As the tax credit community continues to mature, asset management represents the single biggest opportunity for many firms to improve the performance of their properties and their companies. Asset management can help developers and owners identify opportunities to create value and collaboration, while mitigate risking across their companies and portfolios.
The National Housing & Rehabilitation Association’s first-ever Asset Management Symposium exceeded expectations, convening nearly 60 multifamily affordable housing developers, owners, and their partners for a day full of dynamic discussions. The day succeeded in laying the foundation for a peer network of professionals who had not previously had the opportunity to connect. While their organizations often compete for development opportunities, asset management professionals compete against the challenges of aging structures and materials, rising utility costs, and both known and unanticipated risk. The Symposium provided a forum to talk through these challenges and share solutions.
Joe Wishcamper, a developer and founder of the Wishcamper Companies, moderated the first panel and kicked off the day with a goal: Think about the things we’re not thinking about.
The Symposium featured discussions of obstacles and opportunities in the following areas:
- Collecting and managing data;
- Structuring and staffing an asset management practice;
- Managing corporate risk;
- Reducing operating costs and mitigating property risk;
- And informing new development.
Key takeaways from the day’s general and breakout sessions included:
- Acting on data is just as important as collecting it. Sophisticated data collection and management systems were on the wish-lists of many participants. While data is an important part of the asset management process, reports are only useful when their insights are put in practice.
- Don’t lose sight of the forest. There is a tendency for asset managers to get sucked into the details, but their role is to see the big picture. One participant cautioned the group from trying to do too much or micromanage.
- Many developers are seeking more sophisticated benchmarking practices. Most participants indicated that their current benchmarking practices are “rudimentary.” A few said theirs were robust and another few said they had none at all. Participants agreed there is no perfect source for industry-wide benchmarking data.
- Successful asset management requires open communication between departments. It is important to break down silos between development staff, property management, investor relations, accounting, and other departments in order to see the big picture.
- There is no one-size fits all staffing structure. The way asset management departments are staffed and structured varies greatly, and depends in part on available skill sets, owner goals and whether or not the company is vertically integrated. But, about one-third of participants said their Director of Asset Management reports directly to the President or CEO of the company.
- Asset management has a role in the new development process. Many development firms are giving asset managers a seat at the table when discussing prospective projects. Asset managers offer a long-term perspective because they are especially invested in ensuring a deal can be successful over decades.
The day’s discussions made it clear that the Asset Management Symposium was just the beginning of a larger conversation around many of these issues. NH&RA plans to develop a more formal peer network and welcomes those who are interested in joining. For more information, please contact Thom Amdur at email@example.com.