Stephen Waters, Morgan Properties’ senior vice president of facility operations and president of the New Jersey Apartment Association, addresses members at the organization’s annual meeting in 2018. — Courtesy: New Jersey Apartment Association
By Joshua Burd
Steve Waters knows it as well as anyone: The property managers, maintenance technicians and other on-site personnel are the backbone of an apartment community. They’re also critical to retaining residents and maintaining a property’s financial health.
“Without our site teams, we lose,” said Waters, the senior vice president of facility operations at Morgan Properties, which owns 10,000 apartments in New Jersey. “They’re the key to our success, by far. Buildings are just buildings unless you have residents to occupy them and people to take care of those residents.”
It’s why the veteran executive, as the president of the New Jersey Apartment Association, has focused on expanding the education and training available to on-site professionals across the state, through a membership that comprises more than 210,000 units statewide. Doing so has been a core initiative for Waters since the start of his two-year term and since he first became involved with the association’s executive board in 2010.
Waters has also made his mark in the realm of government affairs, from forging personal relationships with mayors to advocating with state lawmakers in Trenton.
“I think that Steve’s focus on government affairs and education really defines the organization,” said David Brogan, the association’s executive director. “And you can see, when we’re now more than doubling the number of students that we’re teaching each year, it shows that we’re going in the right direction, so I give Steve a lot of credit on that.”
Waters, who is entering his final six months as president, knows there is still much work to be done. Both education and advocacy will remain as crucial as ever in an industry that continues to grow and in a state that is rife with political uncertainty, high costs and a long list of regulatory and legislative challenges.
To discuss it all, Real Estate NJ sat down with Waters at the NJAA’s headquarters in Monroe.
Real Estate NJ: We know the association has doubled the number of students involved in its education programs over the last four years. As someone who has been in site operations and maintenance for 30 years, why is that so important?
Stephen Waters: If an individual owner hires somebody, it’s not like they have someone in the wings to just go train that one person and get them to the next stage of their career, but we do it here. We’re able to get them the education on capital improvements, maintenance-related items, leasing, fair housing and things like that, which are offered through this association but aren’t necessarily offered on the street.
RENJ: Would you say owners are more conscious of maintenance and responding to residents than they were 10 or 20 years ago?
SW: Much more — it’s incredible. The most difficult thing in our industry is to find qualified mechanical help and technical help out there. I think the world went to forcing a lot of people into furthering their education into college, which is good, but we also let go of a lot of the trades over the years. And we’re working on re-establishing that throughout the country. If you ask any owner what their No. 1 issue is right now, it would be maintenance and cultivating new maintenance technicians and maintenance professionals. And through the efforts of the apartment association, we are making it a reality with the training that’s going on.
RENJ: You’ve also been focused on government affairs since before you became president. What can you tell us about those efforts and how they’ve looked during your current term?
SW: Dave and his team have opened my eyes on how they and the NJAA do it — how progressive we are and just being able to reach out and talk to people, get them on the phone and work with them as a partner and work with them through these issues that we face on a regular basis.
We’re seeing changes every day and different things we’re being faced with. It’s challenging, but we’re working very closely with different legislators right now and educating them on the hurdles that we face. We meet with them, we discuss things, we take them for property tours — and we’ve been very successful in making that connection. But every day is a different hurdle.
RENJ: What are some of those issues that you’re facing?
David Brogan: I think the Legislature, by its nature, sometimes is reactionary. … You’ve seen the articles about substandard housing, but how do they address substandard housing without negatively impacting the entire industry? It’s hard to pass legislation that is so specific that it only affects those people. Generally, it affects everybody. So (it leads to) increased registration requirements, maintenance requirements and things like that. So we work with them on those issues.
Clearly, affordable housing has been a priority for the last couple of years and we’re continuing to work on that. … At the end of the day, we try to get to solutions, we try to help legislators find solutions to the problems that they have, while having them understand how that legislation is going to impact us.
RENJ: Steve, you’ve cultivated relationships at the local level. Who are these mayors? Are they mayors that have large apartment populations in their towns or are they just politically active? Or are they mayors that have a Morgan property in their municipality?
SW: All of the above. Some of it is through the apartment association. Some of it is because of issues that might’ve come up. Some of it is just finding common ground to solve different things within the community, because even sometimes we are dealing with the police and fire officials. We work very closely with them. Our property managers are connected with them because of the inspections that we deal with from code enforcement, fire officials and the police. If there are any crime issues, we play offense, we go to them, we give them access to our cameras, we give them access to our community.
If things need to be changed from a security standpoint — meaning lighting, landscaping, anything like that — we make sure we take care of it. … We’re extremely invested in New Jersey and in all of the communities, so working together benefits us in the long run.
RENJ: The association has added around 13,000 units to its membership over the past two years for a total of about 215,000. What is driving that growth at this point in the cycle?
DB: It’s existing owners who are expanding their portfolios. It’s the developers who are building new product. I think that when you look at apartment living, it’s truly the last true affordable housing — with a lowercase ‘a’ — that’s out there, so there’s a demand for it.
On top of that, you’ve got that sandwich effect: You’ve got the millennials who don’t want to buy anything because they’re going from job to job and they don’t want to be tied down. Then you’ve got the empty-nesters who are saying, ‘I still want to stay in New Jersey, but I don’t want to pay the (property) taxes.’ And the federal tax law has changed. I think that’s helped the industry, honestly. So there are a lot of things that are happening right now that are keeping the trajectory of the industry going, where in the past it may have fizzled out by now.
RENJ: Steve, your term as president will end next January. What do you want to focus on between now and then?
SW: One of the things (to address) is the duplication of fees and mandates that we’re seeing out there. We want to continue to work strongly with that because, right now, what we see from our site teams is that we have DCA inspections, we have a fire marshal inspection where they walk 100 percent of the units, we have code enforcement inspections, bank inspections and lender inspections. So a lot of that is complicating and it makes it difficult for our site teams to do what they should be doing, which is taking care of our residents. And sometimes it’s not about the fees, but the fees hurt, too. That’s a different mandate. It’s more weight on top of us that we’re trying to work through … with the state and local authorities.
RENJ: Once your term is over, you’ll become chair of the NJAA Charitable Fund. What are your plans for that?
SW: The good thing is that Dave, Nichole (LoPresti, executive vice president) and I have already started working on initiatives to do more, (with) bigger, better charitable events. We are going to do more with the different owners and the association and really help people out there across the state and help anywhere that needs it.
DB: This is a revamp and this is Steve’s effort to take our charitable efforts and expand it statewide. And I don’t think a lot of people understand how a lot of our companies already do charitable efforts. The one thing I say all the time is that these companies … are part of the fabric of the communities that they operate in and they’ve got a vested interest in those communities — not just the apartment communities, but the towns. So if they can help on a local level, with charitable efforts, they do. A lot of our companies do toy drives, they do clothing drives, they do other things and it’s one thing that we’re going to start promoting a little bit more.
As someone who preaches training, it’s no surprise that Steve Waters got started at such an early age.
The Morgan Properties executive grew up in the business, noting that his mother managed a Sheraton hotel in Fort Washington, Pennsylvania. He recalled going with her to work around age 10 and performing odd jobs with the housekeeping staff in order to stay occupied.
Waters would continue to do so when his mother went on to become the assistant manager of a large apartment community, he said.
“She was my mentor, ultimately,” Waters said. “She basically taught me and gave me my work ethic. She was up early, went to bed late and was always on time at work, and she just instilled these values in me all through my life.”
He has tried to maintain that standard during more than three decades in the apartment industry, having spent the last 19 years with Morgan Properties. The King of Prussia, Pennsylvania-based firm has grown during that time from 7,500 units in four states to 50,000 units in 11 states and is now the largest apartment owner in the Garden State.
“New Jersey is one of our core markets and that’s the reason why we’re here,” said Waters, the president of the New Jersey Apartment Association.
Morgan has moved in recent years to upgrade properties throughout its portfolio, adding amenities such as new fitness centers, putting greens and pet-friendly facilities. And when it comes to maintaining a knowledgeable, professional on-site staff, he practices what he preaches to other NJAA members.
“It’s not how many communities we have — it’s our people,” he said. “Our people are everything. If we don’t have good people providing good service and clean, neat, safe housing, we don’t succeed. That’s Mitch Morgan’s philosophy that I’ve adopted in my own career and I’ve lived it and breathed for the last 20 years.”