Increasing Apartment NOI Now and in the Future

Every business experiences ups and downs. The regular rhythms of an industry are simply a part of the game.

Whether we like it or not, it seems like everyone becomes accustomed to the change in traffic associated with the year’s slow seasons. Not only is it a dependable gauge to work with, but it also represents a logical downturn of business. While it’s certain that no CRE professional is happy about the seasonal drop in demand, it’s not a sink-or-swim situation.

But, what happens when this schedule is thrown out of whack?

As a result of the pandemic, net operating income (NOI) has reached a considerable low for the apartment sector. This sluggish period for multifamily was largely unexpected as it largely deviated from the apartment sector’s seasonal trajectory.

In a period when the ban on evictions plummeted rent collections to astonishing lows at the same time that CRE’s operational costs increased, NOI took a serious hit – and even worse, it all happened in the blink of an eye.

Today’s case is an extreme example of a slow-growing NOI market, and by learning strategies to combat this decline, the multifamily sector can boost their resilience and find victory amid difficulties.

Here are 5 strategies to increase NOI in multifamily properties during moments of slow growth:

Get Serious About Filling Occupancies

Regardless of the market outlook, gaps in occupancy are preventing multifamily assets from generating their maximum returns. In times of slow growth, multifamily operators should get serious about their building’s vacancy rates as a first-response tactic.

Invest in Leasing

Once you’ve zoomed in on occupancy, it’s time to invest in leasing and marketing. Funneling leads towards your active apartment listings is key when NOI starts to dip, and a great way to do this is by personalizing the prospect experience.

Engaging at a one-on-one level provides leasing agent’s the chance to find the perfect vacancy in the building that fulfills the tenant requirements by encouraging them to tour multiple units.

Don’t Be Shy to Bolster Rent

While it’s not always wise to dramatically adjust rent margins, don’t be shy to make necessary changes. When the apartment community is seeing a significant dip in NOI, there’s no reason not to increase returns wherever possible.

Since rent is the primary factor driving NOI for multifamily, that’s the first place to look when considering profit-boosting strategies.

Screen Tenants Wisely

When so much of your asset’s success relies on timely and full rent collections, tenant screening is more important during periods of lagging NOI than usual. Reports indicate that tenant fraud has increased during the pandemic, making it even more important to maintain a diligent and astute tenant screening process that leverages technology.

Cut Down Costs

Being economic isn’t impossible – it merely requires a close look at any areas where your apartment complex may be unnecessarily cutting into profits. Double-check the books to see where you’re wasting, overspending, or employing detractive operations.

Consider these 5 strategies to assist in supporting apartment NOI both now and in the future.


6 Must-Read Books on Real Estate Investing

Investors, need to restock your CRE library? Whether you’re looking to get expert advice, learn something from the pros, or pick up a few new strategies; investors can’t go wrong with a great read.

Here’s a list of the 6 best books on real estate investing:

1. Mastering the Art of Commercial Real Estate: How to Successfully Build Wealth and Grow Passive Income from Your Rental Properties
by Doug Marshall

In his popular book, Doug Marshall masterfully outlines the commercial investment process.

Marshall shows readers the ropes and even shares his six best tips on maintaining profitable assets. Reading this book will give you insight into when it’s best to move forward with a deal – and also when it’s a good idea to pass.

We love this book because it’s direct, straightforward, and incredibly insightful.

2. More than Cashflow: The Risks and Rewards of Profitable Real Estate Investing by Julie Broad

Don’t think that investment is all fun and games – it’s an industry that comes with its fair share of risks.

Julie Broad is reminding us all of the honest realities of commercial real estate investment and what it means to make it your full-time gig. Both novice and professional investors alike can gain a lot from Broad’s shared stories and advice.

We love how accessible and easy to digest the information is.

3. Long-Distance Real Estate Investing by David Greene

Remote investing poses a large challenge for commercial investors.

Dealing with assets in another state or country is a completely different ball game – but its ability to expand your portfolio makes can make it worth it. Greene is giving readers strategies and tips to navigate through long-distance deals and also pave the way for long term success.

We love how this book addresses a common pain point felt by commercial investors across the board.

4. Real Estate Investing Gone Bad by Phil Pustejovsky

If you’re wondering what not to do during an investment deal, check out Doug Marshall’s book. Real Estate Investing Gone Bad covers 21 true stories about when commercial property deals took a turn for the worst. By learning from others’ mistakes, readers can avoid potential troubles and losses.

We love this book because it portrays real-life examples of the dark side of property investing.

5. The Millionaire Real Estate Investor by Gary Keller

Investors who are looking to maximize profits and establish high returns on your commercial investments will appreciate Gary Keller’s book.

Keller spent years compiling the stories of hundreds of property investors, and the results lie in The Millionaire Real Estate Investor. It’s a must-read for anyone looking for a crash-course on commercial investments.

We love this book for its authenticity and pro-tips to optimize every transaction.

6. The ABCs of Real Estate Investing by Ken Mcelroy

Ken Mcelroy is taking all new investors under his wing in his popular book.

The ABCs provides a basic outline of what you can expect out of real estate investments and how you can set yourself up for success. Readers will get deal-boosting advice that helps to build a strong and stable portfolio.

We love how understandable yet sophisticated this read is.

Happy reading! Which real estate books are on your list?