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Weekly UpdatesIT WAS ELECTION DAY AND PROPERTY MANAGER MICHELE HITE'S OFFICE AT CHANNELWOOD VILLAGE WAS FIELDING CALL AFTER CALL FROM PEOPLE ASKING WHERE TO VOTE.
In previous years, Channelwood had a polling place on site. Located in Akron, Ohio, the Alpha Phi Alpha Homes development contains a mix of townhouses and garden apartments with some residents receiving government subsidies and others paying market-rate rents. Hite, her assistant and the receptionist spent much of their day referring people to the county Board of Elections to figure out their new polling place.
Hite's to-do list was long that day. She worked on a review for "one of the many government agencies" keeping tabs on the development, distributed 12 three-day eviction notices, collected rents, checked billing discrepancies and performed an internal apartment inspection (a supplement to the five conducted annually by outside agencies).
It was a fairly normal day.
Managing a mixed-income property is not for the faint of heart. Hite said that if she could give one piece of advice to a new manager at such a property it would be, "Take a deep breath and hold on."
It's not just that some developments require a company be certified by the U.S. Department of Housing and Urban Development (HUD) in order to run them, It's that property managers at mixed-income communities handle all the same tasks as their colleagues at standard residential developments, plus a host of additional responsibilities that call for exceptional versatility and skill. They must possess the tact of a diplomat, the understanding of a social worker and a bureaucrat's ability to wrestle paperwork to the ground. It also helps to have lots of energy.
Not everyone is suited for it, said Gayle Epp, a consultant at EJP Consulting Group and an expert on housing issues.
"There are some who love to do this work, and others who wouldn't touch it," she said.
MODEL MIX
The first mixed-income communities opened their doors in the 1970s. The properties can be structured in many ways. Units reserved for low-income residents can go to people with income as high as 80 percent of the area median income, or to former residents of public housing, depending on the development. They can be financed with municipal, state or federal money, and sometimes the dollars come as tax credits or low-interest loans. But despite the variety of set-ups, most mixed-income developments share a common purpose--they are designed to counter the concentration of troubled, low-income households within certain urban neighborhoods by providing quality housing for poor and working-class people alongside homes occupied by more affluent neighbors.
The mixed-income model, coupled with rent subsidies for use in the private market, came to dominate national housing policy in the 1990s. Congress created the HOPE VI program in 1992 to respond to the needs of public housing residents who lived in dilapidated apartments in neighborhoods oppressed by drugs and gang violence. The program offered money to housing authorities around the country that wanted to demolish broken-down public housing units and rebuild. HUD distributed $5.8 billion among 166 cities between 1993 and 2005, and in many cases they used it to build mixed-income communities.
DUTY AND DEMOGRAPHICS
The managers charged with tending these mixed-income communities share many duties with managers at market rate residential buildings. Their first responsibility is leasing the property's units. But the fact that they're targeting at least two, and sometimes three different economic groups, changes their approach.
Sandra Cipollone, CPM[R], is a senior vice president at Interstate Realty Management, AMO, a New Jersey-based company with more than 200 residential properties across the country, including between 15 and 20 mixed-income communities. Cipollone's 45-property portfolio includes six HOPE VI sites. Finding low-income residents is easy, she said. The local housing authority maintains a waiting list. As she gets vacancies, they send her people to fill them.
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Attracting market-rate renters can be more difficult. She advertises in the local newspaper, displays "For Rent" banners on the site and makes brochures available. But not everyone who can afford to pay market rates wants to live next door to someone who can't.
Property managers must decide how much to emphasize the community's mixed demographics, but it's important that market-rate renters and homeowners understand the community's character before they move in, or they may not stay long, Cipollone said.
The maintenance of mixed-income communities, whether routine, preventive or emergency, also falls to property managers, as it would anywhere. Mixed-income properties don't have any special maintenance needs per se, but they often do have additional amenities which require care. Developers often add pools and gyms to help attract market-rate residents, or there might be a neighborhood center or computer lab to benefit low-income residents.
PAPER TRAIL
The difference between managing a mixed-income community and managing a market-rate building is the amount of paperwork required.
Welch Plaza, a Seattle project operated by Lorig Management Services, AMO, comprises 162 apartments, a quarter of which are reserved for people who make less than 80 percent of Seattle's median income. Seven apartments go to residents who make less than half the median income.
To build those affordable units, Seattle's Office of Housing gave Lorig's development arm a 10-year property tax abatement and a low-interest loan. The office wants to ensure the money is used to house people who need help, so Lorig must document the income of residents living in affordable units and furnish it to the city, along with a rent schedule. The rents themselves fluctuate so they never exceed one third of a resident's income. And as residents move in and out, the property manager must make sure that at all times the mix of residents at Welch Plaza meets the terms of the property's tax abatement and loan.
"There's a lot not to forget," said Barry Blanton, CPM, and president of Lorig Management Services.
In addition to running the usual credit and criminal background checks conducted at any residential building, managers at mixed-income sites must certify applicants' income. Often when people change jobs, they must be recertified to ensure they are still eligible to live in the development. At Channelwood Village, Hite processes an average of 50 income recertifications a month. Annual recertifications in the late fall push it as high as 80 a month.
Sometimes the government agency overseeing the project prefers the information electronically, even if there's no way to transfer it easily, Cipollone said. In those cases property managers enter residents' information into their own systems and then key it into the agency's system, effectively doubling their work load.
On top of the paperwork there are the inspections. Channelwood Village hosts inspectors each year from HUD's Real Estate Assessment Center, the Assisted Housing Services Corporation, Ohio Finance Housing Agency, Ohio Capital Corporation for Housing and the city of Akron. Cipollone deals with three or four inspections a year at her properties. Since each can take 30 days to prepare for, her site managers spend between a third and a quarter of the year prepping. She likes to dream about the agencies developing a single, universally accepted inspection process.
SOCIAL SCENE
Mixed-income communities often provide social services that wouldn't be available at a standard development. McCormack Baron Ragan in St. Louis manages mixed-income properties in 19 states, and the company's Vice President, Claudia Brodie, said it is important for property managers to meet with owners before signing a contract to establish the owner's expectations for the site, and then square them with the reality of the budget.
Ideally, mixed-income communities generate enough rent that, after paying rent, utilities and payroll, there's enough left over to hire a social services coordinator, Brodie said. A social services coordinator can organize after-school programs for neighborhood children, train low-income residents to use computers, help people find childcare--whatever residents need.
If there's not enough money for an on-site coordinator, property managers refer residents to nonprofits in the community. They also partner with local players. At a McCormack Baron Ragan property in St. Louis, for example, students from Washington University's social work school do internships at the site.
"We in the property management business don't see ourselves as social service providers," Brodie said. "We want to hook up with someone [else] who does it."
Property managers are generally responsible for enforcing social norms, such as ensuring apartments are cared for. Hite said she's had to teach a few people about cleaning their stoves, as "grease and open flames don't get along," for example. Punitive measures can be used, but Brodie said they try to temper those measures by offering help. For example, if a teenager is dealing drugs from a grandparent's home, the manager might write up the violation but also link the grandparent to a social worker who could help resolve the situation.
"We make sure that we're working it from both ends," Brodie said.
Because they are on site every day, property managers can alert owners to potential problems. Brodie cited the problem of seniors aging. If men and women who moved into an apartment at age 65 are, a decade later, starting to fall in their apartments or suffering from loneliness following their spouses' deaths, a property manager might recommend hiring a senior services coordinator to address these issues, thus heading off turnover and vacancies.
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