20 Years Leading NARPM: Gail Phillips on Property Management’s Evolution

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Pete Newbigg and I were talking one day and I said, Pete, why aren't we giving our chapters virtual assistants? So we realized that if we could give them some support, then those that are strong enough should flourish, right? Well, those that are strong have gotten stronger, and those that are weak are still weak. You look at the ones that are doing well, they have succession planning, they have people in line, some of them have hired their own staff, and they have somebody— because you all have a business to run. And that's the thing I always tell a president when they come in. Our job is to run the association. You have a business to run. The first time I heard a president say that being president hurt their business was— I was like, oh, that's not good because people aren't going to want to be president. But after they got out and people knew them, they saw that the positive it had, that it helped them in growing their business.

Welcome to season 5. Of Peter Lohmann's Podcast. This podcast is a show about all things residential property management, from property operations to sales and marketing to growing and managing your team. I'm your host, Peter Lohmann, co-founder of RL Property Management. For season 5, I have an exciting new guest each week. We go deep into conversation about problems facing professional property managers and the best ways to overcome them. Thanks for listening. Now let's go. Friends, welcome back to Peter Lohmann's podcast. I have here with me in the virtual studio today, Gail Phillips. Gail, welcome to the show.

Thank you, Peter.

It's so great to have you here. So for those of you who don't know, which I don't know if that's even anyone listening, but Gail Phillips is the outgoing NARPM CEO of some 20 years, and I'm just so excited to have her on the show today. And hear some of the behind the scenes and the backstory on NARPM from before the time I was involved and just from the other side of someone who's been continuously with that organization and involved in our industry for such a long time. The older I get, the more I'm a, a believer in sort of perspective and the value of being around a topic or an industry for a long time and the perspective that that brings. So I'm just, I'm able to take this opportunity in, in a way that I wouldn't have even just 5 years ago, just because I, I place a lot more seriousness on like a longevity with a specific thing in a way that I didn't when I was younger. And that's probably something everyone goes through. When you're young, you think you know everything. What could someone possibly learn over 20 years that I couldn't figure out in 2 years? Right. But now I realize how, you know, silly that is. So Gail, I, I'd love to start. Before we, you know, dive into your history with NARPM, tell us a little bit about what you were up to prior to getting involved with NARPM.

So I am part owner in the management company that runs NARPM. So it's really an interesting story. I was managing 5 smaller associations, government purchasing, actually an IRIM chapter, mortgage banker. So anyway, I had a real variety of associations along with handling the association side of our management company, which means I've worked with the other association executives.

And I want to pause for a moment, if you don't mind, because— Sure. What's funny is that the words that you're using have very similar meanings in our industry, but they mean something different. So management company in your world is a group that helps trade organizations like NARPM operate and function. Similar to how we help property owners, you help trade associations with everything. And again, association, which I'm immediately thinking like condo association, that just means like trade organization, trade group like NARPM and, and NAR. And there's a, there's a million of these. There's, I don't know how many, you probably know how many tens of thousands of trade organizations there are.

Exactly. For anything you can think of, there's an association.

Yeah.

So our history really is we managed a large realtor association up to about 3 years ago, 4 years ago, we managed that and then we separate our ways. And so it changed our dynamic along with where our company went. So NARPM became one of our largest clients, but let's go back to history for a minute. So I do have to sort of transition into NARPM here. So NARPM sent out an RFP looking for a management company to take care of everything for them. Including their events, which we happen to have an events division also. And around when was this? Oh, well, 20 years ago. So that was what, 20?

That was 5.

Yeah.

Okay. Yeah.

Perfect. And before your time, you probably don't know Mark Banner out of Boise, Idaho. So we were hired and I was to be the interim exec until we could find suitable candidate for them. So while I was—

You were gonna be the interim CEO?

Yeah, yeah, yeah. So while I was managing my 5 other clients, I was also bringing NARPM on board with our other staff. We have a whole management team that does that. So yeah, so their first convention, I have to roll right into NARPM, was very interesting to the point that I walked up to Mark and I said, are all your meetings this drama heavy? So anyway, what ended up happening is we found a lady who was from the Leukemia Lymphoma Society who had applied for the position. So Mark flew in from Boise, Idaho. Understand I'm still managing my 5 clients over here. And he interviewed her. And when the interview was over and she left, he looked at me and he said, Gail, she is a bright young lady. I said, yes, she is. He goes, but our members will chew her up and spit her out. She's too nice. I will never forget. That was so funny. And so we ended up hiring her and giving her my 5 clients that I had been working with. And then I took on Narbonne.

Okay.

So, and then prior to the management company, what I should have told you for the other 20 years, whatever I did, I was the exec for Realtor Association. So I already had a lot of real estate background and our management company did also. We formed the management company was forming while we merged two Realtor Associations together. So it worked out real well so we could keep both our staffs. So we merged them together and, um, OMG started. Yeah. So that's basically, I know I'm all over the place, but I love my story of Mark Banner. And you know, looking back, he was probably absolutely right.

He probably was. Property managers are a rowdy bunch and got strong opinions.

They have very strong personalities.

Not afraid to share them. Yep.

No, not at all. So yes, I always said how I managed 20 years was Mark Banner sitting on my shoulder saying, you can do this. You are the person because you're strong enough to, to give us a direction and tell us what we need, even though it did upset some people. Now, that was my job.

Yeah, that's great. So 20 years ago, was, was that like the first national conference then?

No, they had had some. This was in at the— not the Grand, the Little Grand, whatever, Grand America. And it was The volunteers were running the convention at that time. They were doing their own hotel contract. They were doing everything. So this was their first time of bringing in professional meeting planning.

Got it. Okay. And what were those— what were the national conferences? Because I remember there's no broker-owner back then. It was just the one national conference. What was that conference like back then? Like, how many people were there? How many vendors? What was the vibe?

Oh yeah, it was, it was, they were smaller. We maybe had 30 vendors and we maybe had 300 attendees.

Okay, sure.

They were very similar though. Back then it was probably more brokers and owners of companies. As you know, back then, even though we don't like to use that word, they were mom and pops. We didn't have the larger firms. We didn't have anything like what you look at today. So they still had the tremendous networking. That is one of NARPM's biggest strengths. And I'll never forget the year that we were looking at making changes and some of the leadership says, but we cannot lose that culture in NARPM. That is what makes NARPM special is the way that members talk to each other. They share, they do everything. So that was my big goal. For 20 years is remembering that culture because that is so very important. And I know I have some special friends in NARPM because of that.

Yeah, absolutely.

Yeah.

Yeah. Robert Gilstrap is who introduced me to NARPM. I connected with him through Process Street, actually. Process Street wanted me to talk to him because he was thinking about coming on and we were using Process Street back then. And I got on with him and first thing he says to me is, You remember NARPM? I said, no. He said, you need to join NARPM. You need to join NARPM, come out to this national convention next month, meet up with me. I'll show you around, introduce you to everything. Before the end of the day, I want you to buy your ticket. I was like, yes, sir. I was, you know, I didn't know anything.

You would be surprised how many people have stories just like that of where somebody has told them they have to do it and they respected them. They said, okay. And they're still members today. So yeah.

Yep.

Yep. And Robert's a good guy.

Yeah, that's great. So, you know, I want to spend a little time back here in the early 2000s. What was the PM world back then? Like, you know, how are these properties being managed and what was on the minds of property managers as like concerns and frustrations back then?

So the first thing I want to let you know is in 2020, they had no concerns legislatively. Forget even bringing up anything legislative. They maybe had a little governmental affairs committee, but things were nothing like they are nowadays because they didn't have those concerns. They were more concerned with transactional and software. Whoa. We had, you know, Promise was the big software vendor back then. And then—

There was no Appfolio, no Buildium.

RentClicks. Dave Borden showed up with RentClicks and actually RentClicks was our first partner. Dave Borden got that started.

Oh, okay.

And yes. And so to see how different, I mean, their attitudes there were just, it was all about, you know, getting the business done. They didn't, weren't so into the technology also. So watching the technology change the way they did business. And I will tell you, Peter, you're not going to believe this, but the biggest change was COVID for our members. It made them stop letting people come in and using the telephone. It made them learn how to use things electronically. And it amazes me at how it took some companies that long to actually embrace technology. But COVID made it that they had to. They didn't have a choice.

Yep. Yeah, definitely accelerated, especially like the self-showings. I mean, that exploded during COVID and, you know, e-signing. I remember prior to COVID, I think 75 to 85% of our lease signings were in our office. Yes. And they would come in and sit down and we would run through the lease with them. And then when someone would, back then when someone would ask to sign the lease electronically, I would be like, Why? Like, why do they want to do that? You know, they can't come in. Like, what's— you know, they're too lazy to come by the office or whatever. And then my property manager would be like, well, you know, they live in Utah and they're going to be moving here. I'm like, okay, I guess we can do an e-signature for them. But I was all grumpy about it because I felt like we didn't get a chance to go over the lease with them. And now, of course, we haven't done an in-person lease signing in 4 years.

So. So there's a story of one of the members back then who used to bring on the last day of rent would bring his kids in and they would collect the money as it was dropped through the mail slot because that's how the rent came in. And at midnight, they closed that mail slot to make sure they got them. And I said, you really did that to your kids? He said, yeah, I did. So, so yes, there were some great, the way that business was done was so different. Things had to change. I mean, you have to be Things are so— the way that the transaction runs now is so much smoother. Even though it's longer, it's still so much smoother than it was.

Yeah. So there was very little legislative concerns. Sounds like technology was a topic of discussion. And were property managers at that time talking a lot about, you know, this question of fees? Fee maxing versus trying to include it in the management fee?

No.

No.

Okay. No, I can, you know, when that started. No, it was not, you know, they were, so I'm going to tell you this story. I don't know if you know Duke Dodson. So Duke Dodson put an article in The Magazine years when he was brand new. And he said in there, he goes, my true feeling is if you can't perform and get your money off your management fee, then you shouldn't be nickel and diming basically your clients. At that time, we had a Google discussion group and that thing blew up.

Oh, I remember the Google listserv. That was a great source of information for a long time.

And that thing blew up. And the president at the time felt so bad for Duke, he called him. He said, I am so sorry. Duke said, it's okay. He said, I'm used to it. That's nothing.

That's great.

And that was really when we really probably started seeing it back in that timeframe. But it was more exactly what Duke said, and Duke was young. He was young for that time, and it was more of, you know, I don't believe in, quote, nickel and diming my clients, and I'm gonna charge a management fee that's fair.

Yeah. I remember early when I was first getting started, and just to give some context for listeners, I didn't get involved in professional property management until 2013. I'd been managing my own single-family rentals for about 5 years prior to that. But, and then I didn't discover NARPM until I think 2016. And early in those days, somewhere around there, I discovered Robert Locke and some of his materials. And I'll never forget, he's got this one slide, he goes, He goes, property management is a nickel and dime business. And he goes, he explains how you need to pick up the pennies and the nickels and dimes all along the way if you're going to make any real money. He talked about how you can't charge a big fee upfront, so you got to make all these little things. And then, you know, kind of the opposite of what Duke Dodson was saying.

And yeah, well, and then I don't— Mark Creditor, if you know him, he was a big one in Texas for talking about fees. Now they were more open and talking about fees. Of course, we didn't— hadn't gone through the antitrust investigation, which sort of is what calmed all that down. So back then it wasn't as big of a deal, but now it really— and there's so much more now. The fee maximization is what's come up. You know, they talked about, hey, yeah, you can charge a maintenance fee, you could charge this, whatever, but not to the extent of like it is now.

Yeah. And were there any other property management conferences, national conferences back then?

Well, IRAM had theirs. Of course we had IRAM, NAA, we had all the big guys. We didn't have the vendors having the conferences and our own members putting on the conferences like they do now. Yeah. But they're all different. You know, I look at every one of them. Some people worry they're competitors. I don't. You know, if you, if you can't provide the service and people don't want to be there, they're going to go to the one that satisfies them. You know, ours are much larger. You know, the ones NARPM put on are much larger and are really a time to meet people all over the place and they don't concentrate on a certain software. We don't care about who you pick as a software. We're going to make sure they're there to provide you.

Yeah. And having spoken to a lot of these folks who have run these conferences, most of which are no longer running, if you want to go run and start a property management conference, go with God. I mean, truly, please try it. It's not easy. It's not easy to make money. It's It's honestly, frankly, a nightmare. I've sworn off ever, ever trying to run a property management conference. I will leave it to others. I will show up, I will speak. It's great, it's fun. I love every moment of being at them. I have no desire to run one. It looks like a nightmare.

I don't understand how people can, you know, just think that it's so easy because it's not. I can tell you we've got dedicated staff. We do. And we have lots of years of experience of training and things. So it's, it's different. It's hard.

Very hard.

It's hard to keep the interest. You know, things change so rapidly. Now with NARPM, it's, you know, the members pick their topics. So we're involved in the backend facility, all of that. And, but when it comes to the programming, because it's your industry, the members are the ones that pick the topics and pick the sessions, even the general sessions. We just put the program together once they pick it.

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Just like anything, it's cyclical. I see that it's cyclical. It's at a different level, but it's very similar. They're very similar in what they're talking about. But again, like I said, the legislative has taken really over the industry.

Yeah. When I first got— of this, when I first got involved in the industry, the, the hot topic at that time was assistance animals. That was a huge thing. Like that first NARPM conference I went to, I think, um, there was 3 or 4 or 5 different sessions talking about assistance animals and how to handle it. And it was, everyone was just in an uproar on the, on the listserv about, you know, assistance animals. Now I feel like you never hear about it cuz we just sort of figured out the policies and moved on with life. But that was, uh, that was the thing back then.

So we were very lucky with the assistance animals. Brian Greene was with HUD, and I don't know if you went to that broker—

I think I did. Yeah.

Where that woman almost attacked him at the end. But he was very good. He found an ally, and we found an ally in HUD, and we started working together. And we did a lot of things. We sent him a lot of data. It was tremendous. That was probably one of the biggest things that impacted us. Until the EPA came along and lead-based paint. And yeah, we've been dealing with lead-based paint. We've been dealing with all that. So yes, we were very lucky with HUD and HUD helped a lot in getting and letting us give them input. When we told them one time the story of an assistance animal is a pig, they're like, that's not the purpose. We said, well, it is. One of our members can tell you that this woman has a bedroom for her pigs. So yes.

Yeah. Wow. So thinking back over 20 years, what were some steps that NARPM took in the first half of that time period that turned out to be great decisions and very sort of prescient?

Well, I can tell you when we first took them over, our very first thing was to, you're not going to believe this, to build up their reserves. When we took over, they had $250,000 in their reserves. That was it. So our job, we were told, was to build that back up, which of course I took seriously, and it's still building.

But you made great progress from what I understand. They're pretty healthy now.

Yes, yes, it is. But NARPM's in a position now where if something happened, they're, they're safe for a few years because there is money there. And, you know, they wanted the education. We happen to have a distance learning— I think you've spoken to them— education division that we could help NARPM, they, their online education back then was a couple of PowerPoints. And so we were able to help them build their education division and their education offerings. I mean, pretty much the webinars, everything we brought to them from ideas we either learn at conferences or we learned from other organizations also, which is the advantage to someone like us because we're we managed several. I think we have like 12 associations we're managing. So we brought a lot of new ideas to them, which was great, you know, the videoing their sessions to sharing. And then it was actually the instructors who made the decision to cut the classes down to 3 hours because they said people don't want to sit for 6 hours. And COVID took care of the, of the mandatory classroom classes and we cut them down, made them all virtual. So a lot of that is they love the classroom classes at the chapters, but then once COVID hit and they saw how easy it was to take a class virtually, that changed, that changed everything. Just like it changed your market, the way you do business, it changed the way we did it too.

Yeah. COVID's kind of a black hole. I can barely remember what happened there. For in terms, like, refresh my memory, like, did we not have the national conferences for a couple years in there?

So we did not have Broker-Owner. You may have heard this was supposed to be in Hawaii. It was our first Broker-Owner that we moved it out of Vegas and it was gonna go to Hawaii. The idea was the convention should be at the more of the conference-type hotels and Broker-Owners should be more of the elite hotels and nicer places. Because broker owners put a lot into their company and they work hard. So that was our year of transition to broker owner. So what happened is we ended up transitioning and then COVID hit. We were already having a hard time because of some negative publicity getting people to Hawaii.

Yeah.

So Hawaii wouldn't cancel us either with COVID They, our attorney was just getting ready to send them a letter. And that day they shut down Hawaii, which canceled our broker owner. In the fall, we were going to Connecticut and we told them we have to cancel because we can't do anyone. You know, we, we just can't do it. And they told us, they said, we will waive everything. We will waive minimums, we'll waive everything. If you can just bring even a small group here. Our staff needs it. And we said, our staff was like, I can get enough people on our staff to go. They're going, sure, we'll go. We want to get out of town. And then we said, okay, we put it out there, got a committee together. And 135 people went to the Mohegan Sun in Connecticut. And it was It was great.

This was fall 2020?

Yeah, it was a great little conference. 135 people. We did Zoom it. We did virtual also. Yeah. And it was fun because it was such a small group. It was, it was the, and Mohican Sun was great because, you know, it was all masks and everything. But like I said, they just wanted people because their staff had no one and they were, they needed to get their staff back. So they really appreciated us also.

And then by spring of '21, was everything kind of back to normal or?

We still had the masking and we had to keep people separate, you know, it was more spacing issues. So thank goodness we were in the bigger hotel so we could take care of the space spacing issues.

Yeah.

But hotels were running differently too. They had to back off some of their requirements at the same time, cuz they knew we all were having problems also getting people there cuz some people were still afraid to travel. Yeah, so, you know, I think we still did one more. We still did the sessions virtually and to try to accommodate everyone.

Yeah, very interesting. And then any decisions in those early years that in retrospect was not the right move that kind of threw things the wrong direction for a couple years?

The good thing with NARPM is they pivoted really if something wasn't going well back in the early days, they were very good at pivoting, saying, hey, it's okay, let's, let's go back to what we're doing. You know, we've always had chapter issues. Yeah, we have our great chapters, our struggling chapters, and we've always tried to fix those. That's probably was our biggest dilemma. And so that was in the early days and is still happening.

And why is that? Why do you think some chapters just easily thrive, no problems, membership's always growing, and then other chapters just really be struggling for whatever reason?

Probably their leadership, you know, using— we finally, it was, I'm going to share. Pete Newbigg and I were talking one day and I said, Pete, why aren't we giving our chapters virtual assistance? I said, you know, that would give them the support they need. Pete said, don't tell anybody because that's my business. I never thought about it. I said, it's okay, Pete. It was our secret until this.

Great.

So we realized that if we could give them some support, then those that are strong enough should flourish, right? Well, those that are strong have gotten stronger and those that are weak are still weak. I mean, they're just— and it's because they have no leadership. They don't have a succession planning. You look at the ones that are doing well, they have succession planning, they have people in line. They have, they have it set. Some of them have hired their own staff and they have somebody, because you all have a business to run. And that's the thing I always tell a president when they come in. Our job is to run the association. You have a business to run. The first time I heard a president say that being president hurt their business was, I was like, ow, that's not good because then people aren't going to want to be president. Because why do I want to hurt my— but after they got out and people knew them, they saw that the positive it had, that it helped them in growing their business.

You've hit on leadership here a couple times, you know, discussing chapter leadership. I'm curious, you know, having seen many leaders come and go over the years, both at the national level and at the chapter level, what do you see that's in common with the best leaders in chapters and in national NARP? And what are, what are the behaviors or attributes of some of the best leaders that they've had in common?

Well, that's hard because on the national level it's different than on the local. I shared with one president one time, I said, if you keep doing everything yourself, then no one's going to want to be president because they're going to look and say, why do I want to come into this position? I said, and their hardest thing is delegating. Is finding people and finding strength to be able to delegate to. And that's what we see on the chapter level. We really do see that. On the national level, it's letting us do our job so that we can keep the organization. As you know, I took a lot of heat for, for a while. And, you know, I took some blame for things that I had no control over. And that happens. If you don't let the management team do their job, then that's going to happen. Same thing. On the chapter level, if you don't find good people to help you, you cannot do it all yourself. And if you look at the strong chapters, again, they have strong teams that are running them.

Very interesting. So sounds a lot like your company. Yeah, exactly. I was going to say, it sounds very similar. I mean, you know, the, the, a leadership skill is delegation, and it's very counterintuitive for many business owners because they got where they are by you know, getting their hands dirty, right? And not being afraid of hard work and staying those late nights and coming in on the weekends. And they feel like that's tied up in this moral question of hard work. I'm deserving of this because I work hard. If I no longer work hard, do I still deserve to succeed, right? Which of course those things aren't actually related. So very interesting. Okay.

And it is a lot of the same concepts, and that's why that Type A personality, when you move into a leadership, you gotta, you gotta just take it to your company. That's a great place to go, but it's hard. It's hard sometimes. You know, the ones that I always work best with were the ones who said, hey, I'll take care of the property management questions and issues, you take care of the association ones. I said, that's perfect. I don't want to get into property management. I have no desire to manage properties. And I, I like what I do.

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Well, first, I want to tell you what I thought was interesting was IROM. IROM came to one of our conferences because they couldn't believe the percentage attendance we had, the registrations versus members, because they weren't getting it. And they saw— they said how well our members got along and all the networking and the time we give them to share. And they were amazed at that. And I think that is, you know, people talk about the conferences and I think they don't understand that the biggest strength NARPM has is that networking and that sharing. How many times I've even seen it in your newsletter, you know, that's the strength in NARPM is that people aren't afraid. You know, yeah, you're competitors, but, and you're careful about what you talk about, but you're not afraid. Now we've had people who've lost businesses, members have have come in and helped them rebuild. And you don't see that in a lot of organizations. There's a story of someone's parents who broke down in Texas, and one of our members came and got the parents, took them to their house while their car got fixed. And it's like, you don't hear stories like that in a lot of organizations. A lot of them are more cutthroat.

Yeah, that's really interesting. I mean, I haven't I don't really operate in circles outside of property management. So what you're describing is just the water I've always swam in. And yeah, it's hard for me to imagine going to an industry conference that's any different just because it's all I've ever known.

Even the realtors are very, are very different because they're very competitive. They're very, you know, they're, you'll see that a lot with theirs is because the competition is, is such a high thing with them. Yeah. I think that's because there's so many of them.

Yeah. And there's like so many in any given market. Yes. You know, they feel like a listing you get is one I didn't get. Whereas in our world, you always hear property managers say, they say this all the time, there's, there's plenty of business out there for us. If you don't, if I get, don't get this one, I'll get the next one. You can get this one. They don't, they don't seem preoccupied with any particular rental property or owner. Mm-mm. Yeah. Sometimes they give them owners. Yeah. Here, take this.

Oh, they don't fit.

Here, let me give you some referrals. Yeah. So speaking of competition, I'm curious, because this also kind of predated my time, this antitrust thing that we read the disclaimer in the magazine, and, and I think we hear it at the conferences. So what, what actually happened? Because I, you know, you hear people say things, they say this, they say that about it, and I, I'd love to hear just from your perspective what actually happened.

So we had— let me start. We, you know, our professional standards, we have a code of ethics. So we had a gentleman who, and this is what I believe, we had a gentleman who contacted us who was trying to file a complaint against a non-member of a firm. The firm was a member, the broker was a member, but the member, the, the property manager wasn't. And they couldn't understand why we could not hear a code of ethics complaint against this person because they weren't a member. So they started slamming us all over the place. They got to the California, you know, our email addresses are not made public. They finally got to the California Association, California NARPM chapter, found their email addresses and just literally put out horrible emails. About 3 weeks later, I'm sitting at my desk and the staff buzzed me and said, hey, Gail, there's an attorney from the antitrust division who's on the phone. I thought, okay, who's pulling my leg? I answered the phone. Guess what? It was an attorney from the Federal Trade Commission. Yes. And what had happened, wasn't it just so funny that they were perusing the internet and found our code of ethics? And we had within our code of ethics that you couldn't speak disparagingly against a competitor. They said that infringes on the person's ability to advertise. I'm like, really? And they said yes, because NAR had almost the same wording.

Yeah, NAR has some, some suspicious language if you ask me, like per the FTC, they have some suspicious language in their code of ethics.

So he said, I will be— you'll be receiving a letter, you'll be doing all this. So I hung up the phone. I was like, oh great. Yeah. Where do I begin? So I called— we happen— our company had a corporate attorney. Who NARPM used at times. So I called him. He was with a larger firm, put me in contact with two of their attorneys who had worked with the Federal Trade Commission before. And so, needless to say, $35,000 later in attorney fees, which wasn't much back then, but by the way, that, that compared to today, it was a lot of hours, but, and a consent decree signed. That put NARPM under a 20-year moratorium with this. We had to change the code of ethics to be something not so anti-advertising. And then we hired an attorney who, at their recommendation, out of Washington, D.C., who specializes in antitrust. Because what we also did is every quarter we had to give them a report of what we were doing. We had to do trainings. This thing we do at every conference is part of that, that we have to make sure members understand that you cannot speak, cannot do. So that's where all of that came from. And that's— it's protecting the association and the members. Yeah, because as you saw what happened with NAR and other organizations, it has gotten a lot tougher. It has gotten the antitrust, you know, like that one I sent you. You just, it's just amazing out there. Let me tell you, Peter, the lawsuits that are happening, Narbonne was pulled into 3. One was actually Real Pages. Our attorney got us, Real Pages handled it and got us out of it.

Oh, that's good to hear. I didn't know that we were pulled into that.

Yeah, 2 others, 2 others that involve customers. One in particular, he never paid his rent and he got kicked out and he didn't know why, but it was our fault because we endorsed them. It was one of our firms. And so we had to work at getting, you know, okay, we know we're not at fault, but we have to prove it. So we had to go and we had to hire an attorney to go get us out of that. So that's what's happening in several firms that I have spoken to at the past conferences. They're saying that's becoming a big line item in their budget is their, their law fee, their lawsuits and to keep attorneys. So the same thing has happened. We still have the same attorney with the changing of the staff and the CEO. I was like, please keep Jerry because he knows, you know, I knew I could pick up the phone at any time and call Jerry about with some, and he was right on top of it. So yeah, so it was not a fun time because I had, I handled it because I was, didn't want the members to have to get involved in it. We went through depositions, interviews and everything. I had to explain how our code was. And you know, it's funny. No one was ever found in violation of that code. Yeah, that article. So that was even— it didn't matter though. They didn't care.

Yeah, it's just that the language was there.

Yep. That's all they cared about is that it was there and we could at some time. So yes.

Does the FTC just have like general guidance for trade groups? Because trade groups are nominally competitors working together. So do they just have like a standing set of guidance like, hey, If you're running a trade association, here's some things you should avoid.

Well, yes, it's all— we're all trained in antitrust, and that's the big thing with trade associations is antitrust and to keep our members from doing these things because that's mainly where it came from. I do know there was an association who started their own advertising publication and the newspaper sued them for trying— that they were trying to put them out of business. So there's cases like that. That was an odd one, but then that became a case study. So we have to go back between our attorneys and watch case studies. And it was interesting because what we talked about in AR, I asked our attorney, our antitrust attorney, I said, why is it in AR? He said, because they've got attorneys on staff and they have big pockets. And they, I said, but one day things are going to change. And he said, yes. And it did. And then NAR finally got caught. You know, when I managed it, I was like, how can you do that? But okay, you told me I had to do it. And we still manage two realtor associations. So yes, we're still dealing with it. And having an MLS. So, you know, a lot of members say, hey, we need an MLS or a rental listing service. I don't know if years ago we did have one, Rental Improves. Rental Home Pros. But the problem was it was on the expensive side and members just didn't participate because of, I think it was more the cost. And so at some point we just had to say, you know, this is a sinking ship. We need to just cut and we gave it back to the vendor who designed it. Right now they're designing the KPI software so that you can see how you compare in different areas. But that had to run through our attorney. There are no names. They can't find your property management company, but they can look in your area and anyone who's participating. So we're hoping that's going to help members in running their business at the same time. So Rental Home Pros probably was a lesson learned.

Yeah. And unfortunately, since we ceded that ground, Zillow has taken it. And I've written about this in my newsletter recently that, you know, Zillow controls our customer eyeballs, customer meaning renters. And that is scary and dangerous in my opinion. I feel that we as property management professionals should own and operate the listing platform that drives the majority of eyeballs to our listings, just like realtors do, a la MLS. So it's scary because at any moment Zillow could say, here's the new price, or you have to use our application, or you're not allowed to charge an application fee, or you name it. They get to dictate the terms of how we interact with renters, which is a really important part of our business. And so I worry a lot about that and I sometimes think about Rental Home Pros and could we restart that effort? Could we buy Zumper? Could we just do something to bring this control back? To our industry. I think it should be operated by NARPM as a nonprofit type of arrangement. I don't care who runs it. I don't care who does it. I just wanna see it happen because this is like, to me, it's existential. It's like if Zillow controls, if Zillow is between us and our customers, what does that mean for us? Scary.

So we, there's our antitrust concern. We have to be careful because we don't want Zillow, we ran into this really when they started charging and people were talking about boycotting and all this. I said, guys, be careful.

You can't do a group boycott.

Yeah, you can do a group boycott. And you have to be very careful with that. Yeah. There are other services out there that I know that Homes.com got bought by a large— that I think you're going to see some changes coming. Yeah. Because I think that people are saying that One per— one company can't dominate the market. Yep. We used to have a good working relationship with Zillow, but then they decided to pull out and do their own thing. You know, I will see, I don't know how they can mandate that you have to use their things because then you just won't list. And some markets don't use Zillow. Some markets use their own MLS and some people use it, as you said, just for those properties that They won't rent.

Yeah. The, the situation though is it's, they've bought up so much of their competitors now that, you know, Rent Engine just had a report come out showing, you know, 70 or 80% of all signed leases originate on Zillow. And like in some markets here and there, there's like some other competitor that really does well against Zillow. But in 95% of markets, it's Zillow. The thing that concerns me is if I owned a property, and I wanted to— hey, forget Zillow, I'm not paying them. I'm just going to list on these other websites. Great. That's wonderful for me. If I'm representing a property owner in a fiduciary capacity, I can't get on my high horse about Zillow because now I'm interfering with my client's ability to rent out their property effectively. To just blanket say we're not using Zillow because I don't like their policies, I don't like their application, their rental application or whatever. Now suddenly my client who owns the property is sitting vacant for 3 weeks longer than they should because I'm making a principled stand. That's not appropriate. So, but that's what I'm scared of is we've now gotten to that point where you basically have a fiduciary duty to, to use Zillow. Like, that's insane. So I don't know what the right answer is. We're kind of getting derailed, but—

Well, I know, but it's the same thing in sales too. You know, they're, they're out there with the same thing. They've tried so many different, You know, they have, they have Realtor.com and I don't know, you know, you still end up with all these different platforms and I don't know what the answer is. I don't either. If they'll implode like they have in the past, you know.

So I believe every professional property manager should be an ARPA member, full stop. Every, everyone. And I think it should be the first thing you do when you get your real estate license and decide to manage property. But it seems like less than 10% of professional property managers, just depending on how you want to count, are NARPA members. So I'm curious, you know, maybe kind of like two questions. What is, what has been some of your most effective membership drives in the past? And then what is, why this disparity? It's not the cost. I mean, NARPM is not inexpensive on an annual basis to be a member. So what is preventing more property managers or— I don't know, I'm curious your thoughts on this, having seen, you know, from, from a high level the all of over many years.

Well, back a few years ago, we would go to different trade shows. We'd go to like Rent Managers, we go to vendors, trade shows. They would be very open. We could talk to people, learned a lot about the different types of rental properties that are out there, you know, the manufactured housing, things like that. And that was a great way that we at least got NARPM's name out there. But then when everything changed, we stopped doing that. But I will tell you that NARPM has just hired a marketing company, an outside marketing company that's going to help us in our mark— in the marketing that's going out to be able to bring more members in. Members, and here's the thing, we ask, how did you learn about NARPM? And probably 85% of them, it's word of mouth, just like you, from members.

Robert Gilstrap, yep.

Yep, 85%. And, or they come from a chapter event, or they hit NARPM. The majority of them are members referring us over and over. That's been the number one way. So we have started, you know, these marketing campaign packages with our chapters to try to get the information out. But chapters don't meet like they used to also. So finding the avenue to be able to pull members in to do things, that's why we do more free webinars and we do things to try to get people to know who we are. The big trick is the name, getting that name out there. Is very, very difficult. Now, you've heard NARPM 2.0. We'll see what's going to happen because what's happened over the years, as one of our friends has said, NARPM's become a very slow-moving train or a boat. I tell people it's become a very large ship in the sea. It takes a lot of time to get it to move, which was a change because before we used to move very quickly. If something wanted to be done, just did it. So hopefully NARPM 2.0 is going to put that back in where the staff will be actually running more of the day-to-day operations and be able to keep the ship moving in the direction it needs to move. Like I said, just over the last couple of years, you could just see it slowing down. And I mean, I, I took the heat. Okay. That's fine. You know, I can't do anything about it, but It's okay, things happen. And the change has been, you know, our strategic plan, it's a 2-year plan. This is the second year, finally got Communications Committee to hire the consultant, and they're working on it right now. So hopefully within the next month you'll be able to see it coming out.

Well, great. Yeah, yeah, I'd love to see those membership numbers, you know, start climbing.

And it's funny because the past probably 2 years, we've been pretty stagnant. So that is the trick, figuring out how to get people. And I think it's sort of, Peter, also with the market, the market's changed. People just don't have the free time they used to have. You know, that's why I'm so impressed with what you do, that you make sure you have that free time. And, and it is hard. It's harder for associations to find volunteers because of there. Yeah. Yeah.

It's a, it's a challenging problem. And I think the value proposition of NARPM has stayed relatively the same, which is high. It's still really high, but I think the way it's being communicated does it a disservice. Like you talked about early in this interview, the value of the members and the connections and And that's truly where it's at. That's irreplaceable. But I think if you were to ask a random professional property manager who wasn't an ARPA member, like, what would you get out of joining NARPM? They probably wouldn't even list that. They would probably say something about advocacy and like maybe some forms and some education. The problem is like a lot of that stuff is just so much easier. Well, not the advocacy part, but everything else is just so much easier now to get anywhere you look, anywhere you go, you're tripping over some course or something like that. But it's that those connections that you form with other property managers at the conferences and you now you're just texting them when you have a weird problem and like that's the, that's the heart of it. It's like, how can we communicate that to, to every professional property manager? You need to have 5 buddies on speed dial who are in your industry all over the country that you can call at 3 in the morning when you can't sleep because you have a weird client lawsuit. Like, how do you put a price on that, right? Exactly. But how do we communicate that?

Look at what you'd pay a counselor. Right. Yeah. Look at what you'd pay a counselor to give you that same service. But you're absolutely right. And that is one of the things hopefully that doesn't change as NARPM grows, because that is very important, particularly in this. You all are in a very stressful, very highly legal battles. You don't need— you need to have that friend that you can call. Look, that's how you started Crane. That's one of the strengths with Crane is that you bring them that.

You bring them something. I heard someone ask a guest this question. I thought it was great. So I thought I'd try it out on you. And so what, what do the haters get right? What do the haters get right about NARPM? And then I'll ask you what they get wrong. Oh, so that's hard.

You know, in my— well, actually, I'm retired now, so I guess it's not this time.

Yeah, but I'm sure you're highly, you know, you identify with, you know, that's long gone.

There are some who I've picked up the phone and called and I said, you know, I have to be careful. He is— they are president right now. So there are— it is, you know, the ones who have said the slow-moving boat, the things like that, who now— who then came back and said, I realized it wasn't Gail. And to see that that's right, that change had to happen because it couldn't continue that way. That's why I was real excited with NARPM 2.0, which actually that came from the large brokers who said, we want NARPM to be here in the future and we need to have changes. We need to have the association moving in the right direction. So that was was truly, that was correct. That was, that was very true. Now I get to talk about what was wrong.

What do the haters get wrong? What do the haters get wrong about NARPM? You know, you can clear the air here now.

Well, the election process. Let's talk about that. Okay. So we have done 3 studies on the election process. 3 studies meaning 3 independent groups brought them in. Spoken to consultants, spoken to 80% of the trade associations like us do our elections exactly the same. And NARPM 2.0 really changed the direction of how NARPM does their leadership development. Now they're actually doing it not based on who you know and who you don't know. It's based on industry, what's happening out in the industry. What impact can you have? What? What benefit can you bring? So it's no, they go through a rigorous interview. So the hard thing of having a slate is you as a member, or, or pick and choose who you want, you as a member aren't privy to those. And I know that there was one year where we had like 8 candidates, we had to pick 4. And if we had put it on a ballot for choice, and put some of those weaker candidates and listening to that interview, it wouldn't have been positive. You know, so I think though that a lot of the, as I was told, the good old boys picked their friends to be it. And it was Gail's friend. It wasn't Gail's friend. Gail's friend is anybody who goes on the board.

I'm packing it with Gail's friends.

Exactly. I was like, I really wish. But anyway, so it is the way that the majority, I know that the other association that this person was with doesn't do it that way. But when you have 3 different groups going out and looking and 3 groups saying, we understand why we don't do competitive because you don't know what we've gone through in the interviews. And I'll tell you what, this year with NARPM 2.0, they had a phenomenal group. They're writing their own papers. You know, I, of course, I assisted them with their policies and now they're putting together how do we pick next year, the next committee, to make sure they're as strong as this committee, because we have never had one that was as fantastic. I mean, they thought outside the box. They, they, and they even admitted when they did some things wrong in the interview, and we probably should change the way we did this. So they changed policy to make sure that it wasn't done in the future. That is the one thing I can tell you that in a competitive election, you'll lose that. You'll lose knowing who's, who's really working. So we have some people that probably, like, some of the leadership goes, I don't know them. I said, that's not a bad thing because they interviewed very well. They did a great job. And, and hopefully they bring new strength. Strategic planning is changing this year. They're not getting into operations. They're working on goals and strategies and they're not doing that of how are we going to do it. They're letting the staff work with committees to do it. So anyway, sorry, that was my long-winded— No, that's great. And the one who kept saying that, that I had all the presidents in my back pocket, yeah, that was wrong.

All right, the haters got it wrong. Yeah, I had great conversations recently with both Amy Hansen, current NARPM president, and DeeDee Lee, incoming NARPM president. They were both on the show recently. I'm not sure what order all these episodes are going to air in, but you'll hear from them soon if you haven't yet. If you want to hear more about some of this process, because they— I forget, I think it was Amy who went into detail on this, and it was really interesting, some of that backstory.

Yeah, it was. So I was fortunate enough to sit on that task force who came up with it, and we had a facilitator who came in who's out of up north, and it was just really good to hear the candid conversations that they had about the issues. And task force came up with these things. It wasn't the facilitator telling him he had to do this. The task force, you know, they gently guided them and they came up with these changes. So it was really great. That's great.

So U.S. presidents leave a little note for the next president on their way out, or they're supposed to. I think most of them do. I'm curious if you had a little president's note to the incoming NARPM CEO, what would be a sentence or two or some bullet points that you would share to help set them on the right path?

So the great thing is the new NARPM CEO and I have worked together for a year, for what, 4 years now. Oh, great. And one of the things he and I had already talked about was his desire a year ago if he wanted to be CEO. He and I had already talked about it. And, you know, I don't want this. I just, I think the biggest thing is for him to take time to himself and don't let them burn you out because that can happen very, very easily. And he and I had, we just went, actually we were together at a conference. It's one of our educational conferences. I took him with me and that was a lot of it. Don't, you don't have to answer the email as soon as you get it. If you're in, if you're doing something, just take a breath. It's okay.. And I think that's the thing that people have to remember. It's okay to take a breath and think about what you want to do. Yeah. I had to learn that the hard way. You know, I was, I was a person who wanted to answer it right away and give my first reaction and realize that, give me a minute, let me think about it. And what I used to always tell the board of directors is, I am a fixer. You give me a problem, I'll figure it out. I'll give you, give me some time. Let me think about it. And I would come up with solutions, but that's just from my so many years I've been doing this for. 40-some years. I started when I was 16. And then, so, so yeah, you learn a lot over that, that time. So now I'm excited. I have to tell you now my future is, and with our management company, I'm helping a brand new client get started and getting off on the right foot. And that's what I'm going to be doing. And that's really my true love is I like doing that. I like fixing and I like helping them. So, and I'm slowing down. So that's the big thing I like.

Yeah. I was gonna ask, so what's gonna be your level of involvement with, so OMG Organizational Management Group is, is the name of the, the group that you're a part owner of. Are you gonna be part-time, full-time with them? How, how are you thinking about that?

I'm gonna drop to part-time. I have a grandson as we talked earlier, spend some time with him. And you know, it's just to the point that at my at my place in life that I want to slow down and enjoy things, you know, when you hear, you know, it really impacts you. We've had some very special members to me who have gotten cancer and things have happened and they've shared, we have sat down and we've talked about it and we've shared life. And, you know, it's just to the point that I need to slow down. I'm still staying involved in the management company. I'm still, I'm still there. Tell them they're very lucky I'm an owner of the company because I'm still there for Troy. You know, I will be there and he knows it. And then I have a small client that I've been helping on the side. And then the new client, I'm just taking, I get to pick and choose. That's what the company's letting me do. They said, what do you want to do? So, which is, which is nice. That is great. And my hours are flexible, but you know, if we get a new client or we need something, I can step in and help. And I'm still working very closely with the other association execs we have. So yeah, it's, it'll be fun. It's a total change, but it's good. So far it's been okay. Yeah. My first week of being retired, I spent a week at the beach. That was wonderful.

That sounds amazing. Well, Gail, thank you so much for coming on the show and sharing some of your recollections and learnings over 20 years. Let me, you know, not be the first, but be one of those to thank you for that service and that tenure. And for those who want to keep up with you and what you're doing with Organizational Management Group, where would be the best place to connect with you?

Well, it's best probably just email me, gphillips@managegroup.com. Okay. I mean, I still have my NARPM email. I'm going to help keep it for a while, but that's the best way. And I appreciate, Peter, I appreciate everything. You know, I read your news, your newsletters constantly. And it's the first thing I told Troy. I said, if you don't get this newsletter, because I think you have some wise advice and you're very good at sharing that. And I know I appreciated that.

Well, I appreciate those kind words. Yes. Thank you so much, Gail.

This has been great. Thank you, Peter. Thank you for the time. I appreciate you. Take care.

Thanks. If you like the show and want to get connected to the community, You can follow me on Twitter @PSLohmann and subscribe to my email newsletter on my website, PeterLohmann.com. I try to share as much valuable property management content as I can on a regular basis. Thanks again for listening and have a great week.