Larry Connor: apartments as operating businesses
Richard's interview with Larry Connor began with how Connor approached apartment ownership. Connor described buying businesses with daily customers and operating expenses, even though the assets happened to be apartment communities.
The building and the operation
Connor distinguished a well-located, physically maintained property from a well-run operation. He discussed resident service and pricing, along with the cost of running the property. Richard connected that distinction to having direct operational knowledge close to the property.
Who is paid on which result?
Connor contrasted his focus on bottom-line results with managers paid on top-line revenue. This is his description of the difference he pursued. The exchange identifies an operating question to investigate: whether the owner and manager are measuring and being paid for the same outcome.
In Richard's words
"having that boots on the ground operational expertise has got to be a real Edge" (Richard C. Wilson, recorded library conversation)
How to use this
- Separate physical condition from the quality of daily operations.
- Write down which result each operating partner is paid to improve.
Questions and answers
What distinction did Connor make?
He described apartment communities as operating businesses with daily work to manage.
What did Richard ask about?
The value of operational knowledge when competing with buyers farther from day-to-day management.