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Tami Bonnell

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Childhood Lessons Taught Me to be a CEO By Tami Bonnell Real estate was always a part of my life. I did not exactly grow up in the typical real estate family of people listing and selling; my dad was involved in building and developing. He had an eye for two things, people and possibilities. I am one of six children and one of the best things we were ever taught was work ethic. All of us started working when we were really young. I started answering phones in my father’s office on weekends and during school vacation starting at 8, maybe 10. I can still say it, “Good morning, Graham Associates, how may I help you?” My dad would take me along to collect rents on Saturday mornings. Before going out he did his homework on everyone. He would go in and have personal conversations with people. He knew if they were struggling with rent because they had things going on in their family or a medical problem, etc. He would listen and say, “Okay, let’s put a plan together.” Because he was so understanding, they would pay him first. He probably taught me more about personalization than anyone. The Beginnings That truly came in handy at my first real estate related job. I was a mortgage originator until I went into management and that gave me an opportunity to focus on a consultative sale as opposed to just being a salesperson. I got to find out and focus on what people’s dreams were, what was really important to them and what their circumstances were, so I could pick the right program for them. By learning those things, I could be sure that they were not going to be buried when the adjustable-rate mortgage adjusted or if they only needed a temporary loan, etc. I did a lot of homework on the people and that really made a difference. Following my time in mortgages, I was instrumental in building three major brands. I found that in a consultative sale, you are selling a dream. Though someone wants to own their own business, not everyone is qualified to do so. The average person in real estate might be a really good salesperson but not necessarily a really good businessperson. I enjoyed being able to help teach them and give them a track to run on. I could help them become a better businessperson by teaching them how to be more effective in their community and helping them to recruit people into their company. I taught mergers and acquisitions and acquired 114 companies for another brand prior to joining EXIT Realty Corp. Back when I was selling franchises for another brand I distinctly remember sitting in the audience at a convention, and Tom Peters was speaking about the pursuit of “WOW.” He said, “How many people in your company go into work to WOW people every day?” I remember thinking, “Oh, my gosh, just me.” I had six potential franchisees there, and I felt sick to my stomach, like I was selling something I did not believe in anymore. You cannot sell something in which you do not believe! I decided that day to look into business opportunities. A friend sent me information about EXIT Realty, which in 1999, did not even have an office in the United States. EXIT Realty Corp EXIT made really good business sense. They were in the business of real estate, and it was as if they had thought of everything, from leadership, education, training, technology, and being a good corporate citizen to having a vested interest and residual income. I found over this period that the best thing for me to personally invest in was people. My lane was two things, making EXIT famous in a good way by selling franchises, doing mergers and acquisitions, and selling regions and finding that sweet spot in a person, literally catching them doing something good and helping them to find their lane. It was simply icing on the cake that it turned out to be real estate related. I started with owning the rights to New England in 1999, then became Vice President over the US in 2000, President over the US in 2001, and in 2003, I broke some world records selling out 50% of the regional rights by population in the company. Then, we hit the worst recession since the depression and needed to lock arms and pull together more than ever. I believe investing in our people made all the difference in the world when the recession hit. Along with Steve Morris, the founder and Co-Chairman, and Erika Gileo, the Chief Operating Officer, we decided only people in leadership positions would take a pay cut and we would not lay anyone off. Our strategy was to outsell and out-think our way out of the recession. Instead of laying off people in droves, we put together a stimulus package worth more than $50 million. We reached out to our administrators, brokers, regional owners, and agents in their homes through videos, webinars, techinars, and Live Interactive. We helped them study everything from Eckhart Tolle, yoga and meditation practices to how to excel in listing and selling real estate. We invested in our people and they trusted us. Valuable Lessons Learned I held the title of CEO of EXIT Realty Corp. International since 2012 and in September of 2021 I became Co-Chair. This year, we added the positions of co-chair, United States CEO, Canada CEO, and a new US President. We are positioned to further grow organically by providing our people with a legacy and an excellent quality of life! During this journey, I have learned some things that have helped me further succeed and that can help any business owner or investor. First, intention is not going to accomplish anything, only action will. I created a six-week action plan early on in my career, so halfway through the month I plan out the next six weeks.

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“Servant Leadership”

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How Kyle Amerson Built His Real Estate Business Serving Others As a student at Dallas Baptist University, Kyle Amerson learned a lot about “servant-leadership.” Not only was it the university’s mission, but it was soon to become a way of life for the young business school graduate. He applied these teachings and philosophies not only in his personal life but in his business career as well. The Beginnings As a prelude to becoming a HomeVestors® independent business owner, Amerson owned and operated his own real estate appraisal company for seven years in the Dallas-Fort Worth area. It was during this time that he looked into HomeVestors as a way to buy just a few extra properties each month. In January 2014, at the ripe old age of 34, he bought a HomeVestors franchise and formed Amerson Properties LLC. Amerson’s intention initially was to begin this new opportunity only part-time. It did not take long, only a few months, before he made the decision to go full-time. In those few short months, he was already beginning to see the impact, complete with the flexibility he desired and more time to spend with his family. His family at the beginning of the HomeVestors journey was his wife, Jessica, and his son, Jack, now 8 years old. It has since blossomed to include daughters Brooklyn (6), Whitney (4), and Bryn (4 months). Jessica’s passion is her family, and after seven years of working in the advertising industry, she is now thrilled to be a full-time mother and supporting Kyle’s business goals. The Amerson Way of Doing Business When Amerson looked at HomeVestors, he saw several additional attractive features that made his decision a “no-brainer.” “Not only did I envision a lifestyle change, increased flexibility, and more family time, but I also saw a proven wealth building system. Most importantly, I saw an opportunity to be able to help sellers out of ugly situations with their houses,” he explained. “My goal is to find the best solution for the seller whether I buy the house or not.” His servant-leader attitude and faith in God also guide him in his role as a Development Agent (DA) in the DFW market. “I’ve been a DA now for six months and I am very excited about the opportunity. I have always had a passion for training, so I love helping new franchisees get started and grow their businesses by coaching them on how to use the extensive tools and systems provided by HomeVestors. One of the things I teach is if your only goal is to buy the house, you’ll buy a few. But if your goal is to solve a problem and help people, you’ll buy many.” Present Day Amerson Properties, a single-operator business (read no staff), buys 35-40 properties per year, a combination of fix-and-flips, buy-and-holds, and wholesaling, and sometimes owner financing for families that cannot get traditional financing. As a single-operator business, Amerson answers his own phones, makes his own appointments, makes his own travel arrangements, and even empties the office trash. Amerson’s key to success is simple: Create “win-win” situations. If your goals are to solve sellers’ problems, it is hard to fail. Faith has always been a huge part of Amerson’s life, and he credits his faith for where he is today. Faith, plus his servant-leader philosophy, is a genuine recipe for success. HomeVestors What exactly does it mean to be a HomeVestors® business owner? Owning a real estate business is life changing and naturally comes with risks! When you become a HomeVestors business owner, you get immediate access to motivated seller leads, financing resources for qualifying purchases and repairs, one-on-one coaching with your local Development Agent, proprietary software for analyzing properties and deals, and access to a nationwide network of coaches and peers. Your house-buying business is yours and you run it as your own venture with a focus toward your individual business goals. If you are interested in a franchise, call 855-454-4578. Each franchise office is independently owned and operated.

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SFR Investors Data Preferences and Uses

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Only a Small Percentage of SFR Investors Take Advantage of Readily Available Key Data Points By Kori Covrigaru SFR investors collect and utilize property data for various reasons, but surprisingly, many do not take advantage of the full gamut of benefits. In a recent survey we conducted, PlanOmatic found that out of a total of 1,893 responses, property data collected onsite was mostly used for property maintenance purposes, which accounted for 24.9% of the total responses. This was followed by portfolio forecasting, which showed a slightly lower contribution at 21.4%; and renovations and acquisitions represented 19.6% and 17.6% respectively. In stark contrast, the category with the lowest percentage of responses included valuation, accounting for 16.5%. When asked which data points SFR investors need to assess a property acquisition and/or determine maintenance, where respondents could select from multiple choices, geographic location (busy street, commercial district) ranked the highest with 6.5% of the vote. This was followed in a second-place tie by “basement or crawl space” and “exterior general condition” with 5.7%. With a slightly lower percentage, 5.3%, “exterior surface” was the third most important data point needed. Scoping repairs for SFR properties is crucial for investors in order to thoughtfully plan for renovation costs and turn estimate time. According to PlanOmatic’s survey, RenoWalk is the most used software amongst SFR investors and owners for scoping repairs, accounting for 29.3% of the total responses. The second most used software is HappyCo with 28.6% of total responses. Facilio and Verisk/Xactware are ranked third and fourth, representing 26.8% and 14.6% respectively. The nationwide survey was conducted Nov. 2-4, consisting of an online survey of 1,893 respondents comprised of SFR investors, owners and developers. The booming SFR market is showing no signs of slowing down as investors bet that demand for suburban homes will continue to support higher rents. Investors are looking for ways to gain a competitive advantage, and as such, the focus on how property data and technology solutions aimed at optimizing both investment strategies and property management processes has become even more important. Traditional home inspections work great for traditional home buyers. Investors and property managers need something different. The details about the location, renovation specifics, and rentability of a property are key factors in the due diligence process. Our survey indicates only a small percentage of SFR investors, owners, operators and property managers are taking advantage of the key data points that are readily available at every property. Property data and technology will continue to play an increasingly key role in the SFR space in 2022 and it is time for investors to take advantage of the benefits to stay ahead of the competition.

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Digital Curb Appeal Drives Value in BTR

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Today’s Residents Have Higher Tech Expectations By Peter A. Gudmundsson In many industries outside of real estate, products and services evolve according to a technology adoption curve. This means that today’s luxuries become tomorrow’s must-have requirements, fast. Think air conditioning, power door locks on cars, wireless internet connectivity, or even home kitchen refrigeration as examples that started as novelties, became modern conveniences, and ultimately baseline prerequisites. Technology deployment in the Build to Rent (“BTR”) space is experiencing that same rapid evolution from exotic early adoption to “if it is missing they must have cut corners” judgments. BTR as a market provides two challenges that become opportunities when addressed with modern home management technology: The mastery of distances between units and operating processes for efficient management. The fast-growing convenience and efficiency expectations of today’s rental residents. Modern property management platform systems offer so much more than just independent smart locks, thermostats, and access control. While it is true that these are the building blocks of many adoptions, leaders in BTR and other sectors properly see these tools as only the beginning. The best lens for considering technology is to bifurcate consideration into what is best for the physical asset itself, that is to say the building and property, and what pertains to the people who live and work there. It is the unity of the physical asset and the operating processes in the context of superior resident experience that sets the best run properties apart. Asset Protection and Control Beginning with the hardware assets required to outfit the property, the earlier one considers technology considerations, the better. For example, smart devices like locks, thermostats, leak and noise detectors, lighting controls, and security equipment need not cost much more than their analog or “dumb” antecedents. In fact, many builders are relieved to learn that only a small incremental investment in hardware and devices over the sunk cost of incumbent hardware is required in many cases. When chosen carefully, today’s open software can work with many different manufacturers and models. Other providers will present hardware/software combinations that are elegant in their fusion but do not “play well with others.” Since optionality is critical, prudent builders will choose open software that will still be relevant when new hardware or software is acquired. Efficient Operations, Risk Mitigation, and Enhanced Revenue Managing and marketing BTR units can be labor and cost intensive. Centralized visibility and control at the unit level can save innumerable hours of work when it comes to managing a BTR property or property group. When all hardware is connected to a unified management system or dashboard, maintenance personnel, for example, can prioritize their routes and tasks based on real time activity rather than spot checking statuses of disparate systems throughout the development. On the marketing side, self-guided tour technology allows leasing personnel to focus on demand generation and lease closings rather than repetitive showings to prospective tenants who may only be kicking tires. Leaks are risk events that should be mitigated; not remediated. For as little as five dollars, a connected system inclusive of leak detectors alerts maintenance at the leak’s inception, helping to avoid water damage or mold. Regulations and common sense drive the deployment of smoke and heat detectors, but water, a greater risk than fire, should also be part of a mitigation plan. Some insurance underwriters will even offer financial incentives for integrated detection systems. Finally, the use of a modern property management platform solution allows the manager to not just save money through efficient operations but also generate incremental revenue through the assessment of a technology access fee to current and future renters. At all price levels, renters will not object to $25 to $50 of incremental monthly fees if they believe they enjoy state of the art technology access. Renter Experience and Expectations To state it bluntly, renters will judge your property if it lacks modern technology for access, security, energy, convenience, and insight. Remember, these are people with modern technology in their pockets, on their wrist, and in their cars. They will judge a new or old property as deficient if the technology base is not current. Think about how you react when you stay at a hotel where the WiFi connection is spotty or weak. Most make sweeping judgments that if the connectivity is poor, one must wonder what else is substandard. Residential property brands and locations are equally vulnerable to the expectations of today’s renters. A savvy renter wants to know that they will be able to moderate their energy usage from day one. They will want to turn on lights or grant access from far away or know if the noise level of their party is too loud before it triggers a visit from local law enforcement. A property that features up-to-date technology will offer “digital curb appeal” complementary to the additional investments made in landscaping and a friendly, professional leasing team. Marketing data shows that most renters seek community when choosing a home to rent. Community is an intangible concept, but most know it when they see it, and all agree that it begins with communication. This is why a property management platform needs to offer built-in communication that ties together the management of assets and processes. Has the gym access code changed? Will Taco Tuesday still occur at the pool if it rains? Will scheduled roof maintenance be moved to next week? Is the electric vehicle charging station available? These and more are the types of questions that residents need to be answered in real-time. Today’s residents have higher expectations for their rental residence, whether it is a studio apartment or single-family home. No longer will fresh paint and billboards suffice when it comes to attracting and retaining high quality residents. A well-run and technology enabled rental community will drive revenue, conserve costs, and provide the resident experience that will set your property apart. Whether a BTR investor intends to own and operate for the long haul or sell to another

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Boise, Idaho

The City of Trees Still Has Room to Grow By Carole VanSickle Ellis Boise, Idaho, has long been a center for travel and trade. Since the city’s founding in 1863 at the intersection of the Oregon Trail and trade routes connecting Idaho City and Silver City, it has played a central role as a meeting place for merchants and business operators. Today, Boise, also known as the City of Trees, is home to three Fortune 500 headquarters (Micron Technology, Boise Cascade, and Albertsons Companies), six colleges, and more than 749,000 residents with a population growing faster than all but one other metro area in the United States. Boise has made headlines for several years now thanks to that rapidly growing population. In the Realtor.com “Top Housing Markets for 2022” report published in January of this year, Realtor.com chief economist Danielle Hale noted a “concentrated influx” of residents streaming into Boise from West Coast cities including San Francisco and San Jose, California, in particular. “The strong local economy…attracts outsiders,” she observed, noting that Boise is particularly attractive to individuals seeking remote work opportunities and STEM (science, technology, engineering and mathematics)-related jobs, of which Boise has a slightly higher share than most other markets nationally (6.9 percent vs. 6.5 percent). Hale also pointed out Boise remains more affordable than comparable cities with its median asking prices just over $500,000 in late fall of 2021 compared to Seattle’s median asking price of about $767,000 and Silicon Valley’s median asking prices nearing $1 million. Relative Affordability and Inventory Thanks to relative affordability in Boise compared to the places from which many out-of-state buyers are moving, the city is likely to remain “hot” in 2022 despite already experiencing astronomical growth in 2019, 2020, and 2021. “We are still bringing so many more people in [than are moving out] and the people moving in have such a higher buying power than our locals,” observed local broker Brett Hughes in a December 2021 interview. Hughes said that inventory is the biggest stumbling block for anyone hoping to participate in the Boise boom because it is so difficult to access housing of any type. In December, inventory levels were actually up 150 percent year-over-year, but that simply meant that there was about one month’s supply of housing available for purchase. For comparison, “healthy” housing markets are generally considered to have between four and six months’ worth of inventory. Because of buyers’ much higher buying power compared to local buying power and the steady influx of new residents into the area, most local analysts agree that Boise has at least one more year of rampant growth before the market starts to cool – and more than that if the housing inventory can be increased during that time. However, not everyone agrees with this analysis. Professors at Florida Atlantic University and Florida International University published an article in December 2021 stating that Boise is, in reality, America’s “Number One Overvalued Housing Market.” These researchers calculated homebuyers paid a premium of 80.51 percent in 2021, followed by Austin, Texas; Ogden, Utah; Provo, Utah; and Phoenix, Arizona, with premiums of 50 percent or lower. The team predicted that a “pricing crown” would develop in their top-five overvalued markets in 2022 and, when that happened, home values would level off. Ken Johnson, a real estate economist at Florida Atlantic University and one of the authors of the study explained, “A crowning in prices is common when markets reach the peak of their current housing cycles. It does appear that several areas around the country are at an inflection point.” For investors considering acquiring assets in Boise, this information should not necessarily mean that they steer clear of the city until the inflection point hits. After all, many of the area’s newer residents are in a position to pay premium prices thanks to the sales of their own West Coast homes, and a city boasting more than 200 days of sunshine annually, low corporate and personal tax rates, a cost of living that is nearly 1 percent lower than the national level, and a vibrant arts community is likely a compelling place to get into a bidding war. The key to success will be predicting just how much of a premium those buyers will be willing to offer and for how long. Fix-and-flip projects and renovations on rentals should be budgeted and timed to get them to the market as quickly as possible in order to take advantage of current market conditions. Barron’s contributor and portfolio manager Ken Shinoda called Boise a “magical destination” and designated it a “Covid Metro” to which “homebuyers flocked…in expectation of living close to nature, free from the office.” However, he warned, some Covid metros are already showing signs of softness as “today’s world is calling people back to the office, at least part-time.” The key in a market like Boise will be to closely monitor trends in its West Coast “feeder markets” and react quickly if it appears that influx of high-powered buyers is starting to slow. “Easy, Non-Stop Access” in the Boise Valley Speaking of “back to the office,” one of the things that has made Boise so attractive to so many people from around the country is its proximity to many other 18- and 24-hour cities. The Boise Airport is located only about five miles from downtown Boise, plays host to more than 3 million travelers each year, and is not quite a five-hour flight away from New York City and just over four hours from Atlanta, Georgia. Boise is a tempting single hour from Spokane, Portland, Seattle, Salt Lake City, and Everett, Washington, and just two hours from Denver, Las Vegas, Los Angeles, Oakland, Palm Springs, Phoenix, San Diego, and San Jose. For those potential residents whose companies may be inclined to, as Shinoda described it, call employees back to the office in 2022 or 2023, Boise represents a good fit for once-weekly or -monthly commuters with the income or company funding to pay

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The Build-For-Rent Evolution

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Why BFR Communities Have Taken the U.S. Market by Storm By Mark Peterson As we head into 2022, the commercial real estate industry is continuing to see new Build-for-Rent (BFR) communities popping up all over the county. These BFR communities of newly-built detached or attached single-family rental homes have taken the U.S. market by storm in a few short years, helping to fill the immense housing shortage for renters and opening new revenue streams for builders and investors. There are 15 million households renting in the U.S., and current trends show we are turning into a nation of renters. Renters are allured to new single-family rentals for several reasons including the opportunity to have more living space with yards without having the responsibility of home ownership or having to produce a down payment. COVID-19 accelerated demographic changes, such as moving to suburban locations and working from home, escalating demand for BFR housing throughout the country. What happened in recent years to cause a surge of growth in Build-for-Rent? The BFR investment class reflects similarly to multi-family in its beginning phase. Institutional investors only comprised an estimated 2% of ownership in the 1970’s when multi-family got its start, which has grown to nearly 55% today. Looking deeper at the evolution of this booming asset class, key drivers – including agency financing, increased capital flowing into the asset class, optimization, technology and smart home advancements – have propelled BFR forward with the promise of massive growth for years to come. Breaking Through Financing Barriers One of the biggest challenges in BFR was the financing. Four years ago, BFR was not a proven asset class and it was challenging to convince builders that there were actually buyers interested in purchasing an entire community on a forward commitment. Back in the day, the top 20 SFR operators were just getting started with exploring or buying these BFR communities, and trying to convince these developers and builders that they would get a forward commitment from a big capital group that would commit to buying before the homes were built was a daunting task. Before the institutionalization of BFR these SFR operators were exploring the asset class because they realized their capital expenditures on these scattered homes were high and some of the inefficiencies that ran with managing homes scattered across an MSA would be overcome by buying homes that were all in one community. Fannie Mae and Freddie Mac provided financing on scattered home portfolios as a pilot program for each agency for a brief period. Each entity provided about $1B in debt, most of which was absorbed by the big capital groups to finance large acquisitions. This financing was not available for the BFR acquisitions. SFR experts, such as SVN | SFRhub Advisors, the first commercial single-family residential and Build-for-Rent dedicated brokerage in the country, were an integral part of working with the agencies on educating them on how BFR operates as it was an asset class they had not studied before. After years of studying BFR deals, Fannie Mae and Freddie Mac learned how a self-contained community operates even more efficiently than a multi-family community, increasing their interest in determining how to provide debt for the asset class. Working with preferred partners, such as Walker & Dunlop, underwriting criteria and programs were created to introduce to builders, developers and capital alike to provide acquisition financing. This evolved into programs for development debt along with vertical construction and bridge loan financing. Bridge loan financing allowed investors to acquire the homes at certificate of occupancy in tranches through the course of the build-out of the community that was then rolled into agency financing once the community was fully complete and leased. The permanent financing is the same debt programs the agencies use for multi-family financing and requires showing a trailing three-to-five-month history of occupancy and operations. This option did not become available until 2019 and was never fully marketed. It was a huge boom in pushing the BFR asset class forward as investors learned agency financing was available for self-contained BFR communities. With true agency debt now in place – arguably cheaper than the typical SFR private lending debt that was available – all the new capital comprised of commercial investors, multi-family buyers and single-family operators entered into the BFR playing field. Opportunities for Optimization At the time, buyers were primarily SFR groups, used to scattered lots, who were buying the first or the last 5% to 10% of a community and were not involved in the designing or developing of purpose-built communities. The builders would determine the floor plans and finishes in the homes leaving the buyer or investor to select from the limited options, or even standing spec inventory, resulting in suboptimal returns. Rather than having the ability to select finishes ideal for a rental unit, such as vinyl plank flooring, durable countertops and stainless steel appliances, these newly developed homes would include higher-end options you would find in a for-sale product. Builders of BFR communities are now purpose designing homes and selecting materials to withstand wear and tear to minimize repair and maintenance and turn-over costs, including laminate faux wood flooring, minimal carpet, seamless countertops and limited front/rear yard landscaping, according to John Burns Real Estate Consulting (JBREC). Lot size is far less important to renters, but community amenities offered in larger communities can be an important draw. Top desired amenities offered include on-site management and maintenance (61%), a pool (50%), a clubhouse (35%) and walking trails (31%), based on an analysis of JBREC Build-for-Rent database. Builders and developers now consult with industry leaders, such as SVN | SFRhub Advisors, to complete a conceptual analysis of every site to ensure builder savings and maximized returns. These experts will review nearly a dozen floor plans to evaluate what the returns per floor plan are in addition to researching the current market, MSA trends and characteristics, rental trends and demographic data. The importance of optimization cannot be overstated. The table below depicts an

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