Whether you're an executive of a multinational corporation or a cashier at the local supermarket, you probably receive a performance evaluation that assesses how well you're doing your job. Many property management companies may also do regular assessments of their employees’ performance. But when it comes to a board’s assessment of its manager, forget about annual performance reviews, it’s game on every month.
“Every month when you show up at a board meeting, your performance review is done right there,” said Josh Koppel, CPM, president of H.S.C. Management Corp. in Yonkers. “If you are not doing your job, the board will know it pretty quickly. In this job, you can’t fall asleep at the wheel.”
Carl Borenstein, president of Veritas Property Management in Manhattan, agrees that vetting a property manager's performance is fairly cut and dry. “Realistically, most boards would be able to rate managers by things like shareholder complaints. At board meetings, are there new items, or are the same projects coming up month after month? Is the manager being responsive, and showing the ability to get jobs done on time and on or under budget?”
For example, at the last board meeting of one fictional building, property manager Tony was given a list of things he was required to get done, including several building repairs, financial reports that needed to be written and submitted, and three estimates he needed to get for a capital improvement project that the board was contemplating. One month later, Tony sat down at the meeting and only had a few of those items crossed off his list. He still had not finished several repairs, including one minor plumbing leak that, due to his neglect, had gotten worse and caused additional property damage.
In the meantime, the board is not happy and now has even more things it wants to add to Tony’s ever-growing list. In this case, the board doesn’t need to wait a year to assess Tony’s performance. It’s clear that he’s not accomplishing his workload and is chronically behind. The board decides to make a change.
Jeffrey Friedman, president of Manhattan’s Vintage Real Estate, Ltd., agrees that a managing agent is evaluated all the time, but says that a board should not follow through with a sudden personnel change unless there is a real problem with the manager’s performance.
“Unless there’s an issue that comes up that indicates a managing agent hasn’t done their job, then there isn’t really any reason to look around for something better,” he says. “If it isn’t broken why fix it?”
Criticism of a manager’s performance can actually be a learning experience for all involved. Even Winston Churchill touted the benefits of criticism and performance by saying, “Criticism may not be agreeable, but it is necessary. It fulfills the same function as pain in the human body. It calls attention to an unhealthy state of things.”
“Boards have to be real and come to the manager and the person who runs the management company and tell us what you’re not happy with,” says Koppel. “Criticism is welcome, it makes you better. Managers also have to be open minded. You can learn from the porter and the doorman and pretty much anyone. Any way it comes to you, look at it and digest it and turn it into a learning experience.”
When a performance review is completed, whether it be a formal, annual review or an on-the-spot informal monthly critique, and there are potential red flags and sub-par performance, the issues should be addressed between the board and the management before any final management changes are made.
“If I have a board who is not happy with an agent, I find out what the board’s issues are and I speak to my agent and correct them,” says Koppel. “Let’s try to work it out as a team and, if that fails, we will then replace the agent. If we can’t sit down and work it out maybe there’s a personal issue. But until you sit down and work it out and see issues, you don’t know. The only thing you can do is communicate.”
However, communication about job performance should begin way before the manager even begins to manage, and not at a performance evaluation. A board should make certain that the manager has a clear indication of the board’s expectations when she begins the job so it will help her to actually do the job.
“What is their role?” says Margie Russell, executive director of the New York Association of Realty Managers (NYARM). “Also, a property manager should know what they have done to increase the individual net worth of the individual co-op or condo owner. Brokers know what the good buildings are and what makes them a good building. Is the staff responsible? Is the lobby upgraded? Is there dust all over the place? Management’s main job is telling the board how to spend money to keep the property upgraded. They have to be able to articulate what needs to be done.”
At the same time, it’s important for the board to articulate their needs too, so the manager can meet those needs and perform well. Friedman remembers one colleague’s story of one a board that wanted to change managers, but they didn’t say why, leaving his peer’s management company befuddled as to how to fix the problem.
“The management company was told the board wanted something new, but what?” says Friedman. “Was it something high tech and the company couldn’t provide it? Was it something else that the management company could fix or find out how to do for them? Who knows? Sometimes the heat is running and the roof is not leaking and that’s still not enough to say that the manager isn’t doing his job. Sometimes it even starts off as something personal, but the board has to articulate what the problem is with the performance.”
Ideally, expectations for managers should be laid out and agreed to during the hiring process, says Borenstein, such as “expected time of response for calls or emails. What does 'same day' mean? What if someone calls at 4:30? Most boards agree that a 24-hour response time is reasonable, unless it's an emergency.”
Personalities Sometimes Clash
Performance can also be directly related to a personality clash. “Personality is a big part of communication and performance,” says Koppel. “If you can’t speak to a board member, where’s the relationship? There’s no teamwork if you can’t communicate and then everything will fall apart.”
To prevent this from happening, Koppel says it’s key for managers to just stay on top of their to-do list and forget about the evaluations. “When you go to a board meeting and leave with a list of 30 things to do, don’t wait for the next board meeting to get them done,” he says. “Get them done the next day, otherwise you forget and then 30 things turn into 60 and then 90 because it’s nonstop. I work like a dog and I’m on top of my stuff and I enjoy what I do, so it’s easy and I like to get things done.”
“My director of management requires that each property manager submit a meeting report after each board meeting so we can properly monitor the activities of that building,” says John D. Wolf, president of Alexander Wolf & Company in Plainview. “It addresses any major issues that are happening in the building; concerns regarding interaction with board members. Major projects are broken down, and any issues related between three major departments; my bookkeeping department, my legal department and my management department. Those reports are submitted along with the minutes within 24 hours of a board meeting. Upper management reviews them and meets with the property manager on any issues that need to be addressed.”
“Our managers are given certain types of reports they have to do on a regular basis,” adds Michael Berenson, president of AKAM Associates. in Manhattan. “They have to do a monthly walk-through report and they have to give it to the client and to their supervisor. They also have to do a detailed, comprehensive action list. It’s a to-do list of all the items they are working on with a status report and it goes to our client and to their supervisor. Those are two ways we make sure that our property managers are doing their job. It’s also important for upper management to follow up to make sure that they are working on these things for the client.”
In an ideal world, managers should be just like Koppel and give all of their efforts to performing at maximum peak at all times. However, some management companies may dangle a carrot in front of their employees in order to get the best performance out of them. For example, some management companies offer pay bonuses to their employees, whether quarterly, project-based, or annually, to encourage managers to meet specific performance requirements. Some non-financial incentives may include time off, such as additional paid vacation or days off, or such items as education reimbursement or assistance on books, supplies, or tuition.
In addition to incentives, there are other methods and resources that managers can use to perform better on the job and improve their skills. “Are you using all of your resources available to you to do your job?” asks Russell.
For example, NYARM is an educational program that provides articles, conferences, monthly meetings, seminars and more to help property managers improve job performance. The Cooperator provides informational articles and a database of previous issues that cover everything property managers need to know to do their job well.
There are also trade organizations such as the Institute of Real Estate Management and schools that offer continuing education classes and conferences. These resources help managers to learn new skills, improve old skills and ultimately improve performance on the job. Then, no matter when the manager is under the scrutiny of a performance review, the manager will be ready.
Lisa Iannucci is a freelance writer and a frequent contributor to The Cooperator. Associate Editor Tom Lisi contributed to this article.