COMMON AREA & FITNESS CENTER REHAB
Client Review: Property Owner plans a rehab of their community to upgrade the common areas and fitness center at a 300-unit community.
The Work: RealtyCom was asked to help the Owner determine how best to provide High-Speed Internet and cable services in their newly planned fitness center, which would have multiple wall-mounted flat screens, in addition to state-of-the art Life-Cycle equipment with integrated video screens and Internet access. Additionally, the other common areas contained eight more HD wall-mounted flat screens that needed service.
RealtyCom worked with the owner’s low voltage consultant and architect to understand the layout of the new addition, the planned location of the fitness equipment and video screens. We then reviewed the specifications for the Life-Cycle equipment to determine what the resident experience would be. Finally, we reviewed the existing Service Provider agreements to determine what video and Internet services were included as free courtesy services for the asset.
All the major Service Providers (such as AT&T, Charter, Comcast, etc.) have Business Class Service (“BCS”) groups which are separate from the Residential Service groups who typically work with multifamily real estate owners. Representatives from the BCS groups often contact individual properties to sell services to the leasing office, common areas and fitness centers. BCS groups do not know what the properties should be receiving for “free” as a part of their courtesy service package from the Residential group, and often sell additional services that are unnecessary. This type of confusion is common and can be costly for Property Owners. RealtyCom works to negotiate the inclusion of certain telecom services as a part of the amenity package for our clients, greatly reducing property expenses.
RealtyCom determined that the best way to service the new fitness center was to combine the various products of both the traditional cable company (Franchise Provider or “MSO”) and the telephone company (Local Exchange Carrier or “LEC”) to get the maximum account mix.
RealtyCom negotiated a new agreement with the LEC to provide courtesy services to common area flat screens at no charge to the property. In addition, under the terms of the new MSO agreement, our client received hardware allowing all the Fitness Center flat screens and integrated monitors to receive 80 cable channels at no cost.
The Results: RealtyCom created a deal structure with both the Service Providers in this market that was ultimately the best use and value of their services. The contracts with the Service Providers resulted in an annual savings of over $200,000. Moreover, RealtyCom does not collect a fee on value created under complimentary services.