Drivers of Resident Economic Health & Mobility
Patrick Richard, CEO of Stoneweg US
Patrick Richard has led Stoneweg US’s exponential growth, reaching a portfolio of value of over $2.1 billion and nearly 19,000 units. Acting with integrity and committing to an ESG-focused investment strategy, Patrick places the utmost priority on generating value for stakeholders and establishing the firm as a premiere investment partner. Over the last eight years, he has also prioritized and implemented an enhanced reporting structure to supply clear and transparent reporting to all partners and stakeholders.
Thomas Stanchak, Managing Director of Sustainability, Stoneweg US
Tom Stanchak has demonstrated hugely impactful operational leadership at Stoneweg US. In 2020, he began focusing his efforts on implementing various energy-efficient and innovative practices to his portfolio by introducing water use conservation, LED retrofits, and effective recycling methods that would not only incorporate sustainability, but also provide key value-add for residents. He is now the company’s Managing Director of Sustainability due to his success and influence in reshaping the company’s ESG strategy.
What do you see as the main drivers of economic health and mobility in multifamily residents?
Patrick and Tom: At Stoneweg US, we take a holistic and long-term view of our investments, focusing on net outcomes rather than gross potentials, which often amount to speculation without a solid underlying strategy. This approach is fundamentally a question of the drivers of the economics of workforce multifamily. The main drivers of economic health and mobility for multifamily residents are access to good jobs, affordable housing, and quality education.
We have observed that the U.S. market consistently demonstrates resilience in terms of employment and wage growth in a global context over the long term. In simple terms, quality employment means people can not only pay their rent but also have an opportunity to save for the future and potentially invest in the same communities where we see so much potential for growth.
Market-rate affordable housing means rents that are attainable based on what working people and families actually earn. We pay a lot of attention to this aspect of the economics of where we invest.
Finally, education opens doors to better job opportunities, allowing residents to improve their economic situation over time. As institutional real estate investors, we often overlook that our success is tied to property taxes, which in many cases, are the primary funding source for public schools. Good stewardship as a landlord can benefit all parties. It requires courage and grit from the investment manager to rigorously examine outcomes and constantly seek opportunities for improvement.
What are some best practices for multifamily owners and operators who are looking to improve their residents’ health and mobility?
Patrick and Tom: As institutional real estate investors, Stoneweg US’s goal is to enhance property value. One of the most effective ways to accomplish this is by promoting resident well-being in a practical and authentic manner.
We believe that affordable housing attainable to working people builds resilience for investors. Keeping rents at a market rate that working families can afford ensures stability, reduces turnover, and minimizes vacancy rates, all of which protect our revenue stream.
We focus on offering health and wellness amenities. By providing practical features like good-quality fitness centers, walking paths, and playgrounds for children, we attract health-conscious residents and enhance the overall appeal of our properties. These investments in amenities not only improve residents’ quality of life but also make our properties more competitive and minimize economic vacancy.
Regular maintenance is another cornerstone of our strategy. It may seem obvious, but it’s easier said than done. Ensuring that properties are safe, clean, and well-maintained prevents larger issues down the line, keeps residents satisfied, and maintains property values. Prompt repairs and consistent upkeep demonstrate good stewardship and protect our investment. In the context of marketing assets, this approach insulates against a re-trade eroding your accrued market value.
We provide a sufficient budget for every community to regularly host events and foster a community atmosphere. We want residents to feel like they are home and that they belong. Engaged residents are more likely to stay long-term, reducing turnover costs and contributing to a stable rental income.
Lastly, we prioritize sustainability initiatives. Implementing energy-efficient solutions and green practices not only reduces operating costs but also appeals to eco-conscious potential residents. This makes our properties more attractive and meets the growing demand in tomorrow’s marketplace.
Our practical approach improves resident satisfaction and retention, which leads to higher property values and better investment returns. This strategy aligns our financial goals with responsible stewardship, benefiting both our investors and the communities we serve.
Are there pitfalls to avoid in this pursuit?
Patrick and Tom: Don’t neglect resident feedback. Listen to the people your investments serve. Dissatisfaction is just another measure of higher vacancy loss, turnover, and operating expenses. Creating environments that meet residents’ needs leads to greater satisfaction and stability.
Failing to maintain your investment properties is another pitfall. Consistent upkeep and prompt, appropriate repairs are always a good investment, ensuring properties remain safe and attractive.
Overcomplicating amenities is a common mistake. Keep things simple and invest in high-quality, durable features like fitness centers and pet-care facilities that add real value.
Think about climate change. Stoneweg US recognizes its long-term impacts and opportunities. Building resilience through sustainable practices protects our investments and enhances their appeal. Energy-efficient solutions and green practices reduce operating costs and will meet the growing demand from tomorrow’s market.
For our residents, these practices mean stable, healthy, and enjoyable living environments. Affordable, well-maintained housing with practical amenities improves their quality of life and financial stability. This is fundamentally our approach to sustainability. We seek to create a positive feedback loop where residents thrive, and our investments outperform.
Anything else you would like to add?
Patrick and Tom: At Stoneweg US, our commitment to creating thriving communities goes hand in hand with our mission to deliver strong investment returns. We believe that when we invest in the well-being of our residents, we create a foundation for long-term success. Our focus on affordable, market-rate housing, high-quality amenities, and regular property maintenance ensures stability and satisfaction among residents, reducing turnover and vacancy rates.
We also understand the importance of sustainability in today’s world. By implementing energy-efficient solutions and green practices, we not only reduce operating costs but also future-proof our investments against the growing demand for eco-friendly living options. This approach aligns with our long-term vision and helps us build resilience in our portfolio.
Listening to our residents and responding to their needs is key to our strategy. It’s not just about providing a place to live; it’s about creating a community where people feel at home, supported, and valued. Engaging with our residents through regular feedback and community events fosters a sense of belonging and ensures we continuously improve our offerings.
Stoneweg US’s holistic and thoughtful approach to multifamily real estate investing is designed to benefit both our investors and the communities we serve. By focusing on net outcomes, sustainability, and resident well-being, we create a positive feedback loop that enhances property values and delivers better investment returns. This strategy is not only practical but also demonstrates our commitment to being responsible stewards of our investments and our communities.