AvenueWest is proud of its over twenty-year tenure as a reputable corporate housing provider, and our CEO Angela Healy has been with the company since practically the start. Building on a record-breaking year, including the company’s listing at #435 on Inc Magazine’s fastest-growing companies and 2nd fastest growing company in Denver, and ahead of ongoing franchise expansion, we caught up with Angela to share a bit more about her background and what’s ahead.
You are a licensed realtor. What drew you to real estate in the first place?
My parents had a small, successful rental business on the side of their regular jobs. This business had enabled them to put all four of their kids through college. From observing their hard work, I knew property ownership made financial sense. As a result, I worked hard to purchase my own first property at age 24. After living in it for just four months, I turned it into a corporate rental and started getting my feet wet in rental real estate.
My professional career though, was in commercial banking with Silicon Valley Bank first in Palo Alto, CA and then in Atlanta, GA. That job placed a lot of demand on me, and I was traveling all the time. I was probably away more than I was home. Starting in 2001, I began working with AvenueWest part-time in the evenings, managing their accounting. In my day-job, I was looking for a change and also contemplating moving to Denver to be closer to family.
An opportunity with Silicon Valley Bank in Boulder opened up, and I flew in to interview. While out here I took the opportunity to meet with the AvenueWest team. They said, “if you’re going to move here, why don’t you work for us full-time?”
It just made sense, and I started full time with AvenueWest as their CFO in 2004.
Happy 20-year work anniversary! How did you first learn about AvenueWest?
I knew the original AvenueWest owners from college. In June 2001, they called me and said, “hey, when your banker says this what does it mean?” It wasn’t a good prognosis, so I booked a flight and met with their banker the next morning. I said, “I have no idea what I am getting into but give me a week to review the company’s financials.” Their banker agreed. Within a week, I knew I could turn it around. They hired me part-time in the evenings to manage their accounting.
We refined the business model around property management for corporate housing, and by August, the company was profitable and doing well again. Then September 11th hit, but because of the new foundation we instilled, we were able to weather that storm. The piece of business we kept in place was a very sound business model, and that’s what AvenueWest is founded on today – property management of fully furnished rentals.
What is the business model that sets AvenueWest apart?
If you look at property management across the board, the majority is unfurnished rentals. Our inventory is furnished. Yes, there is a capital commitment to furnish the rentals, but we bring in a better rate of return for the investor in the long run.
People will ask, “why can’t I do this on my own?” You can, but the majority of individual corporate housing owners will receive lower rents and not have access to the larger corporations with larger budgets for rental properties. The large corporations pay more, but they need more than just one property owner with one unit.
They want a partner that can bring them all the properties they need, and they know we have high standards. Moreover, they trust us that if something goes wrong, we will respond quickly and appropriately. Using our relationships and track record, we can be a turnkey partner for corporations across the country.
What role do you personally play in establishing and maintaining AvenueWest’s culture?
Definitely the spearhead — culture is everything to us. With every new franchisee, we are interviewing them as much as they are interviewing us. We have to make sure that they are committed to the quality of service that we are going to provide.
Since 2017, AvenueWest has grown to represent $150 million in residential assets under management. Yet 2020 brought corporate housing to a near standstill. How did AvenueWest persevere?
We decided not to sell another franchise and instead focused on our existing 15 franchises to make sure they survived. We started doing weekly owner calls. We worked together to apply for the U.S. Government’s PPP loan. Then, once we had the opportunity to get a little more capital, we started looking at our booking trends. We found that some people stayed in our rentals rather than return to a COVID hotspot.
Next, we looked into who we could support with housing needs outside of the traditional corporate housing industry. We discovered it wasn’t companies moving people, but rather professionals who were working from home and wanted to leave areas with high infection rates. We doubled down on these trends and shifted our marketing and approach.
By early July, most of our offices were back to regular occupancy. Once we started gaining momentum, we were able to really turn it around. Ultimately, in 2020, the franchise had a growth year and ended up #435 on Inc Magazine’s 5,000 fastest-growing private companies list. In fact, we are ranked 12th for fastest-growing real estate business in the entire U.S. We didn’t just survive, we thrived!
As AvenueWest grows, what makes a good market for corporate housing?
We thrive in the second and third tier cities. Some of that comes down to competition; most big corporate housing companies already have inventory in say Chicago or Los Angeles. But we can service the suburbs of the big cities, or smaller cities, such as Huntsville or Salt Lake City, and be successful. It doesn’t take a lot of properties. Our target for a franchise market is to get to 30 properties.
If there’s a university nearby, that can help too. Fort Collins, for example, has done very well for us as companies like Microsoft and Apple have congregated there because of the intellectual property coming out of the university.
We also look to be near military bases. The government is the number one user of corporate housing, so our Colorado Springs office is very successful. Our clients are sometimes the government, but most of the time it is the contractors coming in to work with the government.
How is AvenueWest affected by the tight supply of properties on the market in 2021?
We are definitely in short supply – and our growth is capped by inventory. If I could have 10 or 20 more properties in every one of our cities, we would be booked. In many cities, corporate relocations are on hold due to the industry-wide housing shortage. They can’t find the properties, the moving trucks, the labor, and even the wood for the pallets they use in the trucks are all in short supply. So, the silver lining is we are having a very good winter quarter, which is usually slower for us than the summer.
What’s next for AvenueWest?
We recently hired the Franchise Consulting Company, a broker for franchise ownership, to expand our locations. My goal is to double the number of franchises in the next four years. We doubled it from 2017 to 2020, and believe we can do it again. Who knows, we may even reach that number sooner.