New Concept, Asking for Feedback

[Jackson Hanssen]

Hi y’all! I apologize in advance if this is the wrong forum, I wasn't exactly sure what to submit this to.

I’d like to start off by introducing myself, I’m a rising senior at a state college majoring in finance. I’ve been a long time lurker here on BiggerPockets and am involved in real estate investing with my family! In addition to going to school and being involved in my family’s real estate dealings I’ve recently developed a concept for a property management company.

However, this property management company would operate differently than the traditional model. The company would be partnered with a leading Multi-Family Property management group but would focus exclusively on SFR's and MF's that are too small to justify on-site management. I believe that through this partnership I could provide value to you (SFR and small MF property owners) by doing a few key things.

• Providing Handyman services to owner’s at cost. To give an example; for small jobs when owner’s need to hire someone to fix a toilet or un-clog a drain owners or local property managers hire a contractor to complete the work order. By having Handymen on the payroll I believe that I can fulfill these small common problems at a lower cost, because the company would be making absolutely zero profit off this service. What we pay, you pay.
• Large Scale Capex. The large MF property manager we would be partnering with has set vendors that they use for large scale projects, from roof repair to sewer lines. By utilizing the economies of scale my company can pass on below market rates to the owners of SFRs we would manage. This could be substantial when you consider how much capital is required for large scale projects, like roof repairs or new HCAV units.
• National coverage for all of your properties. Many investors own properties that are in different markets and so have to be managed by different property managers. With my company you could have all of your properties and the key information about them in one easy to access location with the same service and expectations applied to all of the properties you own.
• Full Service Company. The company would be able to manage all parts of tenant management from leasing to work orders and could manage tenant move out such as cleaning and any needed repairs. This process would work similarly to having full-time handymen, as my company would also employ full-time cleaning staff, which would allow my company to provide cleaning services to property owners at below market cost.)

Now after reading all of that I have to ask a favor of you, the BiggerPockets members. I’m seeking any thoughts or comments you might have about the concept. Any and all feedback is appreciated, so please don’t be afraid to be critical. Thank you in advance for reading this and hopefully together we can bring a service to life that adds value to real estate investors nationwide.

Jackson

[Justin Owens]

Welcome! Might that state college make you a Sun Devil? If so, congratulations. Sounds like a good concept. I lean to self management because I think a PM will be adding costs to repairs and/or not shopping it around. A PM would likely go for ease and not look for value for me and my investment. If you had slack in a handyman/on site contractor's schedule and could service off site clients as well, effectively - well that sounds like an excellent use of resources.

The problem I would see is getting your first smaller clients. But as you prove the system and more importantly the savings, they will bring more properties and other investors under your umbrella.