One Size Does Not Fit All

 

Did you think revenue management was all about revenue? Think again. Revenue management using YieldStar® is also about asset strategy. If you’re planning to stabilize and hold your property long term, revenue maximization may be your goal. Revenue management software was designed originally to support revenue maximization on stable, conventional assets. Using supply and demand statistics, the systems work to optimize occupancy and maintain it at a sustainable level while accelerating rents whenever possible. But the asset lifecycle isn’t that simple. We lease up our properties. Then we recapitalize them. We renovate them. And we ultimately sell them. Revenue management has had to evolve to accommodate all these conditions, from lease up to disposition and everything in between.

In the case of a renovation, you need to be able to take units off line, making sure your exposure isn’t overstated. Then you need to be able to reintroduce those units with the proper amenity values. Then there’s the ROI reporting you need to evaluate whether you’re achieving the returns you expected when you embarked on the renovation in the first place. Since one of Berkshire Property Advisor’s primary business objectives is to redevelop and reposition multifamily properties across the U.S., a core function of YieldStar is to help the company accurately price units post-rehab. “Executing our strategy in this economy requires a much more sophisticated approach to pricing, to ensure that we are consistently getting an acceptable return on our redevelopment capital,” says Dean Holmes, Division Vice President with Berkshire.

And when it’s time to address your debt needs or sell an asset, you need to be able to demonstrate performance trends that will deliver the most favorable terms. In those cases, the market will value your property based on very specific occupancy and rent levels. You need a system that can be configured specifically to achieve those results, as well as a revenue management partner that can provide the guidance necessary during the process. “We have been able to leverage our system and YieldStar’s expert team to achieve the results we wanted during disposition,” says Stephen P. Adams, Senior Vice President of Asset Management with LaSalle, who worked closely with YieldStar recently during the sale of one of his properties on the West coast.

Managing for cash flow is one strategy, but not the only one. Revenue management with YieldStar can support the entire asset lifecycle, from cradle to grave.

 


Group Vice President, Asset Optimization Solutions, RealPage
Janine.Jovanovic@realpage.com

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Janine has over 15 years of experience in helping real estate companies capitalize on the opportunities afforded by innovative technology. As president of YieldStar and MPF Research, she is responsible for delivering RealPage’s revenue management and market intelligence solutions to the multifamily industry. Prior to joining RealPage, Janine was senior vice president of administrative services at JPI Companies and senior manager within KPMG’s real estate consulting practice, working with numerous industry leaders to maximize their organizations’ capabilities through the implementation of technology solutions, combined with business process and organizational redesign. Janine is a passionate advocate for technology within multifamily real estate and is featured often as a thought leader on the subject.

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