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How is residential property management changing?

The property management sector is undergoing huge changes as legislation and regulations, and expectations of residential property management companies and customers, develop. Those responsible for buildings must now grapple with increasingly complex building safety regulations while addressing leasehold reform.

The industry is also facing its own internal challenges as leaders seek to professionalise the sector and create a place people want to choose as a career.

In an article originally published in Property Week, our Managing Director Martin King explains how FirstPort is facing these changes head on and creating opportunities to improve and evolve.

What key areas are affecting the residential property management sector now?

The industry is changing as a whole – client and customer expectations are the main change piece that we are going through. It is developing from a business-to-business network to a business-to-consumer focus.

Right-to-manage (RTM) and residential management companies (RMCs) are all growing, and the biggest change is the prevalence of them. Previously, most development owners would be happy for a professional company to come in and manage the day-to-day maintenance of communal areas. What we are seeing now is more RMCs being formed to take on greater responsibility for more complex areas, such as building and fire safety, which obviously come with quite a bit of burden around them.

There have also been changes around building safety legislation and the regulatory frameworks. The widely reported issues around cladding focused everyone’s attention on building safety. We have invested in a large in-house team to monitor building safety and ensure our properties are up to date with regard to legislation. They also ensure any necessary works are completed in a timely manner. The RMCs we work with value this expertise. They have told us that the support we’ve provided gives them the confidence that critical things won’t slip through the net and we can, together, tackle head on and promptly the challenges this complex environment presents.

It is a fact that remedial works will often come with additional costs. The Property Institute recently produced a Service Charge Index that shows service charges have increased on average by 41% in the last five years, with one of the three main drivers being costs associated with new building safety requirements. It is essential we liaise and communicate with residents sensitively to ensure that they understand increases in charges and have complete transparency.

It is important that we manage building safety, major works and emergency works professionally – all have to be monitored across our portfolio and we also need to minimise disruption for residents. We can support the RMCs that work with us to manage all these issues to stay on the right side of the law.

What challenges and opportunities does this create for FirstPort?

In terms of challenges, building complexity is top of the list. What that means for us is we need to ensure we’ve got the right teams with the right people with the right qualifications, ensuring that those buildings are well maintained and well managed and the residents living in them are as safe as possible.

The opportunity out of that is the chance to communicate that expertise; that we’re able to work with RMCs and their directors and residents to ensure they understand the work goes far beyond mowing the grass and changing small things that are visible.

How is leasehold reform affecting property management?

The leasehold model has, over the past year, been a strong political focus and has put a spotlight on those who work within the system, like property managers.

Now that the Leasehold and Freehold Reform Act (LFRA) has become law, we’re working with The Property Institute, alongside other property managers, to contribute our expertise to the continuing debate and to represent what our industry stands for, showing our trustworthiness and professionalism.

This includes making sure there’s a better understanding of what property managers’ responsibilities are, what the service charge element of management fees consists of and why there are rising prices, ultimately supporting the move to increase transparency across the industry.

With all this change, where do you see FirstPort in the next five years?

The most significant area of change I want to see is professionalisation of our industry to ensure we are more regulated and qualified, we communicate with customers better and we have the right expertise in place to deal with those regulatory changes as they come.

FirstPort has already started to prioritise this, and we are committed to having qualified individuals on our teams. To ensure this, we developed a 12-week first-phase training package – alongside external qualifications –
to make sure everyone on the front line knows their job before they get on site. We’re putting systems in place to provide that training to everyone irrespective of their role.

We want to be an aspirational employer – a marshal in the industry. I don’t think many people at university aspire to become a residential property manager or asset manager, but it’s an exciting area and we want young people to understand that being part of it is interesting and a real career option. I want FirstPort to be seen as the professional leader in real estate management.

How is FirstPort supporting clients through this?

Developing our skills around building safety has been instrumental in helping our RMC customers grapple with their responsibilities. We’re also working with our dedicated client services team to respond quickly to a more switched on B2C customer landscape. This proactive approach prevents the escalation of potential issues. Our people are there and ready to answer any question, even the more difficult, emotive ones.

We also need to adapt as fast as our clients do. One example is the later-living developer Platinum Skies, which is responding to the changing needs of the demographic who want a more active, connected environment far beyond the retirement complexes of the 1980s and 1990s. It’s our job to evolve alongside that.

How do you make sure, amid these industry changes, you are still prioritising customers?

It is important to me that we both listen to customer queries and act on them as quickly as we can. Our local teams on the ground are constantly interacting with customers and we also have dedicated teams in the background who support them to resolve issues. Having a customer services team that is professional and understands the industry enables us to solve problems quickly.

We have also been focused on using technology to our customers’ advantage. We recently launched a new customer relationship management system and it has been created to help us to drive transparent communication. Customers can see in real time exactly what is happening at their properties and report any issues, and there are self-serve options if that’s what is wanted. We all live in a world where constant communication and visibility is key.

How are you empowering your staff to support this approach?

It all comes back to the training and clearly identifying roles and responsibilities, and we set clear KPIs and goals. It’s all about being a professional industry and we’re excited to be at the vanguard of the professionalisation of real estate management.

If you’d like to find out more about the range of residential property management services we provide to clients, click here to contact us.