• Mike Bergelson

2021: Year in review

As we did last year, we’d like to take a moment to share some of the highlights of 2021. On the whole we made meaningful progress towards our goal of delivering top-tier investor returns by maximizing the experience of our residents, community and colleagues.


Investors

Our goals for this year were to:

  • Close on 4 - 6 quality apartment communities across our Generations and Opportunity programs

  • Deliver performance in line with or better than our business plans

  • Grow our Generations network substantially

We closed four transactions totaling six communities in our Generations program this year (up from two in 2020). Three properties were in Oregon, including Township in Canby, OR; Towncenter in McMinnville, OR; and the Village in Keizer, OR. Three properties were in Washington, including First Place and Devonwood in Battle Ground, WA and Salish Flats in Airway Heights, WA, just outside of Spokane. These acquisitions furthered our goal of geographic diversity as before this year we did not own any properties in Oregon and only a single property in Washington. We hope to continue to expand our ownership footprint in 2022.


Additionally, we sold the first two California-based properties that we acquired in our Opportunity program (designed for shorter term holds) in partnership with Angelo Gordon: Vineyard Gardens in Santa Rosa and Waterscape in Fairfield.

We also doubled the size of our Generations Network this year. We are honored that investors put their confidence in us and are willing to introduce us to friends and family seeking similar investment opportunities (the lion’s share of our network growth came from referrals this year). On the other hand, we recognize that this rapid growth created more investor demand than we could satisfy at times.

We’re proud to report that we delivered against our performance goals and hit or exceeded our distribution objectives for each of our investments this year.

Residents

Our resident-related 2021 goals were to:

  • Continue to work with our residents to find solutions that meet the cash flow needs of the community while minimizing the impact of Covid-19 on their families

  • Maintain market-leading occupancy and rents, the ultimate test of the value of the experience we deliver

  • Implement a first version of resident experience measurement so we can better track the impact of the operations and capital improvement decisions we make

In 2021, we worked closely with our pandemic-impacted residents to help them access available rent relief funding. Unfortunately the resident journey for applying for these funds was, in many municipalities, confusing and riddled with delays. We continue to actively engage with our residents feeling the economic burden of Covid-19 and hope to keep our site teams focused on empathy and fairness during these difficult times.

As mentioned above, we were at or above our occupancy and rent goals this year. Like many owners, we benefited from the “rising tide” dynamic in the markets in which we operate. While we feel we’re on a path to offer a market-leading resident experience, we have more work to do here at some of our communities where we’re still working through transitions from prior ownership and staffing training.

Related, we missed on our goal of developing a resident experience measurement tool. While we did considerable research in this area and have a plan in place, we weren’t able to implement a first version of this tool and expect to do so in 2022.

Colleagues

This year we set out to:

  • Add 2 - 3 critical team members to help us meet the demands of our growing business

  • Continue to codify and evolve our company values to ensure we’re building the kind of organization where people choose to build a rewarding career

We were successful in recruiting two new team members to Glencrest:

Marci Cornell brings more than a decade of experience in the commercial real estate and financial services industries to Glencrest. She held senior roles in property management and was part of the asset management team at a real estate crowdfunding startup. As head of business operations, Marci is building the processes that will allow us to scale to meet our growth and key constituent experience goals.

Alex Nakollari led marketing and transaction support for a high volume residential and commercial real estate team in New York City before joining our team earlier this year. She also holds an active real estate license in Massachusetts. As head of marketing here at Glencrest, Alex works with our site teams to innovate around and optimize resident marketing and experience.

We did (finally!) hold the first Glencrest offsite in December of this year after making the difficult decision to cancel one slated for October due to safety concerns related to the then-prevalent Delta variant of COVID-19. We are encouraged by what we accomplished and feel we’re taking important, if early, steps towards building a company culture about which we can all be proud.

Community

Our goals for this year were to:

  • Implement a first version sustainability scorecard for our communities

  • Measure and report on progress against stated sustainability objectives in existing communities

We once again committed through the Green Up program with our lender Freddie Mac to reduce energy and water consumption by at least 15% (each) within two years at three of the properties we acquired this year.

Having said that, we failed to accomplish the goals we established around the deployment of a more extensive sustainability scorecard. It has proven more difficult than we anticipated to find a meaningful measure of sustainability that balances simplicity with accuracy. We continue to research existing, third-party options but have found very little available specific to the unique requirements of the multifamily industry. Our thinking has evolved on this subject and we now feel we might need to roll our own measurement framework until industry-wide alternatives become available and start to gain adoption.


Looking forward to 2022

In many ways, our goals for next year are very similar to the ones we established for 2021:

Investors
  • Close on 4 - 6 great apartment communities across our Generations and Opportunity programs

  • Increase average per-deal equity amounts in order to better satisfy network demand

  • Deliver performance in line with or better than our business plans

Residents
  • Continue to work with our residents to find solutions that meet the cash flow needs of the community while minimizing the pandemic impact on their families

  • Implement a first version of resident experience measurement so we can better track the impact of the operations and capital improvement decisions we make

  • Maintain market-leading occupancy and rents, the ultimate test of the value of the experience we deliver

Colleagues
  • Add 2 - 3 critical team members to help us meet the demands of our growing business

  • Continue to codify and evolve our company values to ensure we’re building the kind of organization where people choose to build a rewarding career

Community
  • Implement a first version sustainability scorecard for our communities

  • Measure and report on progress against stated sustainability objectives in existing communities

  • Deliver on green commitments for properties acquired in ’20 and ‘21

As this year draws to a close, our dominant feeling continues to be gratitude - for the resilience of our industry, for our strong and expanding team and investor base and for the growth we saw this year and the prospect for more in 2022.



All the best,




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