concession
Employee Rent Concessions
This week we are rounding out our budget concession discussion with the topic of employee concessions. People are the difference that make a difference in property management. I would argue that it is not location location location but rather people people people that make or break the present and future value of an asset. You can have the best location on planet earth with the worst people and you are guaranteed sub-par valuation. Relocate that asset to a B+ location and team it with A+ characters and you will have yourself a winner. It really is all about the people. And, employee rent concessions are one way of saying thank you.
Value in Responsive Service
Beyond the concept of reward, concessions can be looked at as incentive for an employee to live on-site. There are clear advantages to owners when an employee lives on-site. It lends well to responsive customer service, especially if that employee works on the service side. As an example, if you have an A/C go out after hours, he/she can provide rapid and responsive service. If you provide lock-out services; the idea of rapid response is a real plus. In the event of a major crisis, employees living on-site can act as first responders in the way of organize and deploying crisis management protocols.
Things to Think About
I have seen this amount vary over the years and is certainly subject to ownership or property management protocols. It typically ranges from 15% to 100% and is credited monthly over the course of a lease term. It also typically carries a caveat in the way of an employee addendum that spells out strict concession payback and move-out protocols if the work relationship turns sour.
The biggest thing to consider is IRS implications. Always consult a good tax attorney when thinking about giving away money as I am certain our great Uncle will want his part.
Your – advocate of employee rent concessions – multifamily manic,
M
Student Concession
We are continuing our budget discussion this week with another short and sweet concession entry. Student concessions are used to attract those who are pursuing advanced educational opportunities at schools or institutions around your apartment community. This is a way that apartment operators can both attract and retain students in addition to giving them cause to talk about you. It’s all marketing all the time.
Concessions or Discounts
As an item of clarity – a concession is not a discount and a discount is not a concession. Both impact the bottom line but one lives on while the other has a one time impact. Student concessions are typically given up front at the beginning of the lease and or at the time of renewal. They are considered a one time event whereas a student discount is some that lives on over the life of the lease. Example of a concession might be: $200 off of your June rent if you move in by June 10.
A student discount on the other hand is a rent reduction from the market rent over the course of the lease. Example: you give a 5% or flat dollar amount discount off the market rent rate for the term of the lease that you sign if you move in by June 10. Both have an impact on the bottom line and both have a potential opportunity for you in the way of marketing.
Your – continuing the budget journey – multifamily manic,
M
Apartment Budget Conversations: The Courtesy Officer Concession
Photo by Fred Moon on Unsplash
In our recent discussion on apartment budgeting, I delved into two pivotal concession line items: new and renewal concessions. These concessions play a crucial role in acquiring new leases and boosting retention rates. Over the coming weeks, I’ll explore various other discounts categorized as concessions. I invite you to join the conversation by leaving comments, tweeting, sharing, and more. Today, let’s discuss the “Courtesy Officer Concession.”
What is the Courtesy Officer Concession?
At its core, the courtesy officer concession aims to attract and retain both on-duty and off-duty uniformed police officers. In essence, officers are offered a rent discount in return for specific services. The scope of these services is clearly defined in advance. Here are some tasks that might fall under an officer’s purview:
- Conducting nightly patrols of the property.
- Identifying and tagging vehicles that are illegally parked, inoperable, or have expired license plates.
- Compiling daily reports, highlighting issues such as property lighting or incidents during a shift.
- Ensuring amenities like the Fitness Center, Laundry Rooms, and Pools are securely locked every night and monitoring the office for suspicious activities.
- Regularly inspecting the entry gate, noting any damages or times when it’s found non-functional.
- Keeping the management informed about crimes in or around the neighboring area.
- Upholding a consistent, approachable, and professional presence in the community, regardless of duty status.
While this isn’t an exhaustive list, it provides a comprehensive foundation if you’re considering this initiative for your property. The concession’s value can be calculated based on an hourly rate, a flat rate, or a per-project rate. However, any resulting discounts will be recognized as a courtesy officer concession.
Final Thoughts
Offering concessions in return for services from uniformed officers can be an invaluable addition to a community.
