It’s taboo to be critical of our residents, but the reality is residents create logistical challenges every day for properties by just living their lives.
On any given day, a typical Class A property can have as many as 100 different service providers arriving onsite to deliver goods and services. Every one of these service providers is a potential liability to your community. Did Alex in unit 432 perform a seven-year federal background check on his dog walker? Or did Lindsey in unit 163 check her housekeeper’s certificate of insurance? Not likely.
When multifamily communities offer lifestyle services – like housekeeping, pet care and dry cleaning – they’re providing invaluable and much-appreciated help to busy residents. These hospitality-like services are powerful ways to create resident loyalty and pave the way for high renewal rates.
But lining up service providers to serve residents isn’t without risk. If an apartment community doesn’t have a way to thoroughly vet and screen potential vendors, they could open themselves up to a world of trouble.
Here are three major risks posed by inadequately vetted lifestyle-service providers:
1) Brand damage. Service providers who dress sloppily or carry their equipment around in a trash bag while onsite can be off-putting to residents. These may seem like minor matters, but they can certainly lead to a less-than-ideal experience for renters and make them feel poorly about your community and company.
2) Liability. Few things are more important when vetting service providers than making sure they are bonded, background checked and insured. If something happens onsite and a vendor doesn’t have the necessary protections in place, the property is likely to be named in a lawsuit. If a vendor without sufficient auto coverage is driving through your parking garage and hits a resident’s car or, even worse, another person, the party with the deepest pockets makes the biggest target. No surprise here: that is typically the property, not the vendor.
3) Inadequate service. There’s a wide range of professionalism among service providers. For example, many dog walkers are part-time workers. They walk dogs when they’re not in class or studying, and sometimes they work somewhere else.
This may not strike you as a big deal at first, but what happens when a dog bites somebody in your lobby? A professional dog walker knows how to manage challenging situations, but a college student most likely doesn't. A professional also knows canine CPR and how to handle any sudden medical emergencies.
Property managers need to ensure that the providers they endorse, either through a services partner or through a flier curated by the leasing team, are truly professionals that have the skills and experience needed to provide residents with an optimal experience. And multifamily companies also need to make sure vendors have processes in place to hold employees accountable when the service is inadequate, or they do something wrong on the property.
Communities should keep in mind the benefit of using a third party to organize and manage the offering of lifestyle services. Be aware that they are not all created equal. The right company will handle the vetting process and make sure each service provider that arrives at a community is licensed, bonded and insured. They will perform background checks on companies and make sure the providers are trained and meet high quality-control standards.
The right company will take it one step further and work with small businesses who have a stake in long-term success versus working with independent contractors who may view your property as a path to extra cash flow in the short-term. This will result in a better resident experience, of course, and give apartment communities the peace of mind they want.