View 146 is one of our managed sites in the Everton area of Liverpool
Built in the 1960s, View 146 comprises two high rise blocks, with a total of 146 apartments. Originally built for the local authority, the development was bought in 2001 and underwent a £10 million refurbishment. When first completed, the ownership split was 70% leaseholders and 30% investors.
Following the financial crisis in 2008, the slump in the property market left many leaseholders unable to sell their properties at View 146. While some sales did take place, many owners opted to retain their apartments and to let them instead. This created a shift in the demographic of the development’s residents. At one point, approximately 20% owners lived in the apartments with 80% sublet to tenants. The high number of rentals created several issues, which included:
- Anti-social behaviour, including loud music, parties, and general disregard for fellow residents’ right to quiet enjoyment, Dogs / pets, Bulky items in bins or left in the bin stores, Washing on balconies, Parking in other residents’ car bays, Satellite dishes on balconies, Calor Gas being stored in apartments, BBQs on balconies, Properties being used for short term holiday lets.
The communication model had been to send regular circular letters and individual breach of lease warning letters to offending leaseholders and apartments. While somewhat effective, it highlighted a larger problem — landlords and letting agents were not informing tenants about their responsibilities under the lease agreement.
The initial response
It was clear that we needed to improve communications with all the residents at View 146. Mainstay wrote a bespoke Residents’ Handbook for View 146, which included details of the lease covenants. This was sent to all residents and owners.
Copies were also supplied to landlords and, where the Mainstay team could identify them, to letting agents. The result was almost instantaneous — behaviour markedly improved. Unfortunately, the uptick was short lived.
After a time, the number of incidents of poor behaviour began to creep up. Mainstay gauged the situation again. It was clear that letting agents and landlords were not giving the handbooks to new residents. During Mainstay’s research, it also became clear that with a high churn rate of tenants, property managers did not have up-to-date contact details for all residents. This was causing problems dealing with out of hours maintenance, as well as sorting out day-to-day issues. This was further frustrated by difficulties in reaching letting agents outside of office opening hours.
A Fresh Approach
Changing the communications strategy had shown that residents and leaseholders often broke the lease covenants because they were unaware of their responsibilities. When these were communicated to them, there was a significant decrease in the instances of the
Despite improving the way that we communicated, this message was not getting through because the View 146 Management Company could not rely on landlords and letting agents using the improved handbooks. To solve this problem, Mainstay proposed that we should find a preferred agent for the development. Our client – View 146’s Management Company – agreed and tenders were sent out. Each letting agent needed to complete a Key Requirement Questionnaire, to explain how they would:
» Communicate the tenants’ responsibilities prior to their move in date
» Vet prospective tenants to ensure they were suitable for View 146
» Engage with the onsite Building Manager
» Provide information about when new tenants were moving in
and their contact details
» Help to increase / improve rental yields
» Help improve property values
Mainstay then selected three agents to present to the Management Company. To gain ‘buy-in’ from leaseholders and encourage them to use the new agent, Mainstay secured preferential rates from the winning agent. Mainstay also agreed KPIs for the agent to achieve. These were reviewed quarterly, with the agent reporting on the following:
» Turnover of tenants
» Average monthly rental income
» Competitor monitoring — Sales at View 146 vs developments within a 10-mile radius
By appointing a preferred letting agent at View 146, the quality of tenants has improved significantly, incidents of anti-social behaviour have reduced and, if there are ever any issues, they are dealt with immediately. Mainstay staff know that the agent is available at any time, whether in or out of hours and a response is always received quickly; this has assisted with issues like leaks and other emergencies. The View 146 team are advised in advance of new tenants moving into the development, allowing time to prepare for the protective Lift Curtains to be installed for move-in day. The new resident information form with names, contact details and emergency back-up numbers is supplied to the managing team and, as part of this process, the tenant also receives a move-in information pack with a copy of the lease covenants as well as a Residents’ Handbook. As a result of this preferred partnership, rental incomes and property values have increased and, whilst it is not possible to force leaseholders to go with the preferred agent, it has been noted that approximately 80% of investors over time have transitioned to View 146 preferred agent.
Rather than being reactive to a problem, Mainstay worked to solve the deeper cause of the issue. Thinking beyond “bricks and mortar”, and using an innovative approach to solve the problem, Mainstay was able to improve residents’ enjoyment of their homes. At the same time, it allowed the Property Managers to do their jobs more effectively. The team’s solution also meant that property values rose from their previously depressed level. The preferred agent also saved leaseholders and landlords money by applying preferred rates. These improved standards not only made the development a better place to live, it increased revenues to owners.