Part 2 | Our Continuing Conversation: How is COVID-19 Affecting Your Apartment Properties?


We continue in our series of personal interviews with some of our clients to learn how they are managing their businesses and lives during the COVID-19 lockdown. As was the case in last week’s post, we will present to you in a Question and Answer format responses from select clients. We present 3 new parties this week.

For our second series we interviewed Gabe Horstick of Campbell Street Asset Management, Erik Hubbard of Villa Capital Properties and Bob Hahn of Dimensions Management Corporation.


Let’s start off on a personal level, how are you dealing with the adjustments to work environment? How has the nature of your job changed?

Horstick:  As an entrepreneur, you need to be an eternal optimist, stay positive and lead by example. Every day that passes is a day closer to returning to normal. I’ve dealt with the new environment by trying to stay active and sticking to a routine. The nature of our jobs is the same – provide good customer service to our existing residential and commercial tenants and create the best property we can to maintain a competitive edge and maximize the return on our investments. 

Hubbard:  Adjustments are not too severe as the team is still servicing the buildings we own and manage on a daily basis. More time is being spent checking on the team and ensuring they feel safe and healthy. We are also spending time tracking down supplies more than ever (i.e., masks, cleaning agents, etc.)

Hahn:  We are following the protocol for COVID-19 regarding distancing, hand washing and masks. Our office still operates 7 days a week but we are not accepting visitors without appointments. Our office is spread out enough so office staff remains separated and distanced. Our buildings are getting additional sanitation and cleaning. Maintenance servicing continues with protocol in place. Communication to tenants has been elevated with COVID-19 messages being sent to all tenants on a regular basis.


How are you managing your employees to allow them safety and still provide excellent management and operation of your properties and or business? Are there any specific solutions or actions that your team has employed that you are particularly proud of? 

Hubbard:  We have taken the approach that we as a company are here to assist our tenants through this difficult time. We are servicing emergency work orders only but if tenants need anything we are also assisting with the little things (changing lightbulbs for them, grabbing their mail for them, packages, picking up rent checks, etc.). We are performing daily deep cleans, and we are doing welfare checks periodically for all tenants.

Hahn:  We provide the option to remain at home if they are older or have health situations that make them susceptible to the virus. We insist they stay home when feeling sick. Most of our staff has stepped up and worked extra hours as needed and covered all the extra needs that have arisen.  

Horstick:  We have encouraged everyone to limit their personal risk and exposure by working remotely and have adhered to all local laws and recommendations of the CDC. We have limited maintenance and repairs to essentials to avoid any unnecessary exposure. Showing occupied apartments has been limited to video tours. I’m proud of how our whole team has leveraged technology to handle as much leasing and management to adapt to the new normal.


Changing the way we work sometimes produces unintended consequences, good or bad. What change has surprised you the most in this environment?

Hahn:  We have experienced a heightened awareness of the connectedness that exist in all parts of society. The unrealized concerns that tenants, vendors, suppliers and employees have and don’t usually express. We see more clearly how important we all are to each other to accomplish all that needs to be done, large or small, to overcome this crisis. Listening and responding has become essential.

Horstick:  The most surprising change we’ve experienced has been the success of leasing apartments using virtual tours and other media. There are still prospective renters that won’t sign a lease without seeing a unit in person – but the overall absorption of new and existing product has been on par with past leasing seasons. We’ve been at an advantage this year because most of the apartments we have available are vacant new construction and have no limitations on how showings are conducted.

Hubbard:  Don’t know if change is the word but reaffirmation that we have a rock star team that bleeds VCP – no employee has backed down from assisting the company or the tenants.


Let’s talk more about actual operations. What are the stresses you are experiencing operating your properties and managing your tenants or business during this period?

Horstick:  The most stressful component of managing our business has been dealing with commercial tenants who are struggling due to government mandated closure of their businesses. We’ve encouraged both residential and commercial tenants to voice any issues they may have early so we can work together to find an amicable solution. So far that process has gone smoothly but may prove more challenging the longer businesses are required to stay shut. 

Hubbard:  What happens if a COVID-19 breakout occurs in one of our buildings? How does our team stay healthy while servicing tenants? Rent collection can also be a concern, as is local government’s push to ensure a combative stance between tenants, landlords and city officials.

The majority of landlords are already acting compassionately during this time with payment plans and rent deferrals – it does no good for the city to continue to talk extreme measures related to rent abatement and delayed court proceedings but then expect the landlords to survive. Sad to see some of the media coverage mistakenly depicting landlords as the “bad guy/gal.”

Hahn:  The entire business cycle – daily, weekly, monthly and yearly (with all its components) – now has an added layer of consequence and opportunity during the crisis. Everyone is stressed about getting sick and most are stressed with financial concerns. We are constantly looking at how the crisis will affect planning the day, week, month, year and longer as we look to how business and society is functioning and will function after the crisis has subsided. The most difficult task is to navigate concerns with empathy but also within a business context that changes daily.


Considering the changes experienced during this period, which do think (or want) to continue after recovery? What positives are you finding in this time that you hope to continue after this passes?

Hubbard:  The majority of our tenants have actually said thank you for all we are doing right now. I think they are witnessing our team in the trenches everyday exposing themselves to ensure our tenants are OK. I hope the nature of this tenant/landlord relationship continues after the recovery. 

Hahn:  Understanding our connectedness with each other and to empathize towards a deeper understanding of how we need work together so effective solutions can be implemented. The way business will be conducted in the future will be changed as we have adjusted to the COVID-19 crisis.

Horstick:  If there’s one thing that a time of stress like this reminds us of is to never over-extend, or deviate from a strict acquisition criteria. The bottom line is stay conservative; sometimes the best deal is the one you don’t do. I view the current situation as a stress test, much like what major lending institutions were put through during the financial crisis of 2008/2009. This stress test will inevitably thin the heard – those who are conservative and have capital reserves on their balance sheet will survive and come back stronger than before. We plan on continuing our conservative and disciplined investment approach once business is back to usual. One of the positives of this situation is that it has affirmed we have a sound business model that provides excellent risk adjusted returns. It pays to stick to a strict acquisition criteria, have the right capital and debt partners, and the best people around you at all times. We feel blessed to work and do business with some incredible people that I consider to be the brightest minds in our industry. 


Any other thoughts you would like to share?

Horstick:  As this situation began to unfold all I could think of was how in many ways it felt similar to the time when Bear Stearns and Lehman Brothers collapsed at the beginning of the Great Recession. As long as I didn’t read or watch the news non-stop I felt as though my life was relatively unchanged and COVID could be controlled and managed and everything would soon be fine (the eternal optimist). It wasn’t until I spoke to certain people who were fearful and panicked that I felt this was like the Titanic had just struck an iceberg. 

One lender made the comment to me that offices will never be the same because people will realize they can work from home. My response was that this was the same pessimism I heard in 2009 – because as we all knew in 2009 no one would ever want to or need to work in an office again. People have a very short memory and I think those who will do the best in the long run are those that can look past all the pain, the noise, the mania and the panic and believe that we as a nation and society will be OK and recover in a matter of time. The events that have unfolded will not end the American way of life as we know it. If you struggle to follow that logic it will be difficult to move ahead as a risk taker and an entrepreneur. Optimism is challenging but necessary at a time like this to get out of bed each day, stand tall, and do it all over again.   

Hubbard:  Stay safe.

Gabe Horstick is a co-founding member of Campbell Street Asset Management (CSAM). Founded in 2011, CSAM is a full service real estate investment firm that specializes in the acquisition of multifamily properties and invests significant capital transforming its buildings to include smart layouts, top of the line finishes, and modern amenities.

Erik Hubbard is a founding principal of Villa Capital Properties (VCP). VCP owns and operates multifamily and office properties in the south and west sides of Chicago in addition to suburban and Indiana properties. VCP also acts as a third party manager and provides receivers service, being particularly active during the Great Recession.

Bob Hahn is Vice President and General Manager of Dimensions Property Management. Dimensions operates over 900 apartments and commercial spaces that represent total assets in excess of $125 million.