The Role of Empathy in Tenant Relations: Building Trust and Community
How building trust with your tenants can increase retention rate and grow communities while securing your bottom line
The Role of Empathy in Tenant Relations: Building Trust and Community by Blue Rabbit Group's Co-Owner Miles Chandler
Treating your tenants with true hospitality isn’t just a “feel good” approach to business. Data shows that empathy leads to productivity and profitability.
Empathy: “the action of understanding, being aware of, being sensitive to, and vicariously experiencing the feelings, thoughts, and experience of another” or the ability to imagine this or the capacity to experience it. It does not require a shared or similar experience (Merriam-Webster Dictionary).
These days we often hear it referred to as someone’s emotional intelligence (EI). As property managers, the capacity for empathy is imperative to creating a successful property and thriving community.
Empathy Increases Profitability
Maximized Monthly Income = Maximized Property Value
When multi-family investors consider the value of a property, they consider the competitive set AND they consider the CAP Rate. CAP Rate is directly related to the performance of that property.
If you want to make sure your property is achieving its highest value potential, then you need to make sure the property is reaching the highest potential income every single month.
Now, some of you reading this will assume that creating an empathetic environment naturally leads to the sacrifice of efficiency, productivity, and revenue for the actual client - the property owner.
At Blue Rabbit Group we have found that the opposite is true.
As an example, we looked at the Columbia market of South Carolina. Looking at 4-star properties through Costar, the resulting output was 43 different multifamily buildings.
For these 43 properties, the average vacancy rate was 7.1% - not bad!
In order to see the impacts of empathy on property management, we then looked at the properties that were on the higher end of vacancy rates (above 8.5%).
This gave us a list of 15 properties with an average vacancy rate of 11.8%.
We further looked at three of the properties in more detail to see if there were any signs that empathy could play a role in these poorer performing numbers. By that we mean reviews showing positive or negative property management empathy, responsiveness, or communication.
We found that 100% of the reviews related to property management were negative and the average vacancy rate for the three buildings was 17.97%.
Flipping this process, we focused on properties with lower than usual vacancy rates. This resulted in 19 properties from which we further researched 3.
We found that 100% of the reviews were positive leading to little vacancy issues (average 1.03%)
We believe these charts show that property management empathy positively affects rent and reduces vacancy rates making it worth emphasizing in your management approach.
Example of Empathy in Hospitality
““While working for a hospitality company I had a housekeeping staff member walk by a disgruntled couple, who were guests, and mentioned they were leaving a day early due to them not being satisfied with their room assignment.
This was an opportunity to turn a service failure into a service win so I found the guests in the lobby and asked them why they were leaving a night early.
I knew that the most important thing to do was to provide empathy through listening.
I told them my staff member let me know of their situation, and I apologized for them not being in the space they thought they had booked. I then listened to how this issue had impacted their trip and experience with the lodging host.
After listening to the issue presented, I offered a solution. The solution ultimately did not work for them, but despite this lack of resolution, they were no longer dissatisfied with the service.
This guest said that because of how we handled the issue in the end, he wanted to give our company another try for their next vacation.
Through empathetic listening and communication, this guest became a routine tenant of that lodging host.
This is how we approach property management at Blue Rabbit Group: finding hospitable solutions to provide comfortable resort-style stays to our tenants.”
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How to Implement a Blue Rabbit Group Hospitable Environment
BRG knows that spending a few extra minutes with a tenant is important as it maximizes the property's performance for our clients. Here are a few ways to implement a BRG Hospitable Environment:
Building Trust:
And by this, we mean to start by actually being trustworthy! Many tenants have been negatively affected by management groups that do not value tenant relations, so it is important to begin with the understanding that this is an uphill climb.
Active Listening:
Active listening is not just hearing what is being said, but to actually engage in the conversation, approach with empathy to try to truly understand the experience behind what is being said, and care about the results of the conversation.
Some ideas from the Cleveland Clinic for Active Listening include: maintaining eye contact, maintaining open body posture, utilizing non-verbal cues to signal listening and take note of the speaker’s non-verbal cues, and remember to listen - not focus on drafting your response. The Cleveland Clinic also suggests taking notes if your tenant is expressing concerns or making suggestions for improvements as it shows attention to details with notating areas for improvement.
Responsive Communication:
Responsive Communication does not mean that you have to solve all the problems in 5 minutes. In fact, trying to solve something too quickly can actually have the opposite intended effect and lead to mistrust. When we say be responsive communication we mean
Acknowledge the correspondence in writing as soon as possible
Establish a reasonable timeline for solving the problem - set expectations
Meet that timeline and confirm that the problem has been solved.
Creating a Strong Community:
Explore how empathy fosters a sense of community among tenants. Provide examples of community-building activities or initiatives that can be enhanced through empathetic practices.
Personalized Solutions:
Encourage offering personalized solutions to tenant issues, rather than one-size-fits-all approaches.
Provide examples of how tailored solutions can enhance tenant satisfaction.
Regular Check-Ins:
Suggest implementing regular check-ins with tenants to understand their needs and concerns.
Provide examples of how check-ins can prevent minor issues from becoming major problems.
Remember that as the restrictions of radius for work continue to fluctuate, so does the tenant’s obligation to stay in one space. That means more choices for the tenant.
Will your building be their choice?
Learn more about how Blue Rabbit Group revolutionizes Property Management by delivering hospitable stays to residents.
