SAN DIEGO-NOI growth is not just within landlords' purview. Property managers can also contribute to this important real estate metric and help grow their clients' bottom line, says Joe Greenblatt, San Diego-based president of IREM.

Greenblatt tells GlobeSt.com that when property managers, particularly in the multifamily sector, team with owners to gain maximum operating efficiency from their properties, they can benefit from these gains. "One of the keys is the recognition that this is an income-driven business and that real estate managers now have access to the understanding of real estate investment metrics that have guided asset managers for some time. There's a host of best practices that cascade from that core understanding."

As GlobeSt.com recently reported, real estate, once focused on buying properties that will quickly resell for a profit or buying them for the sake of amassing large portfolios, now has a new focus in order to be successful: NOI growth and adding value to assets. Speakers at February's ULI Orange County/Inland Empire capital-markets event, "The Money Chase," described how the environment for acquisition and yield is changing. "It's going to be all about revenue, not cap-rate compression, when buying properties going forward," said keynote speaker Randy Anderson, head of research for CBRE. "Growth is the most important portion. You don't want to buy when cap rates are high, but when NOI growth is possible."

Greenblatt says the metrics of real estate are moving away from the traditional focus on occupancy in the multifamily space and are more driven by the metrics of income and income growth. "So real estate managers have to respond to that and adjust their focus and priorities. They need to think strategically about driving income growth, not just tactical and strategic expense management."

Some of the best practices Greenblatt mentioned above include sustainability practices that save on energy costs and working with architects to help investors recognize value trapped in an asset, as well as discovering and implementing operational efficiencies.
Also important is providing the services that tenants want to attract and retain them. "Understanding what renters want today is key," says Greenblatt. Practices such as accepting credit cards for rent payment can be a real operational win and far outweigh the minimal expense required to maintain them. "This is low-hanging fruit that gets resistance from some owners, but revenue-management systems are a strategic investment in driving higher income. So are day-to-day things, like practicing reputation management and keeping tenants happy in order to retain them."