Your home away from home
Business View Magazine interviews Angela Healy, CEO of AvenueWest, for our focus on Excellence in Real Estate Property Management
The numbers and trends suggest that the longer COVID-19 forces people to work remotely, the more companies are adapting to new work styles and the more employees want to keep working outside of their office space after the pandemic ends. What’s also clear is that the coronavirus has broken through many of the corporate-cultural and technological barriers that prevented flexible work arrangements in the past. And as these structural shifts in where work takes place continue to occur, a vision is being delivered in which the real estate of the future is as livable, sustainable, and fluid as the concept of the modern workplace itself.
For Angela Healy, CEO of AvenueWest and its franchise program, AvenueWest Global Franchise, that future involves a corporate housing community that recognizes the need for versatility – due to the unprecedented changes that have impacted how corporate rentals are being sourced, transacted, and maintained. That’s why she’s grown her company (which she co-owns with husband, Tim) to be the kind of business that wants to be the difference-maker in an industry that, historically speaking, has not seen a great deal of innovation.
“We started as a real estate brokerage in Denver and quickly learned that what we were doing within corporate housing was unique and very different,” Healy shares. “Traditional corporate housing will rent apartments and furniture, lending a corporation a kind of rental property. What we were doing was managing other people’s properties. So, we were able to provide homes, condos, and townhomes – spaces that felt a lot less transient in terms of the home environment.”
Healy also found that the risk they were taking with the property as an asset was considerably lower than it would have been if they were simply leasing and subletting apartments. “Instead, we were entering into a partnership with the property owner,” she explains. “As we moved through our history (AvenueWest Corporate Housing launched in 1999), we were able to survive all of those major economic downturns. Meanwhile, a lot of our competition was going out of business.”
Feeling confident that their business model was sound, they turned the brokerage into a franchise and became AvenueWest Global Franchise in 2010. Today, they’re one of the top 500 companies on Inc. Magazine’s list of fastest-growing companies, ranking 435th with three-year revenue growth of 1,127%. They also scored the number two spot on the Denver Business Journal’s Fast 50 list for 2021.
“We’re up to 15 cities,” Healy confirms. “We have San Francisco and Sacramento. Las Vegas and Reno. We’re in Phoenix, Scottsdale and Tucson in Arizona. We’re in five cities in Colorado – Fort Collins, Boulder, Denver, South Denver, Denver Tech Center, and Colorado Springs. We’re in Dallas, Texas, St. Louis, Missouri, Raleigh, North Carolina, and Atlanta, Georgia also.”
Healy and her husband purchased the franchise business in 2017, growing it from seven franchisees to the current 15 during their tenure. “We’ve more than doubled in that four-year period and our goal is to double again over the next four years,” she declares. “We’d like to have 30 cities by 2025, and our current franchisee in the Denver Tech Center – he’s actually Canadian – is looking at opening Avenue West Canada for us. So, that’s in the very early stages.”
When it comes to courting a good AvenueWest franchisee, the criteria is fairly straight-forward. According to Healy, “It’s someone who’s willing to roll up their sleeves and put in some hard work. They also need to be a real estate broker because we’re managing other people’s properties and need that designation with the State. Right now, the landscape of real estate is really changing, with the addition of Zillow and other platforms that are making it more difficult for us to find buyers versus buyers doing it themselves. We’re finding that realtors are always chasing the sign; they’ve got to have one more sign in the ground to get their next sale. And they work on commission, so if they don’t sell something, or they don’t help someone buy something, they’re not making any money. What we’re offering is the ability for a realtor to get recurring monthly income. Because every month when there’s rent, you’re receiving a portion of that rent. So, the more properties you add into your program, the more recurring revenue you build up.”
In addition to collecting a percentage on the rent, realtors can potentially help clients who are relocating to purchase their new home. There are also opportunities to assist investors. “If you have an existing property in your program, and that investor needs to sell or do a 1031 exchange, you’re right there and can help them do that,” Healy says. “So, it’s a lead generator for buying and selling real estate, which gives you more stability.”
She emphasizes that AvenueWest isn’t interested in bringing in investors who are merely looking to buy a franchise, hire employees, and let someone else do the work for them. “That’s not us,” she affirms. “There are plenty of other franchises out there where you can purchase into that model. We’re looking for the entrepreneur on the ground that can nurture those relationships with their investors and corporate clients. Because in our business, it’s 100% those relationships that make that city successful.”
Corporate travel was disproportionately affected by the pandemic and has been slower to resume than other segments. The AvenueWest business model is constantly being fine-tuned to be more responsive to the needs of business travelers, shaping to new expectations as far as comfort level and personal situations are concerned.
“If you think about it, corporate travel pretty much came to a halt at the beginning of COVID,” Healy elaborates. “People were moving out of California, New York, Washington, and scoping out these smaller cities – second-tier markets – many of which we’re in. So, we were prepared for that mass exodus with our inventory mix of larger properties, especially homes, when executives were relocating their families. Instead of doing corporate travel, we just helped those individuals who were fleeing from the pandemic.”
Unlike Airbnb rentals which are short-term and can often feel sparse (or, on the flip side, a bit too personal), AvenueWest’s properties are full-time rentals, maintained by a professional, 24/7 management service. The company offers both furnished/monthly and unfurnished/long-term options that cater to every individual’s needs and personal preferences. “They’re not someone’s primary residence who’s away on vacation,” Healy attests. “Everything is set up like a rental. There are no extra personal effects. All the closets are yours. The refrigerator and pantry are empty. You have space to move in and make it your own versus feeling like you’re staying over at someone else’s house.”
AvenueWest places a 30-day minimum on all rentals, which allows them to be in the kinds of properties that Airbnb and other “weekend special” platforms can’t access because of short-term rental bans or HOA restrictions. About 95% of their properties are rented sight-unseen, and collections and evictions are “a non-issue” for the franchisee.
“We get professional photos taken of every one of our properties, so you’re physically looking at pictures of the available rentals,” Healy notes. “It’s not like our competition, where they’re renting apartments, putting in rental furniture, and saying ‘this is a sampling of what’s available in this community’. We just launched our new website in March and iPoint Technologies created that for us. They’ve been a wonderful partner. We certainly love what they’ve done with it and it’s attracted a lot of great people.”
For their next phase of growth, Healy sees her company evolving into an even more nimble and adaptable brokerage, one that anticipates how people can and could interact with their new live/work arrangements post-pandemic.
“As the millennials are getting older, I think they like the idea of saying, ‘I’m going to live in Denver this month, and I’m going to live in San Francisco next month,” Healy acknowledges. “They like being unattached, having less commitments, so that they can travel and live all over the U.S., especially with the way remote work is playing out. To them, it’s the experience, and I think that trend is going to continue. I also think that consultants traveling Monday through Friday and going home for the weekend, that’s kind of out for a while. Mainly because they don’t want to be hanging out in airports as much. So, the family unit traveling with them, that’s likely going to stay. As a result, that single-family home piece of what we do should really see significant growth. We can offer you a fenced yard. You can bring your dog. Our product is uniquely positioned for this new phase we’re moving into.”
AT A GLANCE
What: Fast-growing, managed corporate housing brokerage and franchise company
Where: Headquarters in Lakewood, Colorado