Julie Blank  0:00  

That’s when we started realizing what is it that we really need that we’re doing still manually, right, we’ve got three different people doing it manually to get us the information we need. So it’s been, it’s been wonderful to say, oh my gosh, you can automate this, these are the five different pieces that sometimes we just do without because it’s takes so long to pull together manually, but it’s so critical to helping us make decisions instead of guessing. So that’s really been helpful and working through this analytical platform that we’re using in this platform also communicates with our property management system. So it’s, it’s pulling a lot of information out of that system as well. So we’ve been able to really pull information because we’re a renovated renovation company, that’s what we do. You know, we really try to track closely our interior renovations and what’s the bump that we get from old lease, you know, rent to new lease rent and what’s the market piece versus renovation piece? So all of this we’re trying to build into the system so that it’s, again more automated streamline the integrity information is there and it’s providing us with real quick information so we can make quicker decisions, and it’s creating efficiencies because we’re not manually doing it anymore.

Announcer  1:18  

Welcome to CRE PN Radio for influential commercial real estate professionals who work with investors, buyers and sellers of commercial real estate coast to coast whether you’re an investor, broker, lender, property manager, attorney or accountant we are here to learn from the experts.

J Darrin Gross  1:37  

Welcome to commercial real estate pro networks, CRE PN Radio. Thanks for joining us. My name is J. Darrin Gross. This is the podcast focused on commercial real estate, investment and risk management strategies. Weekly, we have conversations with commercial real estate investors and professionals who provide their experience and insight to help you grow your real estate portfolio. 

Today, my guest is Julie Blank. Julie serves as the chief operating officer at new standard equities, where she leads the firm’s corporate multifamily operations, Investor Relations and asset management. And in just a minute, we’re going to speak with Julie about the role technology plays in bringing multifamily teams together in a geographically dispersed industry. But first, if you could help us out a little quick reminder. If you like our show, CRE PN Radio, there are a couple things you can do to help. You can like, share and subscribe. And as always, we encourage you to leave a comment we’d love to hear from our listeners. Also, if you want to see how attractive Our guests are, be sure to check out our YouTube channel. You can find us on YouTube at commercial real estate pro network. And while you’re there, please subscribe. With that, I want to welcome my guest, Julie, welcome to CRE PN Radio.

Julie Blank  1:18  

Thank you, Darrin, it’s a pleasure.

J Darrin Gross  3:04  

I’m looking forward to our conversation today. But before we get started, if you could take just a minute and share with the listeners a little bit about your background.

Julie Blank  3:12  

Sure. Well, as I say I’m an accountant by trade but not by personality. My, my career was as an auditor, starting with Arthur Andersen in back in Cincinnati, so I graduated with my accounting degree my CPA started as a public accountant realized early early on that, again, I’m a combat type of personality. So I really wanted to get into operations. And when I moved from Ohio to Arizona, that’s when I decided to make a career change. However, no one would hire an accountant to do anything other than accounting. So I was a couple of months without a job. So I decided to go ahead and do get an accounting job ended up in a company doing property management. So that was really my first introduction into this industry was as a property accountant doing accounting for a third party management company. And that was many years ago. And here I am now you know, living the dream, I guess you could say. But it’s been great. I’ve I’ve worked in with some of the large institutional firms in the industry. And I’ve been with new standard equities now for about six years as the chief operating officer but I’ve really worked in all different segments of property management and real estate.

J Darrin Gross  4:35  

That’s great. The the the numbers mean a lot in real estate and and having them all in their correct categories and and accounted for properly. I mean, it’s amazing me you know, the the, just the, the depth of accounting that you can get into with with real estate, not just your not just your rent and your you know your mortgage and as, you know, the rent in the mortgage job and payroll and, and all that, but then you get into cost segregation studies and all sorts of things that can really make tax. You know, I guess a tax savings and tax advantage really amplify the tax advantages, I would think that you were uniquely qualified to really recognize that and be able to explain it to anybody that’s got any questions for you?

Julie Blank  5:27  

Yeah, you know, I think having that balance of, you know, the, the numbers and operations certainly has helped around me out to be a great resource for my company, and the companies I’ve worked for, and really, you know, in a lot of different factors as it relates to looking at underwriting and market analysis, you know, in right now, with the market the way that it is, and the interest rates, you know, increasing, you know, some of our assets, we have floating rate. And so it’s being able to do that, that forecast to say, hey, what point, you know, are we going to, you know, find some challenges, and what do we need to do now to prepare for that. So it’s certainly as has come in handy. And even though I didn’t care for accounting, I certainly we do it all over again, because it’s got me where I am today, and I love where I am. So it was, it was good.

J Darrin Gross  6:20  

Oh, that’s good. So let’s talk a little bit about new standard equities. Tell me a little bit about the firm. And what’s the, what’s the, what’s it all about?

Julie Blank  6:34  

Yeah, so we started about 2010. And we are a vertically integrated, value add multifamily firm. So we are strictly focused on West Coast. And by being vertically integrated, you know that we have our own property management and as property management, construction management, asset management, and, of course, our investment management team. And focus on the West Coast, we’re in Washington and California right now, with the goal of expanding into Colorado and Utah, we basically said in, you know, we want to be within three hours of all of our properties, planes, trains, or automobiles, we want to we like being close to the assets. Not that we’ve ever had to jump on a plane and be at one of our assets in three hours. But it allows us to make sure that we’re physically at the assets across all of our different divisions. So that’s important to us. And we’re private, privately held firm. We have about 2000 units right now. And because of our business strategy, you know, we we acquire, we dispose, so we’re constantly in that cycle of acquiring properties and disposing of properties. So we’re looking to expand double in size, which is a little challenging when you’re disposing and acquiring a lot of times we, we kind of net net at the end of the year, but it’s in the last six months, we acquire two deals and dispose of one and we’ve got about three that we are actively in due diligence with right now. Got it?

J Darrin Gross  8:22  

The couple of questions for you. The investment strategies is basically value add, improve and and dispose of that. I hear that right? That is correct. Yep. All value add multifamily. All right. And then as far as what’s an average hold time for you guys.

Julie Blank  8:38  

We’re about four years. Yeah, there’s some assets we’ve you know, because of market and, and value we’ve been able to dispose of in three and sometimes we hold until five. Couple properties. We’ve had six that were about an average of four.

J Darrin Gross  8:55  

You mentioned goal of 2x in your your, your company or I’m just curious, is that based on doors or equity or how do you how do you measure them?

Julie Blank  9:09  

Based on doors. We’re about 2000 units right now and so we want to try to get to 4000 and we’ve recently engaged in new relationships with institutional partners which you know is going to help us get there a little quicker as well.

J Darrin Gross  9:27  

Got it in you mentioned you guys are private in you also mentioned partners are you are you are syndicating these properties or how are you?

Julie Blank  9:39  

Yeah, we have a few syndications. But most of our assets are joint ventures

J Darrin Gross  9:49  

All right, and then you mentioned your territory Oregon or not Oregon. He specifically did not say Oregon, you said California and Washington and looking to go into Colorado and Utah. and being vertically integrated? Are your Do you have multiple properties in in the same location? Or same town? Or how are you? How are you set up there?

Julie Blank  10:14  

Yeah, we do. So we have properties in the East Bay area, we’ve got six there, we have two in the Inland Empire in Southern California. And then we have five, in like the greater Seattle area. So we are a bit concentrated in the different regions we’re in. We’d like to have boots on the ground for both of the property management and construction management purposes.

J Darrin Gross  10:42  

Got it? Well, you’ve clearly demonstrated, you’ve got lots of moving parts, between the geographic locations and, and all the different people and and, you know, even with the joint venture investors. So let’s talk a little bit about how you are able to communicate with everybody and keep everybody moving on the same page.

Julie Blank  11:10  

Yeah, you know, the intrinsic nature of our industry creates natural barriers, because of being geographically dispersed, so we do really rely on technology in order to, to bridge that gap. So we have a lot of the portals, we’ve got investor portals that help us communicate with our investors, we have resident portals to help communicate residents employee portals to communicate with our employees, training portals, I think this is probably very common in our industry, we’re not the only ones that obviously have geographically dispersed properties. We use all those pieces of technology as well as some analytical platforms to to help communicate, teach, learn, train, educate. And then of course, for reporting purposes, but we will we still really focus on the face to face engagement, because real estate is still a lot about relationship building, whether you’re at the site level, building relationships with our residents and your prospects or, you know, relationship building for with brokers with investors, you know, there’s only so much you can do when you’re via via zoom or, or Google meats or something, it really still is about physically being together. So we we tried to create that balance, where we still have company events for our employees, where we still really try to get face to face with our brokers in our equity partners and our potential investors. Because, you know, it’s it’s real estate. And we also like to still get to our, our assets as well. So even though you can do a lot of it remotely, there’s still a missing piece, because it’s a physical asset. So we That’s why I said, we have to be within three hours of our assets, because we, we think it’s important that we’re on the asset, looking at it, feeling it, seeing it, making sure our business plans are being properly executed, building relationships with our employees for tenure. So we do really try to have that balance, and really looking at technology as a as a supplement, but not a substitute for our business is really how we look at it.

J Darrin Gross  13:27  

Got it. And when you talk about the different types of technology, I mean, you mentioned zoom and and meet, I think it was a meet today with the Google one as it used to be. Okay, so they’re funny how some of these things, they’ve had different names at different times, so I can’t keep track them at all. Beyond that, are there other? Are there other technologies that you guys employ to you know, or is it due to kind of limited to that in that that, you know, the, as far as the video conferencing, are there other platforms that you guys utilize to you know, restored as far as technology goes, that could help you out?

Julie Blank  14:13  

I think as far as like video conferencing and seeing people is mostly zoom, you know, we’ve got the Zoom screens in our in our different corporate offices, so that we can have our, our regular meetings with our on site teams with our other corporate team members. We’re based out of Encino in the valley. And we have a regional office in Orange County and then of course, all of our satellite offices and where we operate. So really, it’s I think Zoom is the one when we want to see people in and engage. But we’ve we have other platforms like an analytical platform that we use as a communication tool, between site and in corporate and we So how to select the employee portal that is a communication tool. So really, it’s it’s really finding the different ways to message out from corporate and receive information from the sites in order to make sure there’s open communication as much as possible when you’re geographically dispersed, I think a lot of times is there’s a breakdown in communication when when you’re spread out, but we have the employee portals and the the analytical portals that we use for those communication purposes. In addition to the zoom for the face to face,

J Darrin Gross  15:36  

I’m curious if for the different portals, is there a common entry point for management? Or is it is that is it an exit this one, get into that one exit this one to get into that one kind of thing? Or?

Julie Blank  15:51  

question because I think we’re probably split, we’ve tried to integrate our systems as much as possible. So there’s like a, you know, a single entry, single sign on. That’s what we’ve really been focused on most recently is okay, we’ve got these, whatever 20 Different platforms are probably exaggerating, but we’ve got 20 different platforms, and you know, 10 of them, you can all get in through this one portal, but then the other ones are all individual sign ons. So we’re really trying to figure out how do we create a better efficiency with the different platforms we have. And even right now, we’re actually migrating a couple of our stand alones on to a more global platform to eliminate multiple silence. So we’re trying to be very aware of that, our onsite teams probably feel the most impact from all the different pieces of technology, because they’re the ones that are really, it’s more day to day. For data entry purposes, we’re into it more just for reporting purposes. So the more that we can streamline the different pieces of technology, the more efficient that they become on site, too. And the more that they adopt it, the harder you make it for the onsite teams to gain access to go here go there, the less that they’re going to engage with it and use it properly. And really hold themselves accountable. So that’s what we’re really focused on now. Because we do have a lot of different pieces of technology that we need to really pull together and streamline and almost bundle.

J Darrin Gross  17:30  

So let me ask, I’m not really super tech savvy, I’m understand a few of the concepts. And, and the one that always caught my attention was single entry input was like, you could put it in one time, and it would populate all these things. And, you know, I’ve never found that to be the case, it seems like you’re constantly we’re constantly inputting data, because the this platform doesn’t speak to that platform, blah, blah, blah. And you’re and so it’s very frustrating from that standpoint. But, but I’m curious, you were talking about, you know, just the, the, the, I guess, resistance, if a if it’s not easy to use, and then trying to consolidate or, you know, get get to a point where there’s like fewer entry points, have you found that either there’s a platform that makes it available to you, or that you can get multiple platforms to, to talk to each other to where it’s more of a, you know, a saint or a fewer entry points? Or do you find that the different platforms are there? No, that that’s, I mean, what I find is a lot of resistance wherever they want to fee in order to make that to happen kind of thing, and then it doesn’t work. You know, we’re just kind of curious if that’s what you find, or if you found a secret way to make that all work together.

Julie Blank  18:56  

If I had this secret, I’d be making a lot more. Yeah. I wish I had a secret I was sharing to make all of our lives easier. But I think I go back to what I was saying is really being able to look at all the systems we have right now that some of them promise that they’ve communicated with other systems that were existing. And then we found out they didn’t really have to pay more, or the communication still require too much manual attention. So those are the ones that we’re looking to eliminate. But we have two systems right now once a property management platform and one is it as an analytical tool. These are the two we’re really trying to say, Okay, we want everything to feed into these two systems. And that’s it and if it doesn’t feed into these systems, then we need to decide how important is it to our core business to keep it or to let it go? Because we spend a lot of money on technology right and we buy it and we set it up it’s it’s a lot of you know, a lot of labor cost a lot Time, and not just the technology but people’s time, just to find out that when you roll it out, it’s either not being adopted or it doesn’t integrate well. So that’s where we’re really pulling back to say, okay, these two systems are the two we’re going to use, and can we get everything we need from it. And I’d say, by the end of the year, we’ll be where we hope to be, if it does everything we want to, and will really just be using these two systems, which also talk to each other, that we can be more efficient, more streamlined, will have more accurate data, less manual inputs, you know, the garbage in garbage out. So the more automated we become, the more integrity of the information we have, that we’re relying on to make business decisions. So yes, I think we’re, we’re really looking at these two systems to be the ones that allow all the integration we need that are supposed to communicate with all the different systems we have, that we can rely on going forward. So I’d say about a year we’ll probably draw, anticipated three or four pieces of technology that we’re currently using as we streamline around these other two platforms.

J Darrin Gross  21:12  

So I’m curious, with multiple properties, and multiple platforms, have you been able to kind of test different platforms against each other to find? Which one? is the best fit for you? Or is it been more a matter of kind of migrating to just one that was recognized as doing more, or how have you gone about making your decision,

Julie Blank  21:36  

we actually have a focus group that we get to that we pull together depending on the software, but a lot of times, we’ll pull property manager members into the focus group asset management, we have a head of innovation director, Senior Director of Innovation we pull in, and then if we need to pull our marketing team in whatever, we have a focus group. And so we say, Okay, this is the piece of technology we want to look at, they will go out and look at all the different vendors that provide that technology, that through the different system options. And then we really decide on the one, we rarely find an opportunity where companies will allow you to test, you know, for too long, and so you’ve got to already make a capital investment in one or both of them. So really, what we try to do is say, okay, how can we minimize a mistake, by maybe we just phase it in, so we say, okay, we’re not going to roll it out to all of our properties, we’re just going to choose Northern California, and then we’re going to, you know, to use it there, see that works. work out the kinks, if we’re happy with it, then we will go to the next phase and enter into a contract portfolio why. So we have found that it’s, it’s more manageable to phase it in like that. And it’s less costly or more cost effective. Because if it doesn’t work, then we’ve committed ourselves to a smaller piece of our portfolio. But that’s really how we we’ve tried to work through it. And that seems to work for us to use, we get the buy in from all the different groups that are going to be a part of working in this system. And then we get to kind of test it out. And on a smaller scale that’s more manageable.

J Darrin Gross  23:19  

Got it? I was just in there thinking as you were talking, in that you guys are acquiring properties on a regular basis. Have you acquired any properties that had a system that that you weren’t aware of that worked really well that that you stayed with? Or has it? Has it been kind of the system that you’ve had from corporate to you’ve pushed out?

Julie Blank  23:44  

That’s actually a good question. And I have to say maybe it’s because of the class of property, we buy the size of properties we buy, but we really haven’t purchased a property that we were introduced into, you know, to a new system, and that we adopted, a lot of times they might have the same systems we do. So it’s actually easier, we just kind of roll it over and we keep going. And now know, I can’t say we have so what we do is we just you know, use the systems obviously, that we have in place and we you know, plug and play into the new acquisitions that will take over.

J Darrin Gross  24:26  

So, the sounds like you you’re getting down to two systems, which is sounds to me, like amazing compared to you know, the, just the multiple options that I have, I just find it so frustrating the amount of time it takes to get a result, at least in our industry that the you’re inputting this system that you got to input that system, that input in that system, and it’s essentially the same information over and over and over again. Which it seems to me then if somebody was really to come to this problem, and it’s not unique to, to property management or or insurance or anything, it seems like it’s everywhere. But if you could just create the portal that everybody plugged into, and you could create the face of whatever that is to where the technologies came in and populated the bill or the from the one common and went out or something like that just seems like it just seems too simple, that we continue to have this problem, but it just, it’s an aggravation of mine that I just gotta let go. But But I’m glad to hear that you’re, you’re moving to at least more of a, I guess, fewer systems. And I would assume that that based on having fewer systems and having the testing that you’ve done that you’ve got buy in and you know, the more people use it, the more familiar they are with it and how to use it. And they’re more likely to use it to give you the data that you need, so that you can make the decisions that are critical to your business. So that kind of the endpoint there?

Julie Blank  26:03  

Oh, absolutely, because most of the information that we rely on is from property management, feeding information into the system. You know, we obviously have Asset Management who’s doing their piece of it, but a lot of the information starts at the site level, you know, that it’s impacting them your operational information and your financial information that you’re making your business decisions on. So it really is about the adoption of the on site teams. But what we’ve found is it’s not so much training them on the system itself. That’s a huge piece, yes. But it’s explaining to them, whoever the end user is explaining to them why, like, why are we capturing this information? What do we do with the information? Once you’ve put it into the system? Why is it so important? Let me explain to you why what you do in this system matters to the overall business plan and how we use it to make decisions. I had one recently that I went through this, I was in our Washington area. And I went to all of our assets. And I was, you know, as we walk through the property information and the operations and walk the property and the financials, and, and I realized that just by being there and talking to them about the system that was in particular the information in it, you can see that they were like, I get it like now I know why you’re asking me to push this button every day, you know, so shame on us that we didn’t kind of have this bright light before. But after visiting that region a few weeks ago, that’s when I realized that we need to spend more time explaining to them why they have to work into this system and enter the information they do. Because this is what how what you do impacts the performance of the asset and the decisions that we make. So it adds value to themselves as well, that what they’re doing actually matters.

J Darrin Gross  28:04  

Now, that’s that’s a really good point. I’m curious, you know, this is all ventually or it’s all data. I mean, big data is basically the mean, we’re, we’re we’re finally to a point where we’re we’re able to or we’ve got enough data that we can make decisions that that are somewhat predictive based on, you know, the past kind of thing. With, with the the data you’re collecting heavy, have you been able to recognize certain data as not useful and and and also recognize other data that would be useful? And is it if you have any examples of that that that you’ve you’ve had over the years?

Julie Blank  28:56  

Yeah, actually, really great question. I think my first focus point is, what did we realize we needed in working with this, like this analytical platform, this contractor we’re working with? We’re he’s really helping us build the platform. For us. It wasn’t like, hey, choose, you know, Platform A, B, or C. It’s like, okay, here’s kind of our basic, but we’ll help build you what you want to be specific for your needs. That’s when we started realizing what is it that we really need that we’re doing still manually, right, we’ve got three different people doing it manually to get us the information we need. So it’s been it’s been wonderful to say, oh, my gosh, you can automate this. These are the five different pieces that sometimes we just do without because it’s takes so long to pull together manually, but it’s so critical to helping us make decisions instead of guessing. So that’s really been helpful in working through this analytical platform that we’re using. And this platform also communicates with our Property Management System. So it’s it’s pulling a lot of information out of that system as well. So we’ve been able to really pull information, because we’re a renovated renovation company, that’s what we do, you know, we really try to track closely our interior renovations, and what’s the bump that we get from old lease, you know, rent to new lease rent, and what’s the market peace versus renovation fees. So all of this, we’re trying to build into the system so that it’s, again, more automated, streamlined, the integrity information is there and it’s providing us with real quick information so we can make quicker decisions. And it’s creating efficiencies, because we’re not manually doing it anymore. There’s still been a lot of manual reporting that we’ve been doing, for different reasons once to save money. Technology’s expensive, right. And because of the size of company we are, we’re not small, but we’re not large. So having those economies of scales to really get this big technology has been challenging for a company of our size. So we’ve always had to weigh technology versus I guess, payroll, right, you know, a few hours of someone’s time versus spending 1000s of dollars, you know, till we scale up. So that’s been a challenge for us, too. And then the other part of that question, you said is other things that we’ve been eliminating? I don’t think we’ve eliminated information that we’re like, oh, we don’t really need it anymore, but never really looked at it, don’t use it. I think it’s actually us adding information we need into these new systems so that it is automated versus being you know, a manual report. That’s where we get our biggest benefit, I think.

J Darrin Gross  31:43  

Gotcha. I’m curious. With property management, how granular do you get with the data? Can you give kind of a an example of what your property management team is? is collecting or inputting?

Julie Blank  32:01  

Oh, yeah. Every Tuesday, we have our revenue management call. So this is a very granular example. And we have Asset Management and property management on those calls for the specific region. And we’re looking at everything from lease trade out numbers down to how many days vacant, or the units that have been sitting there. So in everything in between lease renewals, going down to actually looking at the individual, and do they have balances due because we’re in COVID. And so there’s still this this COVID collection issue and stuff. But it’s very granular. And I think that’s why it’s so important for us to have our in house property management team, because it allows us to stay close to the asset, it makes us very nimble and quick to make decisions. There’s not you know, a lot of red tape or or, you know, toes, we have to step on, and you have a third party management company, but it does allow us to stay close to the asset to make decisions quicker and making sure that we’re aligned with the business plan. So, yeah, we were looking at days vacant, and then we’ll talk about staffing, you know, why is it they can, you know, that hasn’t been ready in 60 days? Why is it not ready in 60 days, while we don’t have a maintenance team, and we’re having trouble with, you know, contracted labor, because they’re having the same issue in our, you know, economy where, you know, it’s labor markets short, and supplies are hard to get. So these are all the things that we’ve talked about. So we do get very granular in those discussions, so that we really understand, you know, what is the root cause? And how can we fix it? And, you know, it’s a collaborative approach to making sure that, you know, every team is successful in executing the business plan.

J Darrin Gross  33:47  

Appreciate your turn. What about with the tenants? How, how are residents how the tour technology integrates with them?

Julie Blank  33:58  

Yeah, I think we’re pretty consistent with the rest of the industry where we have the resident portal and prospect portal so that they can pay their rent online, they can put in a work order online, of course, they can email the the office. So I think everything is there, we have, you know, self guided tours, if someone wants to do a self guided tours and option, the virtual tours, I think I think we’re pretty competitive with the offerings that are out there for residents, you know, everyone these days, they don’t want to really engage with a human if they don’t have to. So we want to make sure we give those people the options to never speak if they don’t want to to us, but you know, we’ve got the chat bots and everything as well. So I think we have to be that way for this. This generation we’re in because we’ve all been kind of conditioned, you know, to go through technology to communicate, it’s quicker and if you don’t respond in that time have already lost them, you know, you’ve got like a couple of minutes, and then they’re gone. And we’re done. So we have to have that in place, but we still have our staff on site. So that those that you know, want to engage, we’re there and available. And you know, we have to be available. There’s some people who don’t want to use technology, there’s some generations who, you know, still want to talk to people. So again, it kind of goes back to that balance of, yes, we have all the technology that you want, if you don’t want to ever speak to us. But if you do, we’re here as well. So you can come see us or pick up the phone.

J Darrin Gross  35:32  

I think I’m crossing over from the technology to the like the people human contact, and it’s sometimes the I mean, technology is great when it works. I think that’s one of the frustrations with it is that, you know, I think that in a platform that you’re in daily, you’re familiar with the ins and outs and how to do things. The frustration, I think I find is more often with the the app that somebody told me that I had to have a download that I use once every so often that every time I go into it, it’s needing to update or they’ve changed something or I can’t remember my login. So I think there’s there there is a frequency of use, that I think has to be taken in consideration for actually making it you know, something, but I mean, somebody who if you’re paying rent, or you know, communicating with landlord property management, or whatever, it seems like that’s a frequency that’s regular enough that that should shouldn’t be a resistance. Have you had much resistance? Or do you percentage wise, you mentioned there are some that still like to talk versus some that are, you know, more than like the technology? Is there a percentage number if you had to guess what that might be that, like the technology versus the still in person?

Julie Blank  36:52  

would be a total guess, you know, I just recently was looking at our online payment penetration rate. Right. So how many of our residents are paying, you know, online, whether it’s through credit card or ACH? And I was actually shocked by the the low percentage, and, you know, we’re about 50%. But again, I think, you know, just the, the geography in which we’re in, I think, maybe leads to that, to that. That being said, I think people I think maybe 50%, because I think people still, you know, some people are just comfortable with the connection, you know, the talking to someone and feeling like you can rely on them, and that they’re honest, they have some integrity. And that, you know, there’s emotion that comes out of speaking with someone and seeing their you know, why to their eyes, I say, and that means something to people, I think there’s probably part of part of the process, whether you’re a resident or a prospect is fine to do through technology. But I think at some point through any piece of the of the process, there has to still be that human connection. So, you know, maybe maybe half of our residents still want to communicate face to face. And maybe the other half, you know, we’d rather just do it through technology or an app. But we still require of our on site teams to no matter what standard operating procedure, what process we have in place, we still put a touch point in there of a human contact, so that we create that sense of resident tenure, you know, resident retention, that we’re not just a chatbot or robots or AI that we’re, you know, we care, and that’s one of our values is accompanies, and one of our core values is we care and, you know, we care. So we are we’re available for you and really to build that relationship is through face to face interaction to so that’s important to us through, you know, all this technology is great, but like I said, it’s a supplement and not a substitute for what we do. And, you know, again, real estate is a relationship building industry, I think, and we like to keep it a main point of our focus.

J Darrin Gross  39:15  

No, I agree. I’m curious on the 50% that aren’t utilizing the ACH or credit card for for rent payments, any sense of percentage that are unbanked? Is that a low percentage with with your, your residence or maybe

Julie Blank  39:41  

20%? Yeah, okay. Some people still are a little hesitant to give out their banking information. They don’t want to automate it in case there’s a dispute, you know, over the rent or a charge. I still think that there’s some skepticism out there among individuals. was okay. So, you know, we we still allow them to, you know, give us a check or money order? And that’s what they’re comfortable with.

J Darrin Gross  40:09  

Yeah, no, it’s it’s interesting. That is what about with your vendors? Is there a URL your vendors plugged into the platform, so if you need something new, you are able to communicate with them, or is that an outside platform.

Julie Blank  40:31  

It’s, it’s a platform rolled up into our property management system, that they you know, as far as invoicing and everything, certificates of insurance, that’s all automated so that that communication is through automation. You know, there’s, we have a small percentage of our vendors that are outside of that program, not the insurance piece, that’s always important piece. But you know, some of them are really small kind of family run businesses that are a little less technically savvy, that, you know, sometimes run outside of our of our platform, but I’d say we have about 85 90% of our vendors that we use through the portal.

J Darrin Gross  41:21  

And I’m curious, with the platforms and stuff, designed to use your IT department, or who’s responsible to make sure that are the monitors to make sure things are working the way they’re supposed to, as far as a communications.

Julie Blank  41:39  

That would be me, and my Director of Innovation are the two of us are kind of the it for the company. And again, it’s because of scale, right? I mean, we’re, I’d love to have an IT division. But it’s, we’re not quite there yet. So it’s myself and our Director of Innovation, that really makes sure that the technology that we choose, you know, we bet it well, that it’s going to integrate that we have a good relationship with the with the with the vendor, the contractor. And then she’s responsible, our senior director is responsible for understanding the integration in the communication among the pieces of technology, and carrying on the training, the rollout and the relationship with our contractor, which is extremely important. So you know, there are moments we have to reach outside and get an IT consultant, it’s rare, that we’ve been able to usually figure it out ourselves and just working with our contractors.

J Darrin Gross  42:44  

Well, I think the key to that, that, that I’ve come to recognize is that if nobody’s paying attention, or there’s not somebody that’s, that’s kind of, you know, looking over it and making sure that it’s doing what it’s supposed to do or you know, left on and others, some famous quote out there talking about whatever you whatever you fail to inspect or whatever. You have to constantly stay on top of in order to make sure it works week, you know, you’re getting what to expect.

Julie Blank  43:13  

Absolutely. And that’s what our Senior Director of Innovation does. I mean, I can’t do that every day in my role, but that’s what she’s really tasked with is ensuring that what we’ve signed on for is working the way that it’s supposed to, from the vendor side, but then also internally, are we doing what we’re supposed to be doing to make it work as well as opposed to? And are we using it to full capacity as the other way? It’s like, example, like my iPhone, I probably use 20% of this 100%.

J Darrin Gross  43:43  

Remind me of that.

Julie Blank  43:44  

Exactly. I have teenagers as well. So I know, I’m not using 20% of my phone capacity. But that’s the same thing with the technology we have in our in our firm, we you know, are we using it to its full capacity and getting not just our money’s worth, but really using it to help us continue to be more streamlined, automated and help us make better business decisions quicker, with more integrity of information.

J Darrin Gross  44:14  

And I think one of the frustrations I have with that is that I think there’s a lot of people that understand how to push the button, but don’t understand what the what the information behind the button means kind of thing. And I’m still a mold. I’ve been doing this long enough to know that before there was a button, I had to know how to do that to get results kind of thing. And so, you know, there’s a part of me that I know how to do the work as opposed to just push the button that gets frustrated with the people that don’t understand the work that’s been done when you push the button and so but anyway, it’s kind of a I mean, if the work gets done and it gets done the way it’s supposed to, what’s the difference between push a button or you know doing the work if you’re still getting The results you need. But I think there’s, there’s I guess for myself, it’s kind of just that that reconciling and recognize that hey, look, you know, we’re getting what we need, you know, what do you carry God and kind of thing so, but no, I I applaud your efforts here, you know, being spread out the way you are and all the transactions and the people you have the different moving parts and, and trying to find your way through these different systems that, you know, it’s, it’s a chore. And, you know, I think that the thing that I recognize it’s, it’s not like technology is going to go away. It’s just in it’s a constant update. Thanks. So I mean, just because something’s working today, you would expect that the next iteration will work better. However, I’ve seen that that’s not always the case. But there’s usually there is a progression period. And so I guess we’ll get used to it. Julie, if we could, I’d like to shift gears here for a second. By day, I’m an insurance broker. And I work with my clients to assess risk, and determine what to do with risk. And there’s three strategies we typically consider, we first look to see if there’s a way we can avoid the risk. And if that’s not an option, and we look and see if there’s a way we can minimize the risk. And if we cannot avoid or minimize the risk, then we look to see if there’s a way we can transfer the risk. That’s what an insurance policy is. It’s a risk transfer vehicle. And as such, I like to ask my guests if they can look at their own situation. frame the question, however you choose to whether it be your clients, investors, technology, employees, the market, politics, how are you whatever you you think might be the the biggest risk, but see if you can identify what your your biggest sort of skills. And again, for clarification, while I am an insurance broker, I’m not necessarily looking for an insurance related answer. And so if you’re willing, I’d like to ask you, Julie Blank, what is the biggest risk?

Julie Blank  47:24  

Well, a couple of months ago, my answer might have been different than now that you know, the market has been changing so drastically with the I think with the speed and magnitude of the interest rate increases, it has, you know, spooked investors, it’s you know, put some weight in the cell of borrowing. But there’s still a lot of capital out in the market. You know, investors want to do deals, they, they need to place capital. So deals still get done. But I think the the risk that we’re looking at now is being able to continue to do deals, but looking at the severe impact that the interest rates will have on your cash flow. You know, especially for us what we do, we’re value add, so our, you know, our cash on cash is, you know, already a little low, we’re more about, you know, when we when we dispose of the asset. So when you are in a area that we are and interest rates are increasing, we have to really step back and really scrub the underwriting be a little bit more conservative, educate our investors, you know, some investors have stopped investing, some have become a little bit more cautious, rightfully so. And then, you know, we have other investors that are still going, Hey, let’s figure out how to make it work. So it’s really just being able to realize that the market is changing now, and that it might continue to be that way for the next, you know, couple of years, not only on the acquisition bid on our existing deals, like I mentioned earlier, in our conversation is, you know, some of our deals, we have floating rate so it’s being able to step back and forecast and look at what the risk might be, how do we overcome the risk and be more proactive right now. So I think a lot of it’s going to come down to just kind of protecting cash flow and being able to underwrite new deals, and realize that we’re not going to get to the, you know, 1819 20% returns that we were able to underwrite, you know, a few years back and be be satisfied that we might get 11 or 12%, which is still really good as a return and that you know, apartment investment is still the top You know, real estate investment type. And we’ve been in difficult cycles before in real estate, and we’ve survived. So yes, there’s a risk, we’re not going to be stupid, we’re optimistic, we’re cautiously optimistic. But we also know that real estate is still a good investment in apartments in particular, especially the asset class we’re in, we’re B class. So we’re right in the sweet spot that the markets are gonna are doing well, the economy’s doing well C’s go to B’s, when the economy starts to not go so well, the A’s go to B’s. So we were we’re a bit protected as far as the as you know, occupancy and rents and stuff. But I think we still have to realize that there, there’s going to be some risk and some hits on our cash flow because of the interest rate increase, but I think it will, won’t make us stop doing deals, we just have to be a little bit more cautious and, and work with our investors much closer. So that we you know, have a better understanding of where we are and where where it’s going to go. I don’t have a crystal ball. I wish I did. But it’s hard to say things are have moved so fast, that I think just taking a step back and looking at things closers is something we need to do. But at this point where we’re continuing to operate business, as usual, with continued focus on being aggressive, as much as we can with rents, which is going to help overcome the, a little bit of the interest rate increase in the inflation, and continuing to work in our technology platforms to get all the information we can to make good decisions. That’s where we are.

J Darrin Gross  51:47  

I appreciate you sharing that. Definitely some challenging times ahead. But like I said, we’ve been here, done that and and, you know, survive, it’s kind of just a matter of, you know, changing the chapter here for a little bit and then go back to the chorus.

Julie Blank  52:05  

So we didn’t know we’d survive a pandemic. Right. Right through it. I mean, we’ve been through worse. So we’ll get through it. We know we will

J Darrin Gross  52:15  

have to. That’s the only way. Julie, where can listeners go if they’d like to learn more or connect with you?

Julie Blank  52:23  

Well, we have a website, which is new standard equities.com. Scott information about the company about the executive team, all of our properties. And my information is on there as well. So, I mean, I can give you my email, I don’t know what you’re looking for. But

J Darrin Gross  52:45  

knowing we can point him to the website and that we get there. So all right. Well, Julie, I can’t say thanks enough for taking the time to talk today. I’ve thoroughly enjoyed it. Learned a lot and I look forward to doing it again soon.

Julie Blank  53:01  

Sounds good. Thanks, Jared. It was a pleasure. I had a good time too.

J Darrin Gross  53:04  

All right. For our listeners. If you liked this episode, don’t forget to like, share and subscribe. Remember, the more you know, the more you grow. That’s all we’ve got this week. Until next time, thanks for listening to Commercial Real Estate Pro Networks. CRE PN Radio.

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