Caption Drewery Place, an apartment community featuring studio, one-, and two-bedroom apartments in Houston, TX
Overview
As we’ve continued to diversify our portfolio across product types, an area of significant growth has been our residential multifamily management platform. In 2023, the platform grew by 74%, adding 5,585 units across 15 projects in the U.S. and Canada.
“We had a truly breakthrough year in 2023, growing our fee business in multiple regions,” said Senior Vice President – Multifamily Operations Lisa Newton. “As we continue to focus on operational excellence at these incredible properties, helping our partners improve value by elevating the resident experience, I’m excited for the future and look forward to what our teams will accomplish.”
Leveraging Extensive On-the-Ground Expertise
EMME, Chicago
One of the most notable successes was the milestone acquisition of EMME, a high-quality asset located in Chicago’s West Loop submarket, by Hines Global Income Trust (HGIT). Showing our conviction in our multifamily strategy and recognizing the burgeoning demand and rental rates in Chicago, we leveraged our deep boots-on-the-ground operating experience in Chicago multifamily to drive day-one operating savings while elevating hospitality and experience.
EMME is a 14-story, 199-unit Class A multifamily development that is 96% leased. The property includes units with luxury finishes, high-efficiency LED lighting, domestic stone vanities and more. EMME also features resort-style amenities and immediate proximity to West Loop’s boutique fitness studios, dynamic dining scene, upscale grocers, trophy offices and luxury hotels.
The Lumen Playhouse Square, Cleveland, Ohio
We also entered third-party property management at four assets across three regions, driven by the exceptional strength of Hines and the power of having meaningful relationships with our clients.
For example, with The Lumen at Playhouse Square—a 35-story high-rise for the nation’s second-largest theater district—we’d originally been the fee developer when nonprofit owner Playhouse Square wanted to densify and reinvigorate the area by building a residential development on a large garage.
When the project was delivered, the platform was ramping up on equity projects and we weren’t prepared to enter a new market on a third-party management assignment. The project manager, was in close contact with the CEO of Playhouse over the next two years, acting as a sounding board for ideas and issues and offering advice whenever asked. When the existing property manager wasn’t performing, Playhouse reached out to Hines to see if we could help.
Three months in, we’ve so far heard nothing but praise for our management of the asset. The platform has been successful in recruiting and training an entirely new Concierge and Maintenance Team since taking over, implementing standard operating procedures that had previously not existed and creating a far more efficient work environment. We’ve also provided a noticeably positive resident experience with our operations and monthly resident events.
Drewery Place, Houston
Multifamily took over the property management assignment at Drewery Place, a luxury high rise in Houston, in mid-2023, immediately refocusing efforts on aggressive revenue targets and reduced cost reductions. We implemented a comprehensive preventive maintenance program to increase the productivity and reliability of mechanical equipment on site, saving the owner hundreds of thousands of dollars. We also moved to improve the quality of service at the property, hiring top talent and introducing a specialized mobile app for Drewery Place residents to access amenities and personalized services. A $250,000 upgrade of the interior and exterior common areas and amenities is dramatically changing the look and feel of the property, ensuring residents feel like they’re part of a modern, upscale community.
Through these efforts, the team saw significant improvements in profitability and reputation in the first several months of managing Drewery Place. By the end of 2023, per-square-foot lease rates had increased by $0.10, while resident retention was up almost 6% quarter over quarter. Within two months of taking over the assignment, Google Review ratings rose from 3.2 to 3.8 stars, and delinquency was reduced to under 1%. There is still much to achieve, and through strong teamwork, Drewery Place has a solid foundation to accomplish its 2024 goals.
Ambitious Future Targets
With the growth of our platform and our ambitious targets over the next two years—including reaching more than 20,000 units under management by 2025—we are poised to capitalize on the strength of the Hines brand, our unparalleled engineering and operations expertise and bringing a level of service and hospitality that’s desperately needed in a sector where “good enough” has become standard.
To learn more about our residential multifamily management platform, visit:
