How to Expand Into a New Market Without Acquisition

The Property Management Show’s audience has grown to about 8,000 downloads a month, with thousands of views on YouTube. So, the intricacies of property management and how to do it right are interesting topics for everyone, especially new entrepreneurs going into the business. The guest we have today has been described as a hardworking hustler. The topic is how to expand into new markets without having to acquire a new property management company. There are multiple episodes on acquisitions that you can go back to. Check out Michael Catalano and Andrew Propst if you want to access their methods for acquiring a management company and expanding into new markets. Today, Brock Forkey is going to talk about a different way to expand into new markets. Brock Forkey Bio Brock has been a lifelong entrepreneur. In grade school, he sold a skateboard in third grade for $80 and offered pet sitting services. When he graduated high school, he went into construction, where he learned about real estate. In 1999, he purchased his first investment property, and by 2001, he owned 80 properties. Now, his property management company is based in Albany and Troy, and they are expanding into Rochester and Buffalo over the next few months.  Managing Owners Rather Than Doors Currently, Brock is managing about $30 million in real estate, which breaks out to 400 doors. Over the next 12 months, he hopes to get to 600 units, and over the next 24 months, 1,000 units. Brock believes it’s better to look at the numbers in terms of owners rather than doors. If you have an owner with 74 properties under management with you, losing that owner is going to hurt a lot more than losing one unit. So, the goal for Brock’s company is to gain 180 owners over the next year, which will hopefully bring in 300 to 400 additional units. This type of strategy allows you to diversify your management portfolio in terms of owners rather than properties.    Shifting Strategies from Sales to Property Management There are a lot of moving parts in property management; more so than in other businesses. Add to that the fact that people have their safety and well-being wrapped up in their properties, and it’s a pretty critical business. Brock began buying and selling real estate, and eventually found himself flipping houses by 2006. Then, the financial landscape changed. People with credit scores in the 500s could get 100 percent financing. Selling homes was profitable. Homes were sold to investors and homeowners. By 2007, it was getting harder to sell anything. Not everyone saw the warning signs – but Brock did, and he made the necessary adjustments to his business model. Knowing when to pivot is an important part of achieving success in real estate and in any entrepreneurial business. It’s like Madonna. Madonna has been relevant for 30 years because she knows how and when to change. You have to be willing to change. Sometimes, you’ll get hit with a brick and that’s how you’ll know it’s time to change. Other times, you’ll see it before the rest of the industry sees it. People might resist where you’re going and what you’re thinking. It’s not because you’re wrong or they’re wrong – they just haven’t seen it yet. If you’re tracking your numbers and you’re following patterns in the industry, you’ll see the shift, and you’ll be able to pivot. Fake it till you Make It: Shifting with Momentum Changing the business model requires preparation and confidence. When Brock moved from sales to management, he spent $3,000 on a phone system that led callers to believe his company had a number of different departments (they didn’t…yet). He sent out some direct mail with a paragraph about their company, some bullet points, and a call to action. People called. People called because there was a need for this type of business.