As published in Scotsman Guide's Commercial Edition, September 2009.
Despite vacancy rates reaching a 22-year high in the second quarter of this year, according to Reis Inc., multifamily still is viewed as the strongest commercial property sector in today's economy. Alexandra Jackiw, president of the National Apartment Association's Education Institute — which offers professional designations and courses for multifamily professionals — shares insight on how education can affect success in this sector.
How would you say brokers can work best with multifamily owners and developers? I would encourage them to do more due diligence about the company [for which they're seeking] lending. I think it speaks volumes about a company's proficiency as an operator and its ability to keep a property operating optimally if it and its employees are engaged in industry education.
Do employees have certifications that acknowledge their level of expertise in being able to manage a property well? That's a key component that I'm not sure [brokers and lenders have] focused on in the past.
What trends are you seeing in terms of industry education? There is some retrenchment in employment in the real estate industry. And people with the best skills and the strongest credentials are the ones that appear to be more protected. I think, more than ever before, education has come to the forefront of our industry as a key component of staying relevant and employable.
How can commercial mortgage brokers benefit from the courses the institute offers? We're finding that a lot of [property-] owners need the experience of people who know the financial markets, as they look at refinancing and loan modifications or workouts.
In a class [for] the Certified Apartment Portfolio Supervisor designation, which is aimed at middle-management level and above, [there were] many [attendees] affiliated tangentially with the [apartment] industry because they were brokers or otherwise involved on the finance side.
How do its principals' education and certifications affect a multifamily property's success? On a [net-operating-income (NOI)]-per-unit basis, when comparing like-properties that have few variables between them [except for] the skill set of the property's manager and maintenance supervisor, I've been able to prove year over year over year that a property run by individuals who have industry training, certifications and designations outperforms properties where that is not the case.
In some instances, it's been as high as $300 to $400 per unit in NOI, which in our business is directly related to the value of the real estate.
Ivanna C. Sukkar is senior associate editor at Scotsman Guide. Reach her at (800) 297-6061 or firstname.lastname@example.org.