Year-One Priorities After Acquiring a Property

The first year of ownership sets the trajectory for the entire hold period. The decisions made in the first 90 days echo for years.

Here are the priorities we work through systematically after every acquisition.

The First 30 Days: Operational Transition

Property management handover. Whether transitioning to in house or to a new third party, the handover requires intensive attention.

Tenant introductions. New ownership letter. New contact information. New maintenance request process.

Vendor introductions. Snow removal. Landscaping. Trash service. Pest control. Each vendor needs to know who their new client is and what the expectations are.

The First 60 Days: Walking Every Unit

Every unit gets inspected within 60 days. Not just the vacant ones. The occupied ones too, with reasonable notice.

Document condition. Note any maintenance issues. Identify any tenant problems we inherited but did not know about.

This is also tenant relationship building. The new owner who shows up personally signals that the property is being actively managed.

The First 90 Days: Expense Audits

Insurance reshop. Get three competing bids. Compare deductibles, coverage limits, and premiums.

Property tax review. Look at recent reassessments. Consider whether an appeal is warranted.

Utility audit. Are we paying for vacant unit utilities. Are common area utilities optimized. Are tenant billbacks set up correctly.

Vendor contracts. Snow removal, landscaping, trash service. Are we paying market rate. Can we consolidate.

Months 4 to 6: Capital Project Planning

Develop the five year capex plan. What needs to be done in year one. What can wait until year two or three.

Get bids on major projects. Roof replacements. HVAC replacements. Common area renovations. Have multiple contractors quote each scope.

Sequence the projects. What needs to happen first to enable other improvements. What can be done in parallel.

Months 6 to 9: Leasing and Rent Strategy

Identify renewal opportunities. Which units have leases coming up. Which tenants are likely to renew. Which are flight risks.

Set rent targets. Where are we positioning the property. What is the value proposition. What is the price.

Implement renewal pricing strategy. Offer renewals 90 to 120 days before expiration. Capture loss to lease at the renewal.

Months 9 to 12: First Year Wrap

Review performance against the underwriting model. Where did we beat. Where did we miss. Why.

Adjust the year two plan based on year one learnings.

Investor reporting. Full year operating results. Major capex completed. Updated business plan. Forward year commentary.

What Sets the Trajectory

Year one execution determines whether the asset is on plan or behind plan for the entire hold. Disciplined first year work compounds. Sloppy first year work compounds too, in the wrong direction.

Sponsors who treat year one with discipline produce the deals that hit pro forma. Sponsors who think year one is just settling in produce the deals that miss.