Happy B’earth’day! Of course, we have no idea if this is the day our planet Earth was born, but it’s the day we’ve chosen to celebrate! It’s a reminder to be kind to Mother Nature, and property managers are the perfect advocates to lead the way in their communities. A focus on conservation not just on Earth Day, but all year round, will differentiate your property from your competitors in the neighborhood. On top of that, your existing residents will notice and appreciate your ‘go green’ efforts. A recent Forbes article noted that, “Millennials care deeply about the environment, the global community and social justice.” Also, a survey by TD Bank found that 49% of Millennials are interested in green buildings and green businesses, while 36% of Generation Xers and 27% of Baby Boomers are interested too.
If taking care of the planet and making your residents happy is a ‘two birds, one stone’ situation, then what can you do to go green? Maybe build a community garden, invest in solar panels, recycle, install energy efficient light bulbs, etc. You can also focus your efforts on the most impactful contribution; the conservation of natural resources like water, gas, and electricity. In the process, you’ll help the environment, attract prospective renters, and possibly increase your NOI. So how can you take advantage of these environmentally-conscious trends in a way that adds to your bottom line? We’ve selected our top five conservation strategies:
1. Monitor Your Consumption with Business Intelligence Tools
Do you have a firm understanding of your average spend for each type of utility at all of the properties in your portfolio? For example, if you look at your water charges every month across comparable properties, is every property’s usage relatively equal? Or are there any water-guzzling outliers or opportunities for improvement? We’ll admit, checking your properties’ utility usage levels manually is a difficult and time-consuming process. A business intelligence tool (BIT) can help you automatically keep track of your utility expenditures, recovery rates, outliers (potential “leakages”), etc.
With this kind of tool, you can build reports to determine the average or “normal” utility usage for your properties. Once you know what your normal rates look like, you should be able to set thresholds for your preferred metrics within your business intelligence tool. It should then notify you when usage spikes occur, so you can address them immediately and reduce waste. When you’re armed with the utility insights you need, you can confidently make data-driven decisions for your properties’ conservation initiatives.
2. Make Utility Usage Transparent
Most of us want to live an “eco-friendly” lifestyle, but don’t have the time or resources. We choose the convenience of driving our own car instead of carpooling or biking. We don’t compost because there isn’t enough space in our yard (and compost bins are smelly). We buy plastic water bottles because they are easy to grab and dispose of on-the-go. We all love the idea of conservation, but often choose convenience instead. One way you can nudge your residents in the right direction with little effort on their part is to hold them accountable for their own utility usage. Consumption-based billing is more accurate and fair for residents anyway. And if they are held accountable for their own utility charges, they’ll start conserving water, gas, and electricity right away.
You can post a Go Green Initiative notice on your community bulletin board or website reminding your residents to conserve by taking shorter showers, turning off lights, and adjusting the thermostat every time they leave their unit. However, a reminder may not be necessary. Fannie Mae’s Multifamily Energy & Water Market Research Survey found that, when apartment owners paid for all energy costs, median annual energy use was 26% higher than when tenants were held accountable for their usage.
So by decoupling rent costs from utility costs, your workload decreases, your residents are less wasteful, and your property value increases. According to Fannie Mae, “on average, a 100,000 square foot property spends $125,000 on energy and $33,000 on water annually. If this property saved 15% on energy and water costs, it would increase asset value by almost $400,000, assuming a 6% cap rate.”
3. Reduce Your Amount of Paperwork
Another easy, eco-friendly initiative is switching to electronic statements to save paper. Provide your residents with one monthly convergent e-bill that displays all charges including rent, utilities, and ancillary fees. Stop wasting paper by sending multiple bills for different charges, and easily combine them on one monthly statement instead.
Looking for other ways to eliminate paper in the office? Allow your residents to make online payments to replace paper checks, deposit slips, and trips to the bank. Technology has helped community managers become paper-free in almost every other aspect of their job, yet many are still overrun with paper rent checks at the beginning of each month. In our experience, management companies that want to eliminate paper checks all together must provide their tenants with at least one free online payment option. Residents will always be more inclined to transact online if they don’t have to pay a fee for it. ACH (also known as e-check) is the most popular payment type that property managers choose to incur, because it tends to have lower processing fees than other payment methods.
Encouraging residents to sign up for recurring payments (autopay) will also help to decrease the number of paper payments you receive. When a new resident signs a lease, offer to get them signed up on recurring payments right away. Autopay is a great resource because it reduces your chances of receiving late or incomplete payments, and your residents don’t have to think about searching for their checkbook.
Another paper item cluttering day-to-day life in your community offices are money orders. You can avoid money orders all together with the help of a CashPay solution. This lets residents make a cash payment in person from one of 25,000 retail locations like Walmart or Kmart. Their payment is electronically sent to community managers and integrates into property management software. No paper necessary.
4. Install Submeters
Submeters are conservation MVPs because they precisely track each apartment unit’s utility consumption, allowing property management companies to accurately bill their residents for their share of the utility bill. Submeters are so effective at driving water conservation that drought-sensitive California recently passed a law requiring water meters to be installed at individual apartments starting with new developments in 2018.
If you already have submeters installed, we salute you! However, if your submeter game is sub-par, you should think about retrofitting your property. The initial investment to retrofit may seem steep, but with the proper balance of incentives and long-term savings, the effort will ultimately save your property management company money and help save the environment.
As community leaders, property managers have unique insight into the amount of natural resources being consumed by their residents. Create conservation awareness by making your residents responsible for their own consumption. This focus on conservation will lead to behavior changes that reduce use and waste. It will be a win-win for you and your residents. We are all responsible for taking care of Mother Earth by not wasting the natural resources we all share, which as an added bonus, cuts costs for both property owners and residents.
5. Engage Residents
Engaging residents in conservation-themed activities is an easy and productive way to connect with them. Host a tree-planting event, for example. It will be fun for residents (especially those with children), and good for your property aesthetic. Trees clean the air, provide oxygen, and also help prevent soil erosion.
Talk to local leaders about their environmental concerns, and host a “Recycling and Conservation 101” educational seminar. Set up e-waste recycling bins so your residents have a safe and responsible way to dispose of old electronics.
Brand your community or property management company’s name on reusable water bottles and grocery bags. People love free swag, which means they’ll be repping your logo around the neighborhood, creating brand awareness for prospective residents. It’s also an effective and easy way to promote conservation. It has been estimated that Americans use 100 billion plastic bags a year. The production alone for that amount requires about 12 million barrels of oil, not to mention the ever expanding landfills needed to hold the discarded bags and plastic bottles. This trash has also caused incredible harm to marine wildlife. So to discourage the use of disposable bags and bottles, give away fashionable, branded, reusable bags and water bottles for your residents to take with them to the grocery store, gym, etc. These small changes will make a big difference to our environment over time, and will help to keep your community cleaner.
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