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Whether you need to lease-up a 100-unit building or 500 units of new construction, a successful preleasing campaign brings in more move-ins and revenue than the developer and owner may have originally projected. Preleasing helps a property lease units before they have “turned,” or finished with construction. And when managed properly, the leasing team can ensure heavy occupancy during a property’s first 30 days of operation to generate income much sooner and maximize revenue, in large part due to earlier compounding rent payments.
However, there is a balancing act involved in a rapid lease-up campaign. Accurate pricing and leasing strategy are critical. If preleasing is slow, it could mean the rents are too high, additional concessions are required or the team simply doesn’t have the tools to instill confidence with prospective renters. If preleasing is too fast, it could mean demand is higher than expected, pricing is too low, concessions are not necessary or the leasing team has everything they need to get the application submitted. It’s equally important to lease apartments as it is to ensure dollars are not being left on the table.
Developers and owners need to find the balance of achieving solid velocity while maintaining the highest possible price per square foot. Here are four tips to a more successful preleasing campaign.
Engage The Most Interested Renters
There is always going to be a group of potential renters wanting first access to the property and/or willing to apply for an apartment even before seeing it. This starts with a thoughtful and engaging preleasing marketing campaign seeding renderings, photos and insider information about the property. There is often an opportunity to launch a pre-leasing campaign with an event, especially for those who have shown their commitment and excitement for the property. This is also a great way to gauge potential tenants’ pricing tolerance and which units will be most in demand.
‘Seeing’ Units Drives Leases
The average renter is significantly less likely to sign a lease from seeing a rendering than they are from seeing high-resolution photography and/or a 3D walkthrough. If showings during construction are not possible, expedite at least one model for actual unit photography and 3D Matterport virtual-reality walkthroughs, replacing renderings. This gives prospective residents the confidence to lease an apartment without physically seeing the space. A rendering of an apartment does not tell the full story of the textures and finishes. It is critical that the leasing team has enough information to lease an apartment without a potential tenant having to set foot in the space.
Don’t Skimp On Photography
Take photos of views from every possible vantage point. In preleasing, the leasing team essentially stitches a traditional showing together with photos, renderings, floor plans and whatever tools can help paint the picture. If a prospective resident is on the fence about a lower or higher floor, having the photos of the view from that apartment will help move the needle. You can take it a step further with virtual reality walkthroughs of the amenity spaces and common areas.
Showing Path Is Crucial
If showings are possible during construction, map out the best path from the exterior of the building to the model units, staying as clear of construction as possible. Prospective renters can be turned off by seeing the building being worked on, the noise and the mess. Schedule tours during construction after 3:00 p.m. when most of the construction team tends to leave for the day.
A properly planned and well-executed preleasing environment can ensure the long-term success of a multifamily development. Whether it involves utilizing VR, expediting model units or conducting hard-hat tours, there are many ways to have a successful preleasing campaign.