds of different technologies to help and economies of scale, such as putting a manager over two assets.
We haven't stepped into what we've seen at other companies where they’re bringing managers in-house and they're over multiple assets. We haven't dug into that yet. Most of our assets are luxury. It's just a delicate balance to ensure that we have the staff to provide that expected service and complement that with a chatbot to help answer some of those quick questions that [prospects] may need [answered].
What technology have you found to be effective in converting prospects into residents?
We gain leases through our chatbots. They schedule appointments and answer questions. We can see an ongoing dialogue with the chatbot and they are able to answer all [the prospect’s] questions and then send them to somebody to set an appointment. They are able to even follow up. So we do find it as a benefit.
I don't know that it completely takes the person away from the site. You have [prospects] who don't want to talk to us and want to look in the middle of the night because of their job and demands on whatever else they may be doing. They don't have that time.
Do you think you could have properties without staffers on site?
When we start on the development into the lease-up phase, it probably doesn't make sense for us not to have somebody on site. But I think we'll always look at options.
We're also building community. The residents want to interact. They want to know who's in the office. So, at some point, there's got to be that touchpoint, and the teams are the ones that are putting on the community events that we want the residents to come to. We want to connect the residents with the rest of the resident profile so that they stay longer.
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