Measuring Tenant Satisfaction and Retention

© 2011 J.D. Power and Associates, The McGraw-Hill Companies, Inc. All Rights Reserved.

J.D. Power and Associates Proprietary and Confidential—For Internal Use Only

Measuring Tenant Satisfaction and Retention

CFAA

2011 Rental Housing Conference

June 17, 2011

2© 2011 J.D. Power and Associates, The McGraw-Hill Companies, Inc. All Rights Reserved.

About J.D. Power and Associates• Have been conducting research in Canada since

1991 offering several syndicated studies measuring overall satisfaction and quality

• We support hundreds of clients with a range of VOC solutions including:– Syndicated study benchmarking– Proprietary tracking studies– Mystery shopping– Customer handling process consulting and

training

• Our syndicated benchmarking studies have been a catalyst for improvement in a number of industries


Resident Satisfaction Study

• National study conducted among approx. 8,500 residents of participating asset managers

• Paper survey (with online option) – offered in English and French• Provides insight into various aspects of a resident’s experience

through satisfaction ratings, process metrics and verbatim comments


Why Measure Satisfaction in the Multi-Res Industry?

• Your customer’s expectations vary significantly!– By property, location, price-point, etc.– You can’t hope to meet or exceed customer expectations if you

don’t understand them first!

• The experience is on-going not transactional– PM staff are tasked with keeping residents happy at all times– This begins as soon as the lease agreement is signed (maybe

before…)

• Highly satisfied tenants offer the following:– A source of free advertising (through referrals and

recommendations)– Superior loyalty -> lower turnover / cost savings


Reasons for Not Renewing at Current Building

25

25

16

13

12

6

4

0% 20% 40% 60%

Unsatisfied with suite /building

Affordability

Unsatisfied with propertymanager

Buying home

Life change (e.g.marriage, child)

Employment change

Other

Tenant feedback can initiate actions to address these issues before they lead to turnover

Nearly One in Five will Choose Not to Renew their Lease…

Source: J.D. Power and Associates 2010 Canadian Resident Satisfaction StudySM


What’s Important to Residents?Suite quality matters most but the PM staff plays a critical role…

Key Drivers - Long-time Renters

Rental Price / Value9%

Property Management Staff

25%

Suite Quality38%

Building Quality18%

Building Amenities11%

Key Drivers - First-time Renters

Application/Move-in

15%

Building Amenities10%

Building Quality17%

Suite Quality34%

Property Management Staff

18%

Rental Price / Value6%



Where can Managers Influence Change?

• Staff responsibilities cover all aspects of the building – suite, amenities, maintenance, tenant requests, etc.

• Some simple things to consider:– How is a resident greeted?– How is a resident contacted / how do they contact you?– What is the process for resolving tenant issues?– What is the approach to general maintenance and cleanliness?– How can issues be prevented?

• Keep in mind, resident satisfaction will be viewed in the context of all experiences i.e. not just other rental properties


PM Staff is where “the rubber hits the road” – opportunity!

Elite Properties vs. All OthersIndex Point Difference

122

108

144

45

137

134

118

-150 -125 -100 -75 -50 -25 0 25 50 75 100 125 150

Overall

Application / Move-in

Property Mgmt. Staff

Rental Price

Amenities

Building Quality

Suite Quality

Worse Better

Elite vs. All Other Properties

All Others90%

Elite10%

Segmenting PerformanceNot all buildings are in the same class…



Elite 81% 15% 4%All Others 55 28 17

Frequency (%)

Impact of Request Response Time on Satisfaction

742677

571

500

600

700

800

900

1,000

Within 24 hrs 24 to 48 hrs More than 48 hrs

Ove

rall

Satis

fact

ion

Inde

xAre Staff Responding to Maintenance Requests in a Timely Manner?

Satisfaction declines significantly as time passes and no acknowledgement is given.


High Satisfaction Yields Greater Returns

Impact on Satisfaction on Loyalty / Advocacy

2630

40

54

0%

20%

40%

60%

80%

100%

Likelihood to Renew Lease Likelihood to Recommend Building

% D

efin

itely

Will

EliteAll Others


Exceeding residents expectations will lead to significantly higher loyalty and advocacy for your building / brand.


The Voice of Your Residents

• “The building has a great look on the outside, but once inside it is NOT worth the money they ask for. The units are not updated to the standard of the market.”

• “The property managers are doing an exceptional job. They are courteous, respond quickly to requests and are available to help when needed”

• “I would recommend our management place courtesy calls every so often to see if we have any issues and to demonstrate better customer service.”

• “The swimming pool was open for almost 3 weeks before I found out about it. Please post a note in the elevator next year.”

• “Our on-site management staff are fabulous. They are part of the reason why this building feels like home.”


In Summary…

• Property managers are challenged with “keeping residents happy!”

• This task requires managers to pull it all together– General up-keep and maintenance of the building– Addressing tenant issues (functional as well as issues with other

tenants)– Provide a sense of comfort and community

• Process and consistency are key for property managers– Not all buildings are built the same but can they follow the same

procedures?

• Listen to your residents– Having insight into how residents feel and what they expect is only one

piece of the puzzle but is critical to prioritizing improvement actions

© 2011 J.D. Power and Associates, The McGraw-Hill Companies, Inc. All Rights Reserved.

J.D. Power and Associates Proprietary and Confidential—For Internal Use Only

Thank You

Adrian ChungSenior Manager, Canada Real Estate

416.640.9454 | [email protected]

Measuring Tenant Satisfaction and Retention

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