Two major local landlords that have self-managed their properties are now outsourcing that task, although they’ve taken a different approach to doing so.
Denver-based BMC Investments said last week it has sold its property management division to Asset Living, the country’s third-largest property manager.
And Chicago-based Laramar Group, which has significant holdings in Colorado, is outsourcing property management as well, Vice President of Human Resources Amy Padgett told BusinessDen Friday.
In a letter to the state, Laramar said the move will result in 76 employees losing their job, although Padgett said some may be able to land positions with the firm Laramar ultimately hires to do the work.
“That is the hope,” Padgett said.
Laramar has yet to determine the firm it will hire, Padgett said. The company expects to start letting its employees go in June, according to the letter to the state.
Laramar has offices in Denver and Chicago. According to the company’s website, Laramar’s local holdings include 20 complexes within Denver city limits, including Archer Tower at 901 Sherman St. and City Gate Apartments at 2890 Brighton Blvd.
BMC, meanwhile, owns 5,200 apartments across 14 Denver-area complexes. The company, most known for its development work in Cherry Creek, had self-managed the complexes since the company was founded about a dozen years ago.
“We thought we could do it better,” BMC CEO Matt Joblon said of the firm’s thinking back then. “We’d be more hand-on; we’d be in control.”
But Joblon said the property management sector has changed drastically since then, as a flood of private equity dollars has prompted consolidation. It won’t be long, he said, until a property management company considered small manages 200,000 units, and the big firms manage 1 million.
“It’s become a scale game,” Joblon said.
Compared to the bigger players, BMC wasn’t able to invest in as much training and perks for its property management employees.
“We realized we were having a hard time attracting really talented people to that side of the business,” he said.
BMC always has to think about its investors, who collectively own its apartment complexes. Last year, he said, firm leadership stepped back and determined self-managing the units wasn’t best from the investor perspective.
So Joblon reached out to Asset Living. The company operated locally as Echelon Property Group before being acquired by Houston-based Asset Living in 2021.
While investors own the properties in BMC’s portfolio, they didn’t own the company’s property management division. Joblon said they meant he didn’t need to maximize the purchase price when selling and could just go straight to his preferred buyer.
“We said, ‘If we’re going to do this, you’re going to take all the employees,’” Joblon said.
BMC’s property management division had about 200 people, 14 on the corporate level and the remainder working on-site at the firm’s complexes, Joblon said.
Asset Living now manages some 202,000 units nationwide, including about 20,000 in Colorado, according to BMC.
BMC and Laramar’s outsourcing aren’t the only recent changes in the local property management sector. Alabama-based Evernest said Monday it has acquired Englewood-based ParkSide Property Management, adding 170 homes to a portfolio that now includes 16,000 properties nationwide. ParkSide is the 38th organization purchased by Evernest, with 17 of those deals closing in the last year, according to the company.
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