When Redwood Capital Group decided to launch its management division, Redwood Residential, Mary Herrold knew the new company could benefit from a departure from the traditional market survey process. She knew they needed something simple, innovative, comprehensive and streamlined.
A multifamily veteran with nearly 30 years of experience in the industry, she is all too familiar with the numerous problems presented when onsite associates call comps to ask about rents and other data and then compile that information into Excel spreadsheets.
Long story short: the process takes way too long and frequently results in data that is not trustworthy.
Herrold, Senior Director of Marketing for Redwood Residential, wanted the company to get market surveys right from the start. So, she turned to BI:Radix.
“We love it. The onsite associates who are tasked with completing weekly surveys find it easy to use,” Herrold says. “I’ve never had a question or a complaint from a team member about it. I also know that I can rely on the data because the input flows easily.”
A Problematic Process
One of the primary problems with the traditional market survey process is its considerable inefficiency. Onsite associates with a lengthy list of other responsibilities place time-consuming phone calls to comparable properties.
Inevitably, they aren’t able to reach the people they need to speak with and then have to follow-up with another round (or two or three) of phone calls. To add insult to injury, oftentimes associates are not trained to ask the kinds of questions that will produce accurate data and true apples-to-apples comparisons.
Another set of problems arises when it’s time for associates to manually input the information they collect into Excel spreadsheets. To start with, they may enter the data incorrectly and with inconsistent formatting. They may spend too much time adjusting the column widths and the row heights to make the spreadsheets easier to read for other associates. And then, once a market survey in Excel is passed along for review and analysis, team members begin saving and emailing each other different versions of the same spreadsheet, creating unnecessary confusion. It’s like the game of telephone. Each time a spreadsheet gets shared, the data gets diluted. Also known as, data erosion.
Over the course of her time in the apartment industry, Herrold had grown exhausted with the traditional process and felt the new management company couldn’t afford its numerous drawbacks. “I’ve used different templates. I’ve written step-by step instructions, conducted in-depth training, and still found data that I couldn’t trust. The spreadsheet method is unruly. It is easy for busy site associates to forget to go back and complete information they may have missed inputting during the first pass. Although platforms are a better way, I found a lot of them cumbersome, time consuming and wrought with too many options to get any consistent measures over time.”
A New Day
Herrold’s search for a revamped market survey methodology led her to BI:Radix. She and Redwood Residential were quickly impressed with the product.
The solution dramatically streamlines the data collection process with its SurveySwap™, which enables communities to automatically exchange information with comps through the BI:Radix platform. As such, the result is more accurate and timely data and less time spent by associates making comp calls.
The cloud-based product also provides a centralized database for team members to view data. Its analytical tools illuminate pricing trends over time, something Excel can’t do.
One of the best things is the tracking of updates,” Herrold says. “I get a weekly report telling me the date each comp was surveyed. Our teams are updating surveys weekly (with ease), giving us 52 points of data versus the typical 12 over the course of a year.
Everything is accessible through the platform, and we trust the data,” Herrold says. “We rely on it for our decision-making and we especially like the trend report. Our market surveys aren’t something we just check off of the to-do list so we can add them to the financial reporting package. We’re truly getting value out of the platform.”
Engaging Onsite Teams
Similarly to Redwood Residential, Maverick Residential Company implemented BI:Radix when it launched. Jeff Krohn, President and Co-founder of the company, says his experience with the solution has been very similar to Herrold’s.
“One of the main things that was important to us and our management style, was to get our onsite associates out from behind their computers. Instead of doing data collection, we want them to be able to focus on taking care of the residents and creating an atmosphere that’s conducive to people wanting to live at our properties,” he says. “Every technology we selected needed to reduce the manual labor that goes into so many of the various tasks that onsite associates have to do.
BI:Radix was our first choice for market surveys because it eliminates the monotonous process of picking up the phone and talking with comps,” Krohn adds. “As the old saying goes: ‘garbage in, garbage out.’ A lot of the data was erroneous – human beings are fallible, and their ability to collect information and interpret information and then put it into a spreadsheet was taking way too much time.”
True Analysis: The Value of Apples-to-Apples Comparisons
Both Herrold and Krohn applaud BI:Radix’s ability to highlight pricing trends and provide true apples-to-apples comparisons between communities.
“We’ve had instances where we’ve identified: ‘This fee’s too high,’ or we’ve said, ‘Nobody charges this, we shouldn’t either,'” Herrold says. “It’s that eye-opening moment when we realize we could charge more because we weren’t meeting market performance. It helps us stay competitive and push the envelope where we can. And that’s invaluable to any organization, especially one that is just starting to establish itself as a strong management company.”
Data Drives Decisions
Above all, the information gathered by BI:Radix and the analytical power of the solution has helped Maverick Residential communities adjust their comp sets, according to Krohn.
“It allows us to really dive into the details and show our communities that certain properties they think they’re sharing traffic with are not, in fact, comps,” Krohn says, “On the flip side, it helps us identify properties that are comps that weren’t previously in the comp set.”
Community owners may sometimes balk at moving away from the traditional Excel-based system because BI:Radix carries an acquisition cost and Excel spreadsheets are free. But that line of thinking is extremely short-sighted, according to Krohn. “The Excel-based system certainly carries a significant cost,” he says. “You have to account for the hours your associates lose trying to collect the information and also for impact that bad data has on your pricing decisions at the end of the day. So to us, the minimal cost of BI:Radix is a no-brainer.”