Turnkey properties aren’t just about barely rehabilitating the rest of 1972 and leaving it at home. So some people are crazy about it. But not me.
For me, the turnkey property is to leave it in the best possible form for both the tenant and the owner. The goal is to minimize capital spending, find the best materials that last the longest, and protect tenants from everything.
A few years ago, our team was in the process of dozens of rehab projects, preparing dozens more within a month. Such amounts bring incredible growth to the company. However, staff must run the process of these properties to assist in the depth and ruthless implementation of the system. There are also opportunities to miss or fail within a process or project. And that year, I missed Mark for a week.
Understand your process (and where it was wrong)
It was a fairly nasty inspection report format for properties for first-time clients. She wasn’t happy (a conservative expression of the year), the inspector’s words didn’t help, and how we say we’re doing a really great job I was in a bad position to explain if I failed. #notawesome
One of the things we really do as a company is to define the type of refurbishment to be done, plan the scope of work, share it with our clients and get a clear idea of what’s happening in the rehab. is. Then tell the client about it. We want to get the products we are proud of, our clients are happy with, and our tenants want to move in. Usually we hit that high horizontal bar set for ourselves.
However, in this particular case, there was scope for collaboration, but the plan was not carried out. We were put in a bad position because the inspectors didn’t stick to our main goal of making this house great before they were there. We had to deal with the client and resolve any issues that we might have been able to deal with before the report. It left us a lot of subsequent unpleasant conversations.
It’s terrible to miss the mark, especially when it’s your fault.
When we hurriedly called to discuss with the executive team, we soon realized that we were ready to fail. Our timeline was too aggressive. I wasn’t doing the usual two and three checks in the field because I was trying to set a deadline.
That was a stupid idea.
In this case, I returned to the project as a team and reviewed the process. Looking at the timeline, I realized that they were unrealistic. Before deploying inspectors and appraisers to the facility, we needed to build a little more time and a better process for internal reviews of all projects.
To be correct
We get a lot of business from clients coming from other turnkey providers. Our decisive factors as a company are our very high level of customer service, our ability to deliver very good products, and our excellent internal asset management.
It’s all great until something isn’t great and you’re the one who has to get it right.
What is important to me is that we did not spend time blaming anyone or anything as a team or individual. Our problems and solutions were very clear to all of us. There is a problem and you need to deal with it effectively and in a timely manner. Everything will be repaired or repaired according to the inspection report. I won’t discuss it. I didn’t ask the client for this cost or help with it.
We received the report, made a mistake, and took immediate action to resolve and correct the problem.
Learn from your mistakes
Sometimes learning is fun. Sometimes it’s difficult to learn. Sometimes learning is painful.
In this case, it was definitely the latter kind. But that’s okay. From this experience, we have made some immediate but calculated changes. Later in the post-acquisition process, we will sell the property for renovation. This shortens the client’s overall sales period. It also gives you a better understanding of when the project actually ends and you don’t feel like rushing to the finish line.
Also, after the rehabilitation is complete, we will first send an inspector for an internal check to resolve the issue before the client’s inspection and evaluation. By doing this, we want to virtually eliminate the possibility that this unpleasant experience (for us or our clients) will reoccur.
Why this story is worth telling
I wanted to share this story for several reasons. First of all, we are not perfect. It’s hard to imagine that it’s always 100% great and not always perfect. And this moment was no exception. But I wanted to make sure we were clear. Unexpected things happen in every rehab project. You have to expect something unexpected.
So, instead of making excuses for things, it’s a good idea to name, own, and resolve them before you find a bigger, worse, or more difficult problem. My goal is not to reduce the inspection items we have to fix in every house from now on.
is that true? I’m sure some properties will be more and some will be less. But we now have the opportunity to learn and grow. We were able to show our clients that we are committed to having the best traits. From the moment we noticed the mistake, we had the opportunity to offer them the best experience.
Always do the right thing. After all, you only have your reputation. In this case, it’s a great turnkey house that needed a little more help to reach the finish line.
When was the last time you made an avoidable mistake in your investment business? What did you learn and how did you get it right?
I want to hear your story! Please be sure to leave a comment below.