O P E R A T I O N S C H E C K U P

HOW HEALTHY IS YOURPROPERTY MANAGEMENT SYSTEM

A HOLISTIC APPROACHTO OPERATIONSThe growing market demand for rental housing makes it essential that your business is in the

best shape possible to compete and still reduce expenses. This means the overall health of your

operations is critical for success. But good property health isn’t just about maintaining high

occupancy, low overhead, and consistent rent collection. It requires a holistic approach that

assesses the needs and performance of each of the key segments of operations. They include:

APARTMENT RENTS

HAVE RISENNEARLY 16%NATIONWIDE

SINCE2010

TAKING THEINDUSTRY’S PULSE

PURCHASINGA spend management tool that increases purchasing power and

processing efficiencies.

REPORTINGReal-time reporting from a

multi-tier database that gives you the real-time data you need to

make profitable decisions.

BUDEGTINGA web-based budgeting tool that works

with all market types and includes market-specific functionality.

DOCUMENT MANAGEMENTSeamless document management

workflow that significantly reduces paper costs and protects your residents’ PII.

SaaSAn integrated SaaS property management system

that centralizes practically all aspects of operations to increase revenue, reduce expenses, and minimize

risk for the entire portfolio.

ACCOUNTINGAn accounting solution that effectively streamlines back-office functionalities,

enabling accountants to handle more properties.

FACILITIESAn expedient facilities and inspections process that helps reduce maintenance

costs and recover damages.

PAYMENTSA payments processing system that

provides convenient online andin-office options, and cuts

transaction costs for the property.

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EXAMINING ACCOUNTINGAn optimum accounting system requires more than a spreadsheet application, which can

limit your scalability. If you’re operating with a handicapped accounting system, you could be

stunting your growth. Examine your system by answering the following questions:

Does your system simplify accounting processes and workflows with real-time central transaction processing that saves more time and allots more properties per accountant?

Can your system streamline back-office tasks with electronic signature and automate payment approvals, bank reconciliations, central disbursements, and allocation tables?

Can your system perform check runs across multiple banks processing up to 1,000 checks at a time—eliminating the need to run checks separately for individual banks?

Does your system have anefficient way to import bank filesfor reconciliation to reducecompletion time?

Does your system have the online capability to identify budget variances to help with recovering expenses and reducing losses?

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If you answered no to any one of the above questions, then you’ll want to consider remedying the deficiency with an integrated property management system that provides more automated accounting functionality to increase the productivity and property scope for accounting staff.

RENTERS MADE UP MOST OF THE 1.5 MILLION HOUSEHOLDS

ADDEDQ1 2015

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CHECKING YOURBUDGETING REFLEXESNot all multifamily verticals operate alike. When it comes to budgeting, it’s imperative to have a

tool that can adapt to your specific market type—be it conventional, affordable, student housing,

military, rural, etc.—with the use of widgets and wizards that help account for expenses and other

factors unique to a particular market. For example, an ideal budgeting solution would be able to

configure the preparation, routing, and approval workflow for budgets. It should also be able to

automatically distribute budgets to the appropriate personnel, both at the site level and the central

office, to track projects through to completion and minimize or prevent going over budget.

It’s also important to have a system that streamlines the data import process with the capability to import operational data from multiple sources and for multiple properties—all at one time.

Flexible reporting is also key to a robust budgeting tool. You should be able to view real-time detailed or summary-level performance, and 12-period or long-term rolling forecasts on demand. Viewing options should also include variance to budget and actual data that allows you to easily analyze trends, spot problems, or exploit opportunities.

A healthy budgeting tool isn’t complete without forecasting functionality that factors actual performance and original budget for more accurate forecast results.

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PREVENTIVE MEASURESFOR HEALTHIER PURCHASING Without the right spend management tools, purchasing overruns can take a large bite out of your

bottom line, contribute to asset underperformance and leave all stakeholders feeling a little sick.

Following are some preventive measures that can help improve efficiencies and reduce expenses:

28% OFMILLENNIALS PLAN TO RENTOR STILL BERENTING IN 2020

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Automate approval workflows and save time with electronic invoicing,

allowing more time to focus on revenue generating activities.

Reap bigger discounts by using online catalogs associated with

large and establishedvendor networks.

Standardize vendors and products to increase control and reduce

maverick spend.

Adopt a system that usesapproved vendors.

Establish an efficient and effective vendor credentialing process that

weeds out those with highrisk factors.

Set budget controls and spending limits that encourage and empower

staff to negotiate the best deals.

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The ability to quickly document findings at move-in and move-out (including photo and note tools), and compare inspection histories.

Checklists that can be quickly accessed and easily customized.

TAKING THEINDUSTRY’S PULSE A FACILITIES FITNESS TEST

Accidents happen. And so do damages. Here are the key components that a facilities tool

should possess in order to keep your property in peak condition:THE NUMBEROF RENTERS 65+WILL REACH

12.2 MILLIONBY 2030

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A mobile-optimized and customizable inspections app that is made to

accommodate your maintenance staff—not the reverse.

The ability to create and respond to work orders in the field.

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A DOCUMENTMANAGEMENTDIAGNOSTIC Let’s face it. Paper is a thin excuse for optimum document management. It’s no longer worth the costs incurred for storage and manual handling. It also creates risk because of the likelihood that documents will be lost, misfiled, and confidential information more easily stolen. Your electronic document management system needs to be able to reduce these risk factors, meet compliance, and improve document approval workflows across your portfolio. In addition, a best-in-class electronic signature solution (e.g., DocuSign®) that can be integrated with your document management platform is key to meeting resident demands. This calls for an application that can meet the demand in the most cost-effective way possible, like unlimited signatures—so you’re not paying per transaction. Give your residents the ability to sign leases anytime, from anywhere—even their mobile devices. You can also significantly reduce the cost and time associated with printing, scanning, and storing paper lease agreements. If your current system doesn’t have standardized documentation, automated organization settings, secure storage, and disaster recovery practices, the diagnosis could be a grim one and measures need to be taken to rehabilitate your system.

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86% OFTHE NATION’S APARTMENTS ARE OWNED BYAN INDIVIDUALINVESTOROR A LIMITEDLIABILITY PARTNERSHIP/GENERAL PARTNERSHIP,

OR LIMITEDLIABILITY COMPANY.

REVIEWING YOUR REPORTING When it comes to reporting, three-tier database architecture is ideal. If a provider is using a two-

tier database architecture, it means that they run all month-end reports, all long-running reports,

all day-to-day transactions, and everything else from a single server. This can contribute to erratic

and unreliable response times, and can have a huge impact on your productivity and volume.

A three-tier database architecture is more secure, stable, and processes transactions as fast as possible by running reports on one set of servers and transactions on another, all synced in real time. It speeds up response times significantly and eliminates volatility 24/7, 365 days a year.

With centralized and real-time reporting capabilities, you should have full visibility into your business operations and be able to quickly identify opportunities for increasing revenue, minimizing risks, and reducing expenses.

The ability to create a variety of standard and custom reports to inform owners and investors is a hallmark of a remarkable reporting system. This includes reports that cover your entire property landscape from a birds-eye portfolio level to a more granular analysis of individual units.

The health of your business depends on the strength of your analytics and reporting tools. The more accurate and immediate the information, the better you can spot beneficial and detrimental trends, and discover inconsistencies that can determine the short- and long-term trajectories for better business outcomes.

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PAYMENTS PROGNOSISA survey of nearly 15,000 residents conducted by the National Multifamily Housing Council

revealed that almost 80% preferred paying rent online6. If your property is manually

processing payments for rent and other fees, then the prognosis for improving portfolio

performance and resident satisfaction could be a grim one.

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With the increasing demand from residents for more online conveniences—from paying rent to utilities and other fees—it’s necessary to have a payments processing solution that has the flexibility to facilitate in-office payments and still enable you to accommodate residents who want online options alternatives that are quick, simple and secure.

For those paying in office, your system should be robust enough to provide easy check scanning, and credit card and debit card processing through the federally regulated Automated Clearing House (ACH). Money orders are another payment method that can be made more safe and convenient with electronic options. For residents who are inclined to go the online or phone route, your system should be able to securely process debit and credit cards without saddling you with transaction costs.

With an integrated payments solution through a licensed money services provider, it’s possible to achieve optimum performance. You can increase staff productivity by automating routine tasks like posting payments directly to the ledger and reducing trips to the bank. Providing more options to pay, especially online, also increases rent collection rates. Overall, integration helps ensure compliance and meet residents’ growing expectations for 24/7 service accessibility.

PAYMENTS PROGNOSISFollowing is a concise checklist you can review with your staff to help determine the condition

of your current payments system. If you answer no to three or more of the questions below,

then it’s time to get on the road to recovery.

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Payments Prognostic Assessment YES/NO

Our current payments system is integrated with our property management system.

We have an online resident portal where residents can pay via ACH or credit/debit cards.

We accept payments in office with credit/debit cards.

We offer our residents payment service options over the telephone.

We offer our residents electronic money order payment options.

We have an in-office check scanner that automates check processing and eliminates trips to the bank.

We are part of the ACH electronic network.

We have at least one staff member responsible for understanding and addressing compliance and regulatory issues regarding our payments system.

We work with a licensed money service provider as part of our payments system to mitigate risk and liability.

We’ve eliminated our payment of convenience fees by integrating with a licensed money services provider.

CONTRACT SERVICESCOSTS INCREASED TOAN AVERAGE OF

$296PER UNIT

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IMMUNIZING AGAINST POOR PERFORMING PROPERTY MANAGEMENT SYSTEMS The human body is a complex network of 13 different systems that need to work in synchronicity

to achieve optimum performance. Fortunately for operations, it just takes one integrated property

management system to achieve optimum performance for your entire property portfolio.

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A comprehensive on-demand property management system (operating on a SaaS platform) provided by one vendor, means that you have a high level of data security because it is protected by multiple firewalls and automatically encrypts sensitive client data such as PCI, ePHI, and PII.

Monitored at all times, this type of infrastructure practically eliminates system malfunctions and routinely backs up your data to a different data center or offsite tape location so it’s always protected against disaster and always accessible.

These systems are also scalable, where the platform adapts and grows as your business grows. Only they can provide this kind of flexibility to accommodate your changing portfolio needs.

But your portfolio isn’t the only thing that is changing. So is the technology. Constantly. Because of the efficient way on-demand systems are designed, innovations and enhancements are automatically pushed out every few months—just like the operating system on your mobile phone. And since the changes are seamlessly rolled out, users easily adapt, which means you don’t have to waste time and money on additional training.

No one area of your business operates in a vacuum. That’s why working with one vendor that offers integrated solutions rather than multiple vendors is especially important. Only by fully integrating them can you maintain security and stability to achieve year-over-year growth.

RECOMMENDEDTREATMENT PLAN If you’ve been relying on different point solutions to manage your properties instead of one fully-integrated property management platform that provides an SaaS infrastructure with accounting, budgeting, purchasing, facilities, document management, and reporting, then you could be losing money and underperforming in the market.

With one integrated solution you can eliminate the need for manual data entry with seamless, automated processes that save time, reduce errors, and ensure that information is more accurate. And you can trust identity protections for your business and your residents with multiple safeguards.

Call us at 866-520-7807 to find out how we can helpkeep your properties healthy and running smoothly.

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1http://www.wsj.com/articles/bidding-wars-

return-to-home-market-1437350840

July 19, 2015

2http://blogs.wsj.com/developments/2015/05/13/

survey-more-millennials-renting-but-just-as-

many-want-to-own/

May 13, 2015

3http://www.bloomberg.com/news/

articles/2015-07-21/boomers-competing-with-

millennials-for-u-s-urban-rental-housing

July 21, 2015

4http://nmhc.org/Content.aspx?id=4706

May 2015.

5http://www.naahq.org/learn/income-and-

expenses-survey/2014-survey/infographic

2014

6Key Findings from the 2013 NMHC/Kingsley

Associates Apartment Resident Preferences

Survey” by CoreLogic

SOURCES