March 6, 2021

JF2377: Raising Occupancy and Avoiding Skips during Covid with Ashley Wilson #SituationSaturday

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Twelve years ago, Ashley and her husband started looking for investment strategies other than the stock market. They started with a few short-term and long-term rentals, eventually expanding to single-family units with historical background and multifamily units.

Before she formed a company of her own, she was a partner with another investor on a 225-unit multifamily property. Despite having a solid business plan, the company lost 120 people within the first ninety days through evictions and skipping. Ashley tells how she managed to turn around the sticky situation and raise the occupancy to 90% even with Covid-19 as a backdrop.

Ashley Wilson  Real Estate Background:

  • Full-time real estate investor
  • 10 years of real estate experience
  • Portfolio consists of 600 units
  • Based in Philadelphia, PA
  • Say hi to her at: 


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“The name of the game is to increase your equity.” – Ashley Wilson


Theo Hicks: Hello, Best Ever listeners, and welcome to the Best Real Estate Investing Advice Ever Show. I’m Theo Hicks, and today we’ll be speaking with Ashley Wilson.

Ashley, how are you doing today?

Ashley Wilson: Great. Thank you for having me.

Theo Hicks: Thank you for joining us. Looking forward to our conversation. This is Saturday, so we’ll be doing a Situation Saturday episode; we’ll talk about a sticky situation that Ashley was in, how she got into it, how she’s out of it and then what lessons she learned. Before that, let’s go over Ashley’s background. She’s a full-time real estate investor with 10 years of experience. Her portfolio consists of 600 units. She’s based in Philadelphia, Pennsylvania, and her website is

So, Ashley, do you mind telling us more about your background and what you’re focused on today?

Ashley Wilson: Sure. So about 12 years ago my husband and I started to look for alternative investment strategies. We weren’t firm believers in the stock market, and we both were doing very well professionally. I worked in clinical research and development. Ironically, I worked for about five years in vaccine development, and part of that time was on seasonal and pandemic flu. So closely related to what we’re doing today.

But my husband was a professional ice hockey player, so we both made pretty good money very early on in our careers, and we were trying to figure out where to place that. We stumbled on BiggerPockets about 12 years ago and started educating ourselves all about real estate. At the time, we didn’t know we would become full-time real estate investors, but that’s exactly what happened.

So we started with a few short-term and long-term rentals. We’ve house-hacked, we’ve Airbnb’d, we’ve invested in Notes. My father and I co-founded a house flipping company 6 years ago, which we still do today, and we focus primarily on older homes, historic homes, full gut rehabs and high-end homes. So that’s kind of our niche in the Philadelphia suburbs, and that’s our single-family business. And then in multifamily, once my husband retired 3 years ago, we moved back from Europe in Russia, where he ended his career, and we started our multifamily business. And today I manage asset and construction management on those projects. We started our own company of acquiring large multifamilies. So that’s what we do today.

Theo Hicks: Are those 600 units for multifamily, or is that across all properties?

Ashley Wilson: Nope, that’s just multifamily.

Theo Hicks: Perfect. So as I mentioned, Best Ever listeners, we’ll be doing a Situation Saturday, so the sticky situation is about inheriting a tough tenant base, and then how to handle that situation when you buy a property that has a tough demographic base. So walk us through the acquisition of this property, or if it’s a specific deal or just your business plan in general, and then why you decided to pursue these types of opportunities and then we can go into tips on turning over the demographic.

Ashley Wilson: So before we decided to create our own company, I was originally partnering with other general partners, so they would bring me on to do asset and construction management and lead their projects. And this particular example is that situation where I was asked to partner with this group and manage the project both on the asset and construction management side of it. So I wasn’t involved in the due diligence process, I came in right before close. And to that effect, when I came in, I was given a business plan in which they wanted to execute. Now, I had done my own research on the due diligence of the market and the ability for that property to perform based on their underwriting, and I had seen that it could perform that way based on my own underwriting and due diligence. So I wasn’t going in completely blind.

But once we acquired the property, what I quickly realized is that the business plan that they had outlined of renovating these units— so it’s a 225 unit property, and we are going to renovate 80 of these units over three years and then refi in year four was not feasible. So for starters, we had 120 people leave the property by way of either skipping or evicting them. So that’s not even inclusive of non-renewals in the first 90 days.

To put that in perspective, on average, a market benchmark is that you’ll have a 50% renewal rate. So across the 225-unit property, over the course of six months of a 225-unit property, you would have approximately 112.5 people vacate, just because they’re non-renewals in a standard market. So the fact that we had 120 people leave just because of evictions and skips in 90 days was detrimental to the overall operations of the property.

From there, when we looked to take back these units, what we realized is they had been not loved and cared on by the previous ownership group for a very long period of time. And to that point, the cost of turning these units was costing us more than if we were to renovate them and capture the premium. So it made more sense to change the business plan and execute it in a very fast-paced manner, so that we could use the renovation as a capital expense, put it below the line, speed up the process of renovating and capture those premiums sooner.

So to that effect, we depleted the occupancy to 64.4% in mid-August of 2019. And it took a very, very long time to build up that occupancy. In fact, we actually just reached 90% occupancy two weeks ago on that property. So we’ve been able to achieve that all during COVID. And the reason why we’ve been able to achieve this is because we took a very slow, methodical process in making sure that we put the correct tenants in place on the property. We didn’t sacrifice and create another situation where we would be then just having people leave out the back door because they couldn’t afford the property, they weren’t screened correctly, their income-to-rent did not match…

So we still kept the threshold at a 3.0 when most people would probably have dropped it 2.0 or 2.5 or 2.7, because of being at 64.4% physical occupancy – I’m not even talking economic – can be very detrimental on the overall operations and economics of the property, to be able to sustain all the expenses.

But we took a very deliberate approach, and by doing so, just to give a highlight, since March of 2020 – so that’s when we consider the start of COVID impacting our tenants, right? And I think most of the country would agree to that point, where unemployment got hit – to today, we’ve had a month-over-month build versus collected rate of 99.52% across the entire property, while continuing to build occupancy. And our concession that we’re offering to move in is actually less than what it was months ago. We’ve actually decreased our concession.

So there are a lot of things that we’ve done really, really well on the property, not only to attract new tenants, but also to keep the tenants that we have. And it’s because of that, I think we’re in the situation that we’re in today, while a lot of other properties may be in a completely different situation.

Theo Hicks: Well, thank you for going in a lot of detail on that, I really appreciate that. So I kind of want to go back and ask some follow-up questions… And the first one would be, you said that the original business plan was to renovate the 80 units over a three-year period, and then refinance in year four, and then after, you said, the first 90 days, 120 people left the property.

So I have a question for you – was that something that was just impossible to know upfront? Or should it have been something that the GPs should have known? And if so, what did they not do, that they should have done to realize that this would have happened?

Ashley Wilson: There are a lot of things that could have been done upfront to have captured this. First of all, I always put when we close on a property that we get a final walkthrough comparable to residential real estate. So in residential real estate it is commonplace to do a walkthrough within 24-48 hours of closing. And I put that on commercial real estate. The great thing about commercial real estate is it’s the wild wild west; there’s no set contract. You can create whatever contract you want and you can have it with whatever terms you want. So we always do a final walkthrough prior to closing, and that was missed on this one.

So there could have been a final walkthrough on the property, it could have been inclusive of going to the property during the daytime and looking at the car count; you could have identified that that property wasn’t occupied to what they were reporting it as, [unintelligible [00:12:02].13]. Coupled with the fact that you could pull delinquency reports and see how much was delinquent, whether or not they put on record that they filed evictions or that these units were actually vacant, they were skipped prior to that. So you can also look at when you do a file audit and look at the qualifications of the residents.

So for example, on a property that we just purchased a month ago, during due diligence, we identify the current tenant base can actually afford more than what we’re pushing our rents to, and we’re pushing our rents on that property by over $300, and our current tenant base, our average tenant can afford that. We were concerned about having to change over the tenant base. Well, we might not even have to do that on that particular property. That’s a different property. But there’s an example of how you can QC your tenant files and verify income, verify their qualifications, verify they did a background, verify that there’s a security deposit; all of these different things, and you can cross-check that. You can also go through an estoppel agreement and get verification from the tenant themselves to make sure and have all the tenants go around the entire property. There’s a great way in which you could identify it, because the tenant wouldn’t even be in there to sign off on it. So there are a lot of different things that you can put into place to have identified this, and this was definitely, I believe, a lesson learned for all GPs on this one.

Theo Hicks: What’s the thought process behind going during the day to look at the car count?

Ashley Wilson: Right now, for example, most people are working from home… So going during the day and going in the evening, you can see whether or not you have tenants who are night shift workers or day shift workers, and you can see from a car count on the property. Now, of course, there could be cars that are sitting there that someone else is just keeping the car on the property. But ultimately, a lot of times on the list is — you’re going to have a cross-check of… It depends on the market, but a lot of times cars have to be registered to be on the property, so you can identify it that way. Whether or not they’re working, whether or not they’re even there, if they’re not there in the morning, they’re not there at night, where are they? Maybe they’re on vacation, maybe they’re somewhere else. But if you check it in a couple times, you’re going to see that maybe that current ownership never filed eviction, and it’s really skipped and it’s lying on the rent roll, which is honestly pretty commonplace in this industry… So unfortunate as it is, you’re buying properties as is, besides outright fraud, but it’s on you to really identify these discrepancies.

Theo Hicks: That last thing we talked about getting verification from the tenants themselves – what was that called?

Ashley Wilson: It’s called an estoppel agreement.

Theo Hicks: Estoppel agreement?

Ashley Wilson: Estoppel.

Theo Hicks: Oh, estoppel agreement. I’ve never heard that before. Interesting.

Ashley Wilson: More so, you’ll hear it used when you’re verifying rent. So for example, if you want to confirm that an ownership group isn’t lying on the rent that that person is being charged, it’s a form that the tenant would sign off to say, “Yes, these are the conditions in which I’ve signed my lease agreement.”

So let’s say for example, on the rent roll it says that they’re collecting $800 for unit 1B, but you get an estoppel agreement and you have the tenant sign off on it and the tenant signs off that they’re paying $650. Well, they’re not going to write that they’re paying $800, because they know when you come in, you’re going to charge them $800. They’re going to write what they believe the terms of the contract to be. So if the ownership group has falsified a lease contract and forged signatures or attached another form onto an existing contract and it says that it’s $800, or if there’s any sort of mismatch, you can always verify that with a tenant.

Theo Hicks: Got it.

Ashley Wilson: It’s a legal document.

Theo Hicks: Okay, so the next thing you talked about was that once these units were vacated, whether it’s through skipping or evictions, when you went into the units, you realized that the cost to turn them was more than the cost to renovate them. And you said that the plan to go in there was to do 80 units, and that 120 units were vacant. And the plan was to do that over three years. So where did the money come from to do these renovations?

Ashley Wilson: Well, we had a construction loan anyway. So this was a bridge lending situation. We have a bridge loan on the property and a construction line. So the line was already there to do the renovations, it’s just we were going to space them out further. And this gets to as an asset manager and a construction manager, why you should really be heavily involved in the process.

This is not a blanket, “I’m going to renovate every single unit.” This is an algorithm in which I’m making the determination based on the cap rate in the market, based on the cost of that renovation, to identify — and also the premium I can get on that unit, to identify whether or not I’m going to renovate that unit or another unit.

There are other things to take into consideration, for example, the demand of that particular unit style. But ultimately, you don’t want to have this just left up to your property management company to pick and choose, because what if they choose the unit that costs $10,000 to renovate and it’s $100 premium, when you could have chosen the unit that costs you $3,000 and it’s a $90 premium. Those are types of situations in which you really should be overseeing and managing so you can make the determination… Because ultimately, a lot of people think the name of the game is to increase your evaluation. The name of the game is not to increase your evaluation, it’s to increase your equity. And by increasing your equity, you have to always keep in mind the ROI.

Theo Hicks: Got it. So you didn’t renovate all those units; it’s more of like a calculation based off of all those stuff you’ve mentioned ti determine which of those units that actually makes sense from an ROI perspective to renovate based off of — including what that construction line was, right?

Ashley Wilson: Correct.

Theo Hicks: Got it. So something else you mentioned too was that rather than getting yourself in the same situation again, with putting in whoever into the units, you methodically focused on getting the right high-quality type of resident, again, so that you wouldn’t face that same situation again. You mentioned there’s a lot of things that you did to increase that occupancy; you said occupancy was as low as 66.4% and it reached 90% recently. So what are some of the things that were done to increase the occupancy and then to make sure that the people that moved in were of a high quality?

Ashley Wilson: So it’s really twofold, what you’re trying to do is you’re trying to stop the people exiting out the back door and you’re trying to attract people more in the front door. So to tackle it first, on stopping the people exiting the back door, you need to have incentives, you need to have a good property management team, you need to show value in the community.

One thing that we do is we contact our residents on a weekly basis during this COVID situation for two reasons. One is to check on their general welfare – we’re not straight up asking them whether or not they have COVID, but we’re checking on their general welfare; and two, is to see whether or not they’re still employed or if they need help filing for unemployment. By helping someone file for unemployment, it allows them to get their unemployment sooner and be able to pay their rent sooner. So that really provides an added benefit.

The second thing that we do with our current tenant bases if they do fall on hard times, we try to work with them and set up a payment plan so that they can stay on track. Ultimately, if they take the responsibility and come to us and set up a payment plan, especially during this very unique, troubling situation, we’re willing to work with them and figure out a way to make it work. If they’re going to ignore us and not work with us, then ultimately, it’s on them. There’s not much more we can do. But we’re willing to work with all of our tenants if they’re willing to work with us.

So showing that value and showing that you care it goes a long way. We also offer incentives from time to time with renewal bonuses; we also do a referral bonus too. But we do a renewal bonus to help people get some value. And when COVID first started, what we did – as well as we incentivize people to pay early; so we incentivize them by doing a raffle. So one or two people in the property would get a discount off of their next month’s rent by paying early. What we believed is having someone pay early, especially when we didn’t know if they would fall on unemployment, that it would cover their rent, it would cover them being able to stay at the property, as opposed to them not having a roof over their head to be able to figure out if they do get unemployed what they need to do next. So we’re trying to help them out by keeping their housing situation confirmed.

With respect to attracting a new tenant base, we do a lot of different things. One thing that we do is we really make sure that our marketing efforts are not let up because of it. What we’ve realized is that there are going to be less people in the markets looking for a property, so it’s more important than ever to capture as many people that are looking for a new place to call home. And what we do is we continue to market, we continue to have our property look very nice and clean, and put in a lot of different amenity services that are helpful, and create less person-to-person contact.

So for example, doing electronic showings, being able to virtually tour the property, being able to sign a lease agreement online – everything electronic, so that it makes their life easier, they have less stress if they need to move, and then we’re able to do everything electronically.

We also too have put incentives in place as well through concessions to encourage people to come into our property. Crazy enough, our concession is not even close to being the most competitive in the market; I wouldn’t even say we’re at the 50% marker either. I think we’re on the lower tier in terms of what we’re offering concessions. But what we do is we continue to reach out to businesses, we continue to make it known that we are trying to help as a community, to help the greater community.

So we work with different small businesses. So for example, we’ll contact a pizza shop and say, “What’s your slowest business day?” Especially these small businesses are hit hard, so what we do is we say to them, “Okay, Tuesday’s my slowest day.” “Okay, well, could you offer our community $5 off on Tuesdays if they order pizza from you?” “Yes, we can.” Well, then we pass that savings on to the residents and say, “Hey, if you order from so and so’s pizza place, you get $5 off on Tuesdays.” That way, it allows that business to stay in business by providing value to our property, because we can negotiate on behalf of a larger group.

So all the things that we’re trying to do is really to benefit our community and help the community through a really troubling time. And I think because of all of those things and the support that we’re providing for the larger community, the word gets around. So for example, the permit office is recommending people, our EMT companies, our police department, they’re all recommending our property, and I think it’s because of all the work that we continue to do.  We are still touching base with the humane societies and schools to do school drives, and food drives, and toy drives. These are all things that are important within the community, and we’re still leading those charges.

And then also too, just one last quick thing is on communication with emergency work order calls; we’ve made it known very early on that to protect not only them but to protect our team, we want to limit interaction between everyone. So what we’re doing is handling only emergency work orders right away, and the other work orders will be handled on a case-by-case basis. But as much as possible, we want to limit the direct contact to protect everyone.

So I think providing that communication, always staying in communication and trying to help people when they’re in need sounds so common sense, but a lot of people just get lazy about it and they don’t execute on it.

Theo Hicks: Thank you for sharing all that. One last question I had – something you said at the very end of your first thing that you were talking about, you said something about 3.0 versus 2.5… What was that factor when you’re looking at new residents?

Ashley Wilson: That’s the income to rent. So typically what you’re looking at – so you’re making sure that their income is, at minimum, 3x whatever the rent is. And I know a lot of people when they get in situations where their occupancy is depleted, they’ll take a shortcut and drop that to a 2.5, and they’ll put a bond on, or some other double security deposit; they’ll try to find some other way in which that they make up for that risk. We’d actually put that on, but put it on at the 3.0. So we use a program that helps provide some assurance to us, and it works with someone who’s not able to put a lot of money down on a security deposit, but they still qualify otherwise, but at least that provides some insurance for us too, especially during these challenging times.

Theo Hicks: Got it. Alright, Ashley, is there anything else that you wanna mention about asset management or your company and where people can learn more about you before we sign off?

Ashley Wilson: You can link to all my companies at that and you can follow me on Instagram @badashinvestor. So I cover all different types of real estate on Instagram and on my website, you can link off to my multifamily company which is called Bar Down Investments from there, and then I have other companies as well you can link to.

Also too, I just co-authored a book called ‘The Only Woman in the Room’, and it was released in the middle of September, and within 24 hours became an Amazon bestseller. I highly recommend anyone who is in real estate, who wants to be inspired by 19 other women in all different asset classes, all different backgrounds to check it out. So it’s called ‘The Only Woman in the Room: Knowledge and Inspiration from 20 Women Real Estate Investors.’

Theo Hicks: Well, congratulations on the success of the book. As a co-author of a few books myself, I understand it’s a long process to write books. So I understand completely.

But yeah, thank you so much for coming on. I don’t get to talk about asset management as much, so I appreciate you going into a lot of detail, specifically on that deal, but also kind of what your philosophy is on asset management in general. Lots of great advice.

You talked about some of the best practices for doing due diligence before closing, you talked about the final walkthroughs, looking at car counts, pulling various reports… You talked about the algorithm or the way you approach determining which units to renovate; it’s not just every unit that’s vacant you renovate. It is very detailed and data-driven.

And then you went into a lot of detail on how you are able to maximize economic occupancy by focusing on the two main aspects of stopping people from leaving, and then attracting new people, and you went through examples for all of those.

So thank you so much for joining us today. Again, her website is so check out her website. Best Ever listeners, as always, thank you for listening, have a best ever day and we’ll talk to you tomorrow.

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