❏ Headquarters – San Diego, CA
❏ Regions Served – California (primarily Southern California) and Washington state
❏ Units Under Management – 5,200 (portfolio mix of fee managed and owned)
❏ Rainmaker Products Used – LRO and Intelligent Lead Management (ILM)
About two years ago, Pacific Living Properties, which manages 5,200 apartment homes in California and Washington, began implementing LRO in its portfolio. The reason was simple: the company wanted a sophisticated yet easy-to-understand solution to ensure its pricing was competitive and that it could push rents when possible. Today, Pacific Living is using LRO on 1,500 units including both stabilized assets and communities currently undergoing renovations. Recently the company began using LRO for the first time during a new community lease-up.
Early in 2016, Pacific Living added another weapon from Rainmaker to its arsenal by implementing Intelligent Lead Management (ILM) across the majority of its portfolio. Almost immediately ILM has spurred a major change within the company's operations. Now through the use of the two successful solutions, Pacific Living is able to execute its marketing and pricing efforts with a thoroughness that will serve the company well regardless of market conditions.
- Use LRO to further improve net operating income (NOI) through rent growth
- Implement lead management to gain a firm understanding of all the factors affecting a community's performance in signing new leases
- Allow LRO and ILM to work in close concert to improve Pacific Living's demand-generation efforts
- Pacific Living is able to price its units as competitively as possible because of LRO's sophisticated algorithm and projection of future occupancy trends.
- ILM's call recording function gave Pacific new insight into the quality of its interactions with prospects, leading to a revamping of its call-center operations that has improved lead conversion rates.
- Though its use of both solutions, Pacific Living has gained a much more in-depth perspective on all the factors affecting demand, enabling the company to better navigate all types of market conditions.
"LRO has transformed our revenue management. It's so easy for our team to use and understand, and it makes sure that our rents are exactly right for our submarkets. With LRO we know the forecast for future occupancies in our submarkets, and it helps us make better-educated decisions about how to handle upcoming lease expirations," said Jahna Overcash, executive vice president at Pacific Living Properties. "ILM allows us to see that same kind of data-driven, easy-to-understand solution at work for our lead management. The combination of these two best-in-class technologies will allow us to maximize our demand-generation efforts in any kind of environment."
Challenge: Improve NOI Across Diverse Portfolio
Managing the pricing of any given apartment community is often a major challenge in and of itself. Expand that task across a portfolio containing a mix of stabilized communities, new lease ups and properties in renovation, and the challenge becomes that much more daunting. Pacific Living needed a solution that could help it manage concessions more effectively, better understand performance against pro formas and respond to rapidly changing market conditions across its diverse portfolio.
Pacific Living partnered with Rainmaker LRO – an easy-to-use revenue management system that collects and synthesizes a wide range of data to efficiently set competitive rents – and to push those rents when possible.
One of the first indicators that LRO revenue management was the right fit for the company came from the warm reception it received from Pacific Living’s onsite staffs. "What I hear from our site associates, and this is extremely important to me, is that the Rainmaker products are so user-friendly," Overcash said. "Easy-to-read dashboards, easy-to-read reporting. The onsite staff doesn't have to spend a lot of time trying to analyze higher-level data that typically asset managers or vice presidents should be analyzing."
Results, ROI and Future Plans
Pacific Living has benefitted from LRO's ability to work on any type of community. The guidance provided by the solution during a renovation has been particularly striking, according to Overcash.
"Doing as many renovations as we do, LRO helps us keep an eye on our pro forma and where we're sitting compared to that," Overcash said. "It helps us determine what changes we might need to make in our system or in our daily operating functions to meet those goals."
And because of the firm pulse LRO has on the submarket surrounding a community due to its comp data and forecasting ability, it helps Pacific Living see that concessions often can be avoided.
“We were able to see that we don’t always have to give these concessions. I think that’s one of the great things that LRO really does.”
With LRO now firmly entrenched in Pacific Living's operations, the company decided to bring a similar level of data-driven analysis and sophistication to another component of demand generation: marketing and lead management. The firm implemented ILM across its entire portfolio at the start of 2016.
ILM's rich data on the effectiveness of a community's advertising sources in delivering qualified leads has been a tremendous asset, as has its call-recording function. Empowered with the ability to listen to call center conversations, Overcash and her team quickly realized the provider they were using was not an operational fit for its communities and made the decision to change call centers.
“Without the call recording capability we assumed our call center was producing results,” Overcash said. “Armed with the across-the-board analytics from ILM, we were quickly able to recognize that in fact our call center was underperforming and negatively impacting our ability to sign new leases. It empowered us to make a huge operational change that will positively impact our overall revenue.”
The function also has enabled the company to improve their leasing associates' phone interactions with leads. "If an associate is having problems closing leases, we have them listen to their calls, and we talk with them. 'What do you think of that call? What do you think you could have done a little bit differently?' You can also have them listen to other communities that maybe did something a little bit different that worked. It's really just a wonderful training tool."
With both LRO and ILM in place, Pacific Living is confident it has the resources and support it needs to create the most effective demand-generation program for any type of market. "With these two solutions, it's easy to identify trends and patterns, because they're literally right there in your face," Overcash said. "You're managing them constantly."