Guardian Asset Management
The First Line of Defense in Property Preservation
By Carole VanSickle Ellis
When Jerry Mavellia and Dan Leader, CEO and COO for Guardian Asset Management, respectively, formed their company in 2007, they did so with the knowledge that there was going to be an increase in foreclosures and defaults that would necessitate their services. “There was a real need for repairing and restoring properties as well as preserving and preparing them for resale,” said Mavellia, who had founded his first asset management company specializing in property preservation in 1995. After selling that company, Mavellia and Leader teamed up to create Guardian Asset Management in order to provide the housing industry with what they describe as “a forward thinking, client-centric national inspection, maintenance, and repair company.”
“Property preservation is not easy,” Leader noted. “You do not get to pick and choose property location, and we function as ‘first responders’ when distressed assets come into inventory.” With a cumulative experience in excess of 50 years, Leader and Mavellia were perfectly suited to the challenge.
In 2007 alone, lenders started foreclosure proceedings on 1.3 million properties, and another 2.3 million entered the pipeline in 2008. When a property enters foreclosure, asset preservation specialists are entrusted with the care of the outside and, in some cases, inside of the property — even if it is occupied in some cases. In the mid-2000s, not many companies were equipped to handle the volume and severity of the onslaught of foreclosures that hit lenders’ books all at once.
Guardian Asset emerged in time to work closely with government agencies, servicers, large and small banks.
The company set as its “true mission” the development of client-centric partnerships. “This mission is both rewarding and, at times, challenging,” Leader acknowledged. “We have taken over some areas that our predecessors had found to be tough markets, and we were proud to help make those communities better places to live,” he said. “We are not just serving our clients; we are serving and restoring communities by helping preserve properties for resale and improving the overall value of local real estate.”
Treating Clients as Partners in the Process
One of the benefits of being in the business of property preservation for decades is a clearer view of the real estate and lending industries that newer entrants to the sector cannot leverage. Leader explained that at Guardian Asset, all employees prioritize the relationships between company and client. “We do not look at ourselves as vendors,” he said. “It is a true partnership.”
This partnership element means that Guardian Asset incorporates a dedicated client service team and client performance metrics into its own evaluative processes when dealing with daily operations.
“We play an integral part in the success of our clients’ operations, so we prioritize hitting deliverables, helping them achieving favorable ratings on servicing scorecards, and assist clients navigate the evolution of requirements from federal agencies, banks, and other lenders,” Mavellia said. “We are so much more than just being the vendor that cuts the grass and takes out the trash.”
Asset preservation, when applied to the concept of real estate, is certainly far more than boarding up a few windows or changing the locks on an abandoned property. It can also involve performing inspections on a property, winterizing it or protecting it from severe weather, estimating and managing repairs, and ongoing maintenance work. Lenders and others holding real estate as collateral rely on property preservation specialists to help them keep assets in good condition so that they retain or rise in value and may ultimately be marketed and sold in order to redeem the money lost on the nonperforming loan.
“It requires a certain mindset from everyone in the company,” Leader said. “Our workforce needs to have the mindset that we are going to step in and take action to make the properties safe and secure so they can be marketed to the general public all while adhering to regulations put forth by government agencies and local municipalities.”
This mindset also requires serious attention to detail, as banking regulations and the expectations of lenders have become much tougher since the housing and mortgage crises. “Quality reporting and documenting the work we perform has certainly become a focus in the industry,” he said.
Part of treating clients like partners in the preservation process involves sending out only the best and most reliable service providers to those clients’ properties. Unlike most property preservation service providers, Guardian Asset maintains its own field crews of W-2 employees in key positions within the United States. Mavellia and Leader view the move as a demonstration of their commitment to clients and quality control, calling it “an insurance policy for our clients” because they are committed to having staff in “high-touch areas” and high-volume areas.
“We are not just passing orders down to other contractors or vendors,” Mavellia explained. “We know who is at a property and what services they are providing. Having our W-2 guys in the marketplace is another layer of risk mitigation and protection.”
Combining Service, Experience & Technology
With an eye toward risk mitigation and reliability, Guardian Asset has incorporated innovative technology into its processes. The company uses a full-service property management platform with both client and vendor portals to optimize transparency and create a smooth management environment in the process.
“We have a dashboard reporting module that enables our clients to view real-time reporting and progress of services ordered, and that platform integrates with other industry platforms like Black Knight and Yardi seamlessly,” Mavellia said. He noted that the company also offers mobile solutions and encourages vendors to use these tools to “route their days” to optimize completion of preservation and inspection orders.
“Our platform leverages technology like GEO-tagging to create a ‘fingerprint’ to prevent mistakes when it comes to which properties are entered, inspected, or preserved,” Leader explained. “The photos taken through our mobile applications are automatically stamped with date, time, and GPS location data that is tamperproof.”
Since property preservation sometimes involves entering and securing properties, as well as repairs and maintenance, this type of photographic record is invaluable in preventing mistakes and protecting clients.
“We treat the entire process as risk mitigation,” Leader added. “You cannot complete an inspection, or any other task, without working through key identifying questions that are verified through machine learning that establish that the right service is being provided at the right property.”
The chain of events in a work order for Guardian are analyzed by machine learning technology, which recognizes identifying elements of the property and the work order to ensure that the job is done correctly and will reduce further risk. For example, if a required picture is blurry or is incorrect based on the model associated with the question, the entire process halts.
“You cannot move through the process until you have taken the correct picture and documented the correct identifying elements of the property,” Mavellia explained. “This is critically important to our clients.” Guardian’s mobile application is another tool in their toolbox for quality control and risk mitigation.
The tools also help Guardian’s service providers accurately and efficiently determine what type of damage, if any, exists in the property. Sometimes, this technology even identifies issues that may be missed by human eyes. For example, if an inspector has noted a need for a new gutter but is not able to view all angles of a roof, a picture of that gutter may contain enough information for the software to recognize that there is a roof issue as well. Then, the program alerts the vendor and the dedicated Guardian project team of the need to manage additional repairs.
“We have also tied this part of the software to an industry leading cost-estimating tool that will generate the actual scope of the repair, line items in the repair, and other information based on the photo,” Mavellia said proudly. “It is just another way we manage risk mitigation for our clients.”
Sidebar 1
Guardian Asset Management by the Numbers
22.5M inspections completed
8.2M properties secured
8.7M properties maintained
5.6M homes repaired
15 years in business
75 Guardian Asset’s leadership team has more than 75 years of property preservation experience
Guardian Asset Management at a Glance
Business Model
W2 field employees
National, qualified vendor network
Technology
Industry leading workflow technology
Mobile application with ML
Sectors served
Bank
Servicers
Government Agencies
Services offered
Inspections
Property preservation
Conveyance/claim/REO repairs
Single Family Rental services
Utility, VPR and HOA payment services
Appraisal and Title Services
Coverage areas
National
Sidebar 2
The First Line of Defense is a Solid End Solution
When Guardian Asset collaborates with a client, the company makes no bones about its determination to provide cohesive solutions to its customer. As a result, Guardian Asset has evolved into providing a vast array of services associated with property preservation from beginning to end of the process. This includes title work, appraisal services, and bundles of other products and services.
CEO Jerry Mavellia explained, “We are not trying to be everything to everybody, but we do emphasize offering core features of preservation, property management, appraisal services, and title services so that we can fully serve the client and protect the property.” He continued, “For example, it just makes sense when we are looking at the condition of a property, the cost of repairs, or the value of different repairs, that we are able to help our clients with good appraisal products.” Although Guardian primarily serves the larger banks and servicers in the industry, they prioritize the ability to bundle and customize their products to meet all their clients’ specific needs.
“We are basically their first line of defense,” Mavellia explained. “We are the first ones out in the properties with a good idea of what the property needs and how that will affect the value of that property. It is our responsibility to be a solid end to end solution for each of our clients.”
Sidebar 3
Coming Off COVID Could Create New Opportunities for Individual Investors
As the COVID-19 pandemic transitions away from its initial “global emergency” status into something a little more, well, endemic, the national housing market is reacting in predictable ways. As forbearance programs run out and make-up mortgage payments are owed, markets around the country are beginning to soften. While homeowners who might have faced foreclosure under similar circumstances in the early 2000s have more options today thanks to skyrocketing home values during the pandemic, Guardian Asset Management COO Dan Leader emphasized there will be “more foreclosures in the works” as things return to normal.
Interestingly, part of that return to normal could be a reemergence of the individual investor in the single-family rental market.
“Over the last 10 years, we have seen a lot of institutional buying in terms of large hedge funds and firms buying single-family homes for rentals,” Leader said. This dominance in the market has diminished opportunities for smaller operations and individual investors, who cannot compete with the massive budgets and sometimes razor-thin margins big firms can tolerate during acquisitions. “There will certainly be opportunities for institutional buyers,” Leader continued, “but if rents continue to rise – and we would expect them to do so even as appreciation levels off – there are going to be more properties where the cost is worth it.” In some markets, this could create an environment where individual investors once more are competitive in acquisitions.
Guardian CEO Jerry Mavellia added that investors could continue to see “a real push” in suburban markets, compared to a decade ago when households were moving back toward city living.
“It is all about demographics,” he explained. “Younger people tend to like cities, but as they get into their 30s and 40s and start having children, they want to rent in suburban areas.” Mavellia predicted that the rental market for these households is likely to pick up even more in the coming months and over the next few years.
“The economics and demographics work for that,” he concluded.
