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Apartment Case Study: ZAZ Apartments

With agreements in place and logistics worked out Mills Properties started to manage ZAZ on June 16th, 2010. ZAZ is an 80 unit community in Maplewood, MO located right across the street from City Hall and Maplewood High School. It is a distressed asset boasting a physical occupancy in the teens. If you factor in the delinquency of the current base – well let’s just say there is a ton of upside.

The property has zero amenities outside of it’s location which is just minutes from good shopping and killer night life venues. It’s aesthetically unappealing having been fashioned after a road-side hotel – exterior entries and all. It’s brick construction, has tons of asphalt and has a name and signage that would fit as a  good frat house.

With occupancy in the tank and amenities as sparse as water on hot summer day on the Sahara – Mills Properties has its work cut out for it. But on the downside of any adversity lies the seeds of greatness. As long as you know how to look for them. The good news is that we don’t have to look to far in this case. Just eleven months ago we transitioned management of an asset right around the corner from ZAZ called Oxford. I like to refer to it as the Oxford Files. The occupancy was not quite as bad – sitting at just over 70% when we took over in August of 2009. It took us just over seven weeks to put on 20+ points of occupancy and swing the cash flow positive. The coolest part – $0 real dollars were spent on traditional means of advertising. Demand was created nearly 100% by Craigslist posts which were done on a daily basis without fail. I have a strong feeling that the results at ZAZ will be no different –

Hold tight for this ride – as we intend to record the ups and downs right here on the M Brewer Group Blog. Call it an exercise in real time results with the world watching. My hope is that we end up calling it an exercise in results on a shoe string.

As we roll along feel free to chime in using the comments section –

[Disclosure: I work with Mills Properties]

0 Responses

  1. Mike – This case study is a FANTASTIC idea! Bravo to you and Mills for the courage to put this “exercise in real time results” out here for the rest of us in the multifamily world to experience. I am very excited to see how the ZAZ project turns out and look forward to updates!
    Thanks for sharing,
    Trevor

    Reply

    1. Trevor

      Thank you for taking the time to comment.

      This should be fun and in the same respect packed with challenge. We just found out today that we have some issues to work through with the city prior to allowing occupancy – let the fun begin.

      I am going to try and do weekly updates for the next six to eight weeks as we amp it up – so, wish us luck.

      Thanks again.

      M

      Reply

  7. This post reminds of the expression “There's no crying in baseball” which I absolutely love Tom Hanks for doing such a great job in a movie about woman in baseball during wartime and the expression certainly applies here. Mills has a job to do even under the most challenging circumstances and with your corporate culture approach you will succeed. Thanks for sharing Mike.

    Reply

    1. Thanks for the kind remark about our culture – and, I love the Tom Hanks reference. As it concerns the occupancy, we have not seen anything with this much upside.

      Thanks for chiming in – hope to see you back as this one starts to unfold. Have a great week at NAA –

      Reply

  10. Ditto on the above. I came to this post late, so I just want to wish you luck with finding the time to keep us updated and do all that needs to be done! I'm looking forward to staying on top of this with all of you at M Brewer Group

    Reply

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