Multifamily Dive’s Small Manager Spotlight series emphasizes the experiences of local property managers, offering insights into the challenges operators face across the nation.
Peter Jakel, a seasoned professional with nearly two decades in the multifamily housing sector, previously honed his skills at Archstone, one of the industry’s renowned names. His journey, however, took a pivotal turn from public relations to property management.
Until recently, Jakel concentrated on communications, first as a manager and later as a director at Archstone. He transitioned to LinnellTaylor Marketing, a multifamily public relations firm, where he served as vice president of strategy during the tumultuous split of its assets post-merger with Equity Residential and AvalonBay Communities in 2013.
In 2021, Jakel boldly entered the property management arena, establishing PMI Aspire in the Denver area. His motivation was dual: to secure retirement income and to address the pressing demand for effective property management. In a short timeframe, he quickly accumulated a management portfolio that boasts approximately 1,300 residential small multifamily and single-family doors, alongside more than 2,000 housing association units in Denver and Boulder County.
“I started with zero doors,” Jakel tells Multifamily Dive. “In just over a year, I grew it to about 165 doors, managing everything in my spare time—weekends and evenings.”
Initially, he focused on single-family rentals but soon diversified by acquiring two 30-unit multifamily properties. His growth strategy included acquiring a Lakewood-based company specializing in housing associations and a small multifamily management firm in Longmont, Colorado. This aggressive expansion allowed him to step into properties managed by special servicers, which significantly boosted his portfolio.
Jakel notes, “I'm gradually moving into class B properties, but many of my current holdings are class C,” emphasizing a keen awareness of the market dynamics.
Addressing Class C Challenges
During a conversation with Multifamily Dive, Jakel delves into the difficulties that accompany class C properties, particularly in the current economic climate. “Vacancy rates are high for these units right now,” he points out, citing a surge in new developments that create stiff competition. “Smaller owners can’t match the incentives that new builds are offering,” he adds, highlighting the strain on class C properties in attracting tenants.
With many new buildings incentivizing sign-ups through generous offers, existing class C properties struggle to maintain their occupancy. “There are those offering nine weeks free rent, which makes it tough for us as smaller owners who can’t afford such concessions,” Jakel explains.
He also points to external factors impacting occupancy, including local enforcement actions by Immigration and Customs Enforcement (ICE), which have contributed to turmoil in specific communities. “Certain areas, particularly in Colorado, have suffered significant vacancy due to such actions,” he candidly remarks.
Rehabilitating and Marketing Properties
Jakel emphasizes property rehabilitation as a strategic priority. “It's about working with owners to set realistic rent levels that climb back toward full occupancy while managing costs effectively,” he states. This requires a meticulous approach to maintenance prioritization while remaining compliant with local regulations. “In Colorado, residents have the right to initiate habitability claims for almost any issue, so we need to respond to those promptly,” he adds.
Managing expenses without compromising living standards is a delicate balance. He often has to delay some non-essential repairs to ensure that owners remain financially stable enough to meet critical payments like mortgages and insurance. “You have to carefully decide what maintenance can be deferred without escalating the risk for owners,” notes Jakel.
Generating interest in properties that are struggling with occupancy requires creativity and determination. “Offering significant concessions is one approach, but we also leverage alternative marketing channels,” he advises. Platforms like Facebook Marketplace and collaborations with organizations like Housing Helpers are effectively utilized to attract leads.
Jakel highlights the importance of having a bilingual staff to cater to diverse community needs, particularly in class C properties. “Being able to communicate with Spanish-speaking residents and prospects has become essential,” he notes.
Future of Property Management
When asked about trends in the property management space, Jakel believes consolidation is on the horizon. “There's a noticeable trend of larger firms acquiring smaller operations,” he observes. With many small owners reaching retirement age and seeking an exit strategy, private equity firms are increasingly eyeing these opportunities for acquisition.
Through Jakel’s experiences, it’s clear that operating in the Denver multifamily market entails navigating not just the competition from new constructions but also addressing the unique hurdles posed by class C properties. His proactive approach to management and strategic acquisitions positions PMI Aspire for continued growth in a dynamic market.
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