The crew spent a majority of its time on exterior upgrades. The largest task was the replacement of damaged wooden catwalk railings with a powder-coated steel system. The new railings not only cured serious structural and code problems, but also opened up the look and feel of the entire property, says Dworetzky.
Other major changes include swapping rotting wooden siding with vinyl Dutch-lap siding, implementing major storm drainage corrections, adding increased lighting throughout the property, and making roof repairs. Inside, approximately $500,000 was spent updating carpet, appliances, and hardware to give the units a fresh look. “The change is striking,” says Cindy Wellner, a regional manager for Harbor Group Management, a division of Harbor Group International. “Our competitors have even said to us, ‘We can’t believe what a difference you have made at the property.'”
Harbor Group also dramatically improved the amenity package. An attic on the top floor of the leasing center was transformed into a much-needed clubhouse complete with hardwood floors, a pool table, and a big-screen TV. And the new owner added a centralized mail center replacing mailboxes scattered throughout the property. “It cleans up the property,” says Dworetzky. “If you have 400 residents and 400 mailboxes [scattered about], you can imagine how much trash that can generate.”
Pardon the Dust
At one point, as many as 60 construction staffers worked on site at the same time. But amazingly, no residents were displaced during the entire renovation process. “That really speaks volumes about the team effort and communication between the site staff, contractors, and residents,” says Dworetzky.
Indeed. Harbor Group’s management arm constantly provided residents with construction updates via meetings and newsletter announcements. Plus, a finish board in the leasing office showed before and projected after images of the property, along with a timeline of the construction process.
Harbor Group’s meticulous planning is paying off. To date, post-renovation rents increased by as much as 12 percent. Of course, the success of the capital improvements can’t be fully measured until the company sells the property, most likely after its typical three- to five-year holding period or when the market presents an opportunity. “The real test of how well we added value comes when we exit the deal,” says Dworetzky. “I’ll know we deployed our capital effectively when a sale yields a strong return.”