Transforming the Resident Experience: Insights from Cortland

Scott Baumberger: Hello and welcome to the creative viz podcast where we discuss topics on architecture development and visual design. Today, I'm thrilled to have Jason Hughes. He is a talent development manager with Cortland and he's based in Houston. Welcome Jason.

Jason Hughes: Thank you.

Scott Baumberger: Great to have you on. So right off the bat explain for us what talent development manager means. What does that look like for you?

Jason Hughes: So a talent development manager within Cortland, what we do is all of our training. It's very up close personal. It's very science and data driven and you're going to learn that about Cortland. Everything we do is based on science and data, which is really, really cool. It's one of the reasons I love working for Cortland. A lot of our training is in person up front and personal on sites at our apartment communities. We can actually walk through the training in depth. We've won awards for our talent development through. Just recently. It's something that we're very proud of.

Scott Baumberger: That's great. I'd love to hear more about Cortland's unique take on both development and property management.

Jason Hughes: Cortland started out strictly a development company. I believe that was 0405 and they decided to bring management in house. That's when they realized that they wanted the best of the best. They wanted the best clubroom facilities. They wanted the nicest fitness centers, the coolest pool areas.

They really decked out their model homes. That's when they were realizing they received a review from a resident. The review read, you can give me all the bells and whistles, but if you can't provide the basics, that's like having all the toppings without the bananas and the ice cream. So, they took that personally because if you look at all new construction, multifamily, everyone has all the bells and whistles. That's when they decided to really focus on the resident experience. That's what really sets us apart from others in this industry.

Jason Hughes: We currently manage over 80, 000 apartment homes. We're very data driven. Our residents actually before their residents, they start getting surveys the moment they tour our community. 7 days after they move in, they get another survey. How was your move-in process because we know that's a huge impression. You receive a next survey 45 days after living with us. You receive a survey after every service request, after every work order. You get another Pulse survey 4 months before your lease expiration. If you decide to move, you get an exit survey. All in all, you're receiving and I haven't looked up the data, a good guesstimate would be your average resident receives 10 to 12 surveys a year times 80, 000.
Scott Baumberger: That's a lot of data and your residents comply? What's the rate of return?

Jason Hughes: It's a pretty heavy return. What we've done is we've taken all that data given by our residents and we put that into Our training, our talent development, we use all of that data. Everything that we get from our residents is how we train our associates on how to treat our residents. So top of the line resident experience.

Scott Baumberger: Love to hear more about that. Walk me through, what are your residents peak concerns? What are you getting back in these surveys? 

Jason Hughes: what we have found the number one, most important thing to our residents is communication. They want a lot of it. Over communication is preferred. Let's give an example. We have to shut the water off of a building in order to do a major plumbing repair. What we're going to do is typically give them a 48 hour notice listen on this day and time. We're not going to do it at 8 AM when people are getting ready for work, but let's say we'll say 10 30 AM on Tuesday, we're going to be shutting the water off. We anticipate it to be shut off for two hours. Please plan accordingly. Then a 24 hour notice, then a two hour notice.

Then let's say we're an hour in and we realize, Hey guys, this is going to take longer. Let's start communicating with them some more. We have, ways of communicating all of them, bulk messages that's what they want so that's what we give. We've actually had to tailor some of our applications so that we can communicate more with bulk communication. 

That's one thing that we've been working on for the past couple of years and we've done that. Of course it's evolving, getting better. That's the number one thing that our customers want. Number 2 is service. I tell my fellow associates, we work where they live.

You have to grasp that we work where they live. This is their home. Of course they want Things taken care of fast, they want them done correctly. They don't want to have to call you back. That's where we focus with our service teams. Number 1, let's get the job done correctly. We don't believe in band aids.

I've worked for companies in the past where I've seen the service manager come in and say okay, I need to order this part and the manager says, we can't. It's not in the budget. We don't believe in that. It is our jobs and our leaders, our community managers and our service managers to manage their budget around it.

Okay, well, we have to have it. Let's see how we can make this happen. We don't believe in band aids. We want to fix it right the 1st time because that's what the customer wants. The 3rd thing that our customers want is parking. They want to be close to their homes. They want to be able to have guests over and not have issues with that. The 4th, thing that they want is safety. They want safety and we don't provide security at the majority of our communities, but that's not what they're talking about. They want adequate lighting. They want to make sure that access controls are working properly.
They want to make sure that you don't have your main entry gate open for 4 days because you haven't repaired it, things like that. What I found really astonishing learning about our residents wants and needs is the fact that number 5 on their list is the actual apartment home. They want all these things before even talking about their actual home. We take all that information and data and we use it with our leadership. How we train them, our customer service, even with our service teams, because they're in their homes daily. They have more interaction with our customers than we do. We take it a step further and train our service teams on that customer service. Then we're training our office associates, the sales strategies to meet the resident experience, which is really cool. I don't know if you can tell, but love my job. 

Scott Baumberger: That's awesome! I'm hearing this and kind of running it through a marketing lens. When we're doing multifamily, we spend so much time on the product and I think that's because it's easy. We can, point ooh, look at this we have marble countertops or the latest tech but you're saying that this is number five on the list. There are things, obviously parking when we talk about safety, there are things about the site, the design, the layout of the building that play into those. But what I'm hearing mostly is that it's really up to the management, the systems that you have in place.

You mentioned communication is number one. That's not necessarily architecture, that's people. When you are marketing or, leasing, what does that messaging look like? Is that something you can speak to?

Jason Hughes: You mean, as far as our sales strategy?

Scott Baumberger: In terms of when you're trying to get new tenants do you focus on the service and on some of the unique systems that you have?

Jason Hughes: Not really. We do have great marketing teams and they know the data. They know what's going on in each individual market. It's not really my forte, but, I do get to talk with them once a week and find out where the hotspots are and then they know which assets to focus on to move budgeted money around to focus on those assets.

In general, like you said, it's kind of hard to market that. However, there are certain things that we do once we get them in the door. For example, we have a 45 day move in guarantee. The first 45 days of your lease, if you have a life change or you've decided, look, this was not the best fit for me. us a 30 day notice and we let you out of your lease. Not many people are doing that. I mean, once you sign that lease, you're locked in. So, we tell that and we use that as a marketing tool. I've told, Prospects point blank. I said, the reason we give you that guarantee and no one else does, is because we're very confident, read our reviews.

We want you to read our competition and reviews. We've gotten such a good reputation that we also allow transfers to any of our Cortland communities. If you're in Idaho and you get a job transfer to Florida, we can help you. You don't have to get out of your lease. We'll take you. Cortland's Cortland.
Scott Baumberger: Nice. 

Jason Hughes: We have some really great stuff.

Scott Baumberger: That's a size kind of matters when it comes to those things. Even within the city, say you're in Houston took a job on the other side of town. It's like, I'm tired of making this commute. Right. 

Jason Hughes: We do it a lot. 

Scott Baumberger: That's really interesting. You mentioned something up front about Cortland that they started out as a development company, but more focused on the management side. What does the proportion look like right now? guys still doing a lot of new development or is the emphasis more on managing the existing properties?

Jason Hughes: I think we might have one development project going in another state, so I'm not 100 percent on right now our focus is acquiring and, doing value add through renovations. And again, changes within the market depending on conditions. Cortland decided to start getting into acquisitions.

They brought design and Cortland build, which is our construction division. They brought all that in house. So we are fully in house. We have Cortland build Cortland design. Then we have our investments teams and then we have our operations teams. So that's 100 percent in house. Right off the bat, our investment teams are underwriting deals daily, looking for deals and when they find something that, once they plug all the numbers and it works and investments approves it we make the deal.

If we're able to close on it a Cortland build and Cortland design come in immediately. Start changing things and putting the Cortland touch on it is what we like to call it. Typically, when they're underwriting it, that's where they're automatically going to find what type of premium we're going to get because of our renovations.

I was talking to investments 1 time, and they were looking at a deal and they had added a 300 dollar, rent up charge. Through that renovation. Like I said sometimes it changes again with the market. I came on with Cortland at the end of 2017 and I had been working for a development company.

It's all he did was develop new product and then they sold it and Cortland acquired us. It was a big package. Now we were already Class a communities, so there was very barely any renovations at all. maybe design came in and redid the club rooms in the offices, but they didn't have to do any And so, at that time, 2017, 2018, that was the perfect opportunity for them to acquire hold fairly invest any money in renovations and now it looks like they're going back to acquiring, renovating, it's always exciting.

Scott Baumberger: Yeah. I can tell. You mentioned the geographic reach, Idaho, Florida , all over. I think you even mentioned, have a number of properties , in the UK as well.
Jason Hughes: That's correct. And now in the UK, it is 100 percent development.

We're developing all of that. We have a great team out there. Cortland is truly changing multifamily in the UK like it's never been done before. the UK, what happens is a developer builds an apartment community and then they start selling off individual units.
Jason Hughes: You may be a package deal to one landlord. Here's 10 units. You manage those. Some will buy one or two. That's the way it's been forever in the UK. We decided to change things up. I saw this beautiful picture of one of our communities. I believe it is 50 stories tall. I believe it's over 500 units.

It's beautiful. It's going to be managed like multifamily is here and is blowing them away. It is very well received because again, we're putting that Cortland touch, adding those beautiful amenities. The customer service the UK you have a landlord that owns 1 unit in a building.

What kind of service do you think you're going to be getting from him? kind of service that we can provide. So we really are changing and I get to see them once a year. We all meet up and it's really cool listening to what's going on there. It's amazing.

Scott Baumberger: And I imagine even within us, it's such a big group. you able to hear what other people are seeing on the ground? Do you get, the wider network of lessons learned from such a big group?

Jason Hughes: Yeah, we do. Number one, we have great communication. Our internet, Everyone's posting live updates and things like that. Our leadership team out of Atlanta's is very good at sharing information. Typically, what we do is once a year, get together with all leadership. That's when we bring all community managers, all service managers, all executives, we all get together and there's some learning involves that some training involved, but we also get all the updates. How Cortlandt's handling investments and how the UK is doing and typically this is towards the end of the year and we all look forward to it's really fun getting to meet managers from Colorado and things like that.

We get everyone together. It's a, really good time.

Scott Baumberger: That sounds great. It sounds like a great company to work for.

Jason Hughes: It is. If you can't tell, I drank the Kool Aid while back.

Scott Baumberger: this has been really great. one thing like to do, with my guests is try to end on a hopeful point. I know things can be really challenging. Not just new development, but, even renovations, just trying to stay ahead of this crazy market that we're in.

Can you share anything with us, to, perk us up? Tell us what's working, what do you see for the rest of 2024.

Jason Hughes: What we've been doing for 2024 is a little bit different than what we have been doing in the past, just because of the market conditions. So the way Cortland works is they put funds together. Their first fund, I believe they ever started was around 30, 40 million. I believe we are on fund six or fund seven.

I'm pretty sure it's six and of course our strategy is getting investors to come in with us. Right now we're sitting on a fund with 1. 5 Billion dollars. They have decided to hold on a minute just because of these market conditions and interest rates. Our strategy this year has been to Dispo some communities based on that investor portfolio. Then we're taking those funds to acquire our new acquisitions. Like I said, I talk to investments all the time because they're literally two cubes over. So I'm always excited to learn what's going on. Hey, do we have anything in the works?

Luckily we do here in our region. We're very excited about that. I think that's just unfortunately these market conditions, that's what a lot of people are doing. Our investors know us and trust us so much that they're willing for it to sit there because their returns have been so good so far.

Scott Baumberger: If you have a longer horizon, it's still a great investment. Absolutely. Fundamentals are still very good. Well, with that, covered a lot of ground today. Thank you so much, Jason. Cortland sounds like really interesting company, definitely one to watch. I appreciate your insights, sharing with us today.

Scott Baumberger: We'll see you next time. Thanks so much.

Jason Hughes: Scott, thanks for having me. Appreciate it.

Scott Baumberger: Oh, you bet. Thank you, Jason.