Gregory J. Rice is the general manager and vice president of franchise sales for Nexus Property Management, based in downtown Pawtucket. The company services more than 700 rental units in Rhode Island and southeastern Massachusetts.
Nexus Property Management provides landlords with services, including tenant placement, rent collection, maintenance, tenant communication, marketing and 24-hour response services. Nexus, which also offers investment advice, property analysis, and profit forecasts for prospective real estate investors, is also moving forward with residential property development of its own. The company is now redeveloping the Sacred Heart Church at 415 Olo St. in Woonsocket into 32 apartments, buying the property for $510,000 last year from the Roman Catholic Diocese of Providence after it saw its final Mass more than four years ago.
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PBN: What has the demand been like for property management this year and what are the factors driving that demand?
RICE: I have seen the demand for property management from landlords slow down compared to years past. I feel that with the Federal Reserve closing the faucet more and more over the first half of 2023, investors are seeing increasing lending costs, purchase prices, taxes, and day-to-day recurring costs.
It makes services such as Nexus become a luxury or a bonus when it comes to their bottom line. The properties still have the same problems, it’s just the way that the landlords are choosing to handle them now are different by necessity compared to years prior.
PBN: Do most property owners who turn to property management services such as Nexus own many residential units that need to be taken care of? How many units does a property management client usually bring to the table and how does that vary?
RICE: Our most common client typically has one or two multifamily houses. This has been our specialty from day one. We service larger complexes but those are few and far between. We take pride in working with the landlords who are not as experienced and getting them to a point of comfortability. Many of them sign on with one property and as time progresses continue to add more because they see how our model creates time, passive income and leverage for the financial portfolio.
PBN: How important can a good property management service be for retaining tenants? Does the performance of a property management team matter when it comes to retaining tenants? What’s been your experience?
RICE: Tenant screening will make or break you as a landlord. Oddly enough, many landlords put very little weight on this when it comes to renting their units.
We have a screening process that is similar to applying for a mortgage. We have specific ratios and formulas that must be met in order to qualify someone. Yes, it may be just a quote “apartment,” but to that landlord it’s their mortgage and their future.
PBN: Can you tell us the status of some of your real estate development projects, such as the former Sacred Heart Church in Woonsocket? What’s the latest?
RICE: I recently acquired a 22-unit portfolio last week to add to my Woonsocket holdings. I love Woonsocket. The mayor and her team have been absolutely tremendous and over the top when it comes to getting things done up there.
The church has completed its abatement and demolition phase, and as of today framing is underway in the rectory and steel erection was being done inside the church hall. Bentley Builders are on track for the 32 units to be completed by the end of the year.
PBN: What are some of the ways that property management has been evolving? Are there any latest trends or new kinds of efficiencies in property management that you can tell us about? How are property management services improving in 2023?
RICE: It seems that people are understanding that being directly involved with all of their properties and tenants is an “old school” way of doing business. Most see that it does keep costs down, but it also keeps them on a metaphorical ball and chain.
Creating layers inside the business seems to be a growing trend. Whether it’s hiring a full-time manager or subcontracting pieces of the puzzle, landlords understand that it’s best to let a professional, or a software, do the work. Rent collection software has become more popular than ever specifically. No longer are landlords collecting rents in person, and if they are, they are at risk in many ways.
Marc Larocque is a PBN contributing writer.
