Role of the property manger increasingly important.

The residential real estate industry is in a state of metamorphosis. As we emerge from the severe recession of the past few years, a new style of management has been evolving as well as a new set of ethics: one that is more hands-on and interactive - often involving a company's principals - and one with more personal and professional integrity.

Merlon Management is one company that has adapted its style to meet this new environment.

The character and attitude of management personnel has already become a key factor when evaluating a management company. For example, building owners and cooperative and condominium boards no longer want a manager to only supervise the staff and attend meetings; they expect a management team to focus on the value of the building and its apartments through computer-aided problem-solving techniques, hands-on senior management involvement and a proactive approach.

Building owners and boards want a management company to work with them, not just for them. For instance, Merlon Management has adopted a problem-solving approach that uses a series of computer-generated analytical reports. A number of viable alternatives can then be presented to clients and both Merlon and its client can decide how to proceed.

Team Approach Replacing Traditional Hierarchies

A team-oriented concept of management has long been advocated by William Deming. His hands-on study of Japanese management styles and subsequent publications on the subject have gained widespread acceptance in the United States. They make particularly good sense for residential managers who must apply a variety of specialization to resolve individual problems.

Buildings owners and boards of directors no longer easily accept the management style of appointing one manager for the entire building. A more proactive approach is having a team of managers work together on a building, with each employee reporting to one another -- managing the building cooperatively among themselves.

Merlon believes Deming's teamwork approach is very effective. As an organized team, the managers and senior level staff apply their individual expertise to one area of the overall management of the building. With this pooling of resources and integration of responsibilities, communication among everyone is enhanced and problems are solved efficiently and effectively in a round-table format.

Emphasis on Managing for Positive Cash Flow

The real estate market has been in a state of recession over the past few years. However, hopes of a better market are not going to bail buildings out of financial difficulties. Managers must focus on creating a positive cash flow for buildings; the state of the market cannot dictate the company's management activity.

Merlon Management has used the sluggish real estate market to its clients' benefit. The company has driven prices down by employing competitive bidding. This often results in buildings being serviced by more than one vendor, eliminating the need to relay on one source. Merlon then implements a specific plan for the building that will improve cash flow and reduce operating expenses for building residents.

Buildings Must be Viewed as Independent Operating Entities

Managing residential real estate must focus on treating each building as a separate small business whose success plays an integral part of a whole. A building can no longer be treated as an asset that will ultimately be lost in the shuffle of a large portfolio of buildings. At Merlon, we work with a small team of experienced professionals, ensuring that each Merlon staff member understands every facet of every one of their properties. Each building has its own balance sheet and is expected to produce its own profit margins.

With changing times and the evident slowdown in the real estate industry, management companies must redefine their management styles. Building owners and boards of directors are requiring more from their management companies; they want more value for their dollar. Merlon has grown by giving their clients this value through a management style that has proven successful and is reflective of the powerful economic demands of the times.