Question: How To Scale My Property Management Company?

Question

Hi everyone,

So here is the deal.

Started a PM company 10+ years ago as a subsidiary of our turnkey company (IMO it's a tough gig selling turnkey if you don't also manage in-house)

Hated the PM business for a good 5 years or so.

Then one day I woke up and smelt the roses and realized that PM is not so bad after all.

That of-course came at a time when things actually started to work and we actually started to "work" the systems just as they should be worked lol

We have reached a point now where it's a pretty well oiled machine other than the minor $#@% that we fix on a daily basis.

The business motto is systemize, optimize and monetize which is a work in progress but chugging along.

I'm confident that with the operation as it is today we are at a point where we can start to significantly scale.

Organic leads are flowing in nicely and we grow at between 10-15 units per month or so.

My questions are:

1) How do we potentially find other "mom and pop" shops what want out of the business and we purchase to take over?

2) How do we prospect for another local PM company and offer to buy them out? (I've personally cold emailed all of them and nada...)

3) Any suggestions on finding larger multifamily landlords and bringing their large bundles of units to our book?

Thanks for reading and your time in replying

ps. Not interested in expanding into another market

Engelo Rumora · Answer

So the conclusion is that it will just come down to "planting the seeds and reaping the harvest" at a later date.

"Your Network = Your Net-worth"

Been watching Evernest's video's and they share a ton on "everything and anything" property management related so that's been a blessing.

Biggest take away when it comes to scaling a PM is to spread the word about what you're looking at doing and to build relationships.

Local real estate events, NARPM, IMN, etc...

You want everyone to think of you if they are looking at selling or if they know of anyone looking at selling.

I use to be "loud and proud" and a huge extrovert but I guess "old age" has got me haha

I prefer drinking coffee and smoking a cigar behind closed doors.

But, I guess I'll have to start "shaking hands" and "kissing babies" like a president when it comes to networking again lol

Maybe even do a few video's while not wearing any pants hehe

Big hat's down to Matthew Whitaker for scaling the business so much.

I remember spending some time together in Birmingham when he had a decent sized operation of around 1,200 units or so.

Now they are 16,000+ 👏

HUGE...

We initially met as I was interested in selling our property management company in Toledo and now we are looking at acquiring others hehe

Time flies, things change and life is funny.

Thanks everyone for your contribution and wishing you much success

Jordan Myer · Answer

We use a company called RentScale. Great sales training on how to grow your PM business

Peter Tverdov · Answer

FWIW we usually have our slowest maintenance inquiries in Jan/Feb/March then it starts to pick up.

Paul Sverdlin · Answer

Try listening to Codie Sanchez on any social media platform. She specializes in what you seem to be after: buying up stable businesses for cheap, improving them, cashflowing and then repeating the process to keep expanding.

Not affiliated in any way; I just connected in my mind your questions with her approach.

Michael Smythe · Answer

Hah! We're in same boat as you!

1) Think of buying mom & pop shops like prospecting for other properties. Put them all on a quarterly email or postcard, so you're top of mind when they want to sell. Also, try to find the CPA's and attorneys that deal with them and do the same.

2) see #1

3) Advertise where they go, so you're top of mind when they want to sell. Also, try to find the CPA's and attorneys that deal with them and do the same. <seeing a pattern here?:)>

Connect & DM us if you'd like to speak more with our manager.

Engelo Rumora · Answer

Haha

Fair enough mate. I need to check data over last 5 years to see exactly but team has been on point. Especially last 24 months. Happy to see this 🙏👍

Engelo Rumora · Answer

Worked ourselves out of income here lol

Vacancies low

Maintenance repair requests low

Need to cause some drama so we can start putting some food on the table lol

Jokes.

It's interesting though how if you do a good job in property management you kind off work your way out of being able to generate more income.

I guess it's a good problem to have from a performance and ethics standpoint.

What do you guys think?

Grazie mille

Engelo Rumora · Answer

Great points mate and thanks

Matt Devincenzo · Answer

This isn't your question, but I think before you can consider how/where to pursue growth you need to define the market parameters. Specifically 1) what is the total market share available (especially since you want to stay in that market not grow into others) 2) who makes up how much of that market share?

If you're marketing to mom and pop PMs but they only have 5% of the total market share then even if you converted every one to your company, you've only grown by that 5%. Maybe that's great and what you're looking for...but if local LL are 30% self managed, would you be better served marketing to them and converting 1 out of 6 to get the same 5% market share?

I don't know those answers, and maybe you already do, but that's my first question I'd want to answer.

Question: How To Scale My Property Management Company?

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