A Little Marketing

I’m always trying new things to increase rentals. So I recently read where some owners are putting out newsletters that focus on the unique aspects of their rentals. I put out the following – what do you think about it?

Regardless of where you stay – whether with me or elsewhere and if you’ve never been to St. John, dreaming about a trip or making your tenth visit. The Number 1 activity associated with the beaches and no, not drinking Pain Killers (although that comes a close 2nd) is SNORKELING!

TRUNK BAY

So here’s a little information that might aid you in your snorkeling adventures.

WHERE TO RENT EQUIPMENT? – (Alphabetical Order)

Cruz Bay Water Sports – Located at the Westin – so if your staying there probably a logical choice for equipment. Contract them at 340-776-6234 info@divestjohn.com

Low Key Water Sports – Just turn right at the ferry dock and you’ll run into them. They have rentals, snorkel, sailing and dive trips. Contact them at 340-693-8999 info@divelowkey.com

Lumber Yard – Can’t remember the name of the place, but there’s an addition location, just as you turn into the Lumber Yard (don’t worry, you’ll find it) on the right. Good equipment and nice people.

Paragon Dive Center – Don’t know much about them but unless you are staying at Caneel Bay Resort or other North Shore villas they are probably too far out for those staying in Cruz Bay Area. I suspect most of the snorkeling is done on-site and not one of the better locations. Contact them at 340-776-6111 ex 7290.

Cost for a week rental depending where you rent should be from $50.00 to $65.00/ week. All of the above also have various PADI Certification Classes and offer daily dive trips both in USVI and BVI’s

WHERE TO GO? – There are numerous choices depending on experience, endurance, ability.

Trunk Bay – This North Shore Beach is the Number 1 snorkel and beach destination on St. John. Which means it gets very crowded starting around 10:30 am when cruise passengers arrive from St. Thomas to spend a few hours on this famous beach. So get there early or after 2:30 pm to have a little privacy. Take the underwater trail out to the island. (I’ve always wondered how they got the fish to stay in the same place each day)? Good place for children snorkeling, has all amenities and lifeguard. But honestly, not much in terms of fish.

Maho Bay – A little further down past Trunk is Maho. Park in the new lot or if your lucky by the edge of the road. This is my favorite “beer drinking” beach. Wide, usually no people and likely to see some turtles out about fifty yards or so.

Leinster Bay – Located on the East End near Coral Bay. This is gonna be a hike! Almost a mile from the end of the paved road is the bay and also Waterlemon Key. But well worth it. You’ll likely have company with several wild donkeys that call this area home. Go to the right and swim along the rocks here you will likely see turtles and rays.

Francis Bay – My personal favorite. At end of paved road head down the bumpy dirt road for about a quarter of a mile. Try and get there early during season cause there’s only about eight parking places but if full just park by the side of the road. Usually calm with some overnight boats in harbor. I usually go to the right at end of beach by rocks – lots of turtles, rays, and many types of fish.

SUMMARY

Make sure wherever you stay the villa has coolers and chairs for the beach. Take plenty of bottled water and of course, other favorite drinks. See you on St. John and HAVE FUN!

Mike Mullen – Owner of Sopra Mare VRBO 251854, Bordo Mare VRBO 465589

Email: mtbgroup@hughes.net

Pat On The back To All That Works With Me!

Occasionally a “blind hog can find an acorn!” Don’t know who said that, but when I began spending my twenty years in Dallas and they invited me to play poker as I was the only “Yankee” they knew, that expression stuck!

So, we are now heading into June and I gotta say the Aspen mountains are beautiful. But, that’s not what this blog is about.

See, I set a goal last September/October to have more nights rented than any competitor. So thus far through August which encompasses about 440 nights thru Aug 7th we have rented a staggering 438 nights or occupancy of 99.5%! No one, absolutely No One has rented at that rate EVER! So ask, How Do You Do It?

First, I have an excellent team of individuals that work with me on St. John. They are constantly seeking ways to improve the rental process and the guest experience. We are now achieving more than 45% of guests returning and booking for their next Bordo Mare or Sopra Mare experience.

We provide top-notch service. Let me give you just one example – A washer went down in one of the villas. Now it’s not like you just drive to your nearest appliance dealer. No, this is a mess, the motor which is burned out has to come from San Juan and it has taken more than a week to get to St. John. But the Villa Manager – Colleen, took it upon herself to pick up every two days all personal laundry guests had, plus towels and deliver it back to them the same day. Now is that customer service or what!! I ask you?

Another guest, that I talked to last week at the same of the laundry problem villa (by the way the machine which is less than a year old will be fixed tomorrow) stated it was his fifth anniversary. Yea, we went all out and did something special for them.

You ask why guests return, look at the property reviews, talk to the caring staff and learn that we give greater than Four Seasons service to each and every guest. In fact, Four Seasons could learn a little something from us.

In conclusion, I’m proud of each and every one of the individuals that work with me on St. John at Bordo and Sopra Mare!

I’m out of country and contact for the next two weeks. But you can always EMail me. Thanks

Mulley

Pretty Serious

You know by now if you follow this blog just a little, that I’ll joke with you, give you some advice whether you take it or not, give a rant every once in a while, but things are getting more than a little serious right now on St. John.

We basically haven’t had a good rain in nearly three months. In fact, I just recently read a statement by an island resident that said it’s the worse drought he’s seen in nearly ten years.

The landscaping and plants are suffering but more important is wildlife: donkeys, deer, mongoose, yep iguanas and birds too.

For guests, the weather is great but for those of us, that call St. John our primary home or a second or even third home things “ain’t so good!” Every morning, I look at Ruth’s Web Cam of the dock hoping to see drops of moisture on the lens – nothing.

I have paid more for water bills in the first five months of this year than I paid in all of 2014. We save and contribute to all kinds of island events and crisis, so let’s give a little prayer for rain so the animals can drink.

Have a nice week

Let Me “Think” About This

This has nothing to do with the villa, so click and delete if you think it does. But if you want to read on then thank you.

So, I’ve gotten to a point in life where others seek my wisdom. I don’t know why, cause I’m not that smart, but still they do and it just might be seeking my money – cases in point:

Guy is underwater on a loan – defaulted and now wants to raise $400K. My advice which he didn’t want to hear. Get 60 to 120 days before absolute foreclosure – you’re not getting to save it. Get on with life now that your beginning to be successful a foreclosure or two at your age isn’t gonna mean anything.

Partner – We have a business that we’ve built over the last three years until about $250,000 gross. He says, we can’t find a buyer and sell, I say it worth about $2,500,000 to our competitors and YEP we can sell. Let’s see who’s right.

Next guy, wants to buy Hawaii property. I got no problem with that, but he’s gotta bring 1/2 the money to the table and I”m willing – let’s see what he brings over the next year or two? Cause he’s now just askin for money!

I’ll give you one more a “friend” on St. John has no vehicle. Now this isn’t a kid, but a 29-year-old man. I’ve got a Jeep on island, but every time I’ve lent it to him and another’s I wind up spending a $1,000 in repairs when I get to the island. So, decided last Fall, no vehicle use to anyone of the Jeep. He’s not happy – me I pretty happy it will cost me about $50.00 to get it running.

Told you not to read this Blog!!

Ok! This is a RANT!

I’m pretty much a live and let live guy. I went to a dinner the other night and my host went into this Left Wing what’s wrong in Baltimore. I mean, he wouldn’t let up! All police fault, they are attacking minorities. I asked a simple question – “You ever been to Baltimore?” Cause, see I have been and lived there for a year in Fell’s Point. I love the city, the people and the fact, they didn’t want to be a Northern City during the Civil War. As, I’m mostly from Texas this was important to me.

Anyway, after a glass of wine (which I might add I brought a couple of bottles), I just got up and left without a word. Unfortunately, I left my significant other, who wouldn’t say “Shit” if she had a mouth full and is really sweet, even though she comes from Seattle, which in my opinion, is the Leftest most city in the United States.

In Seattle, if the sign says, “Don’t Walk.” They DON’T. If the sign says “Don’t Walk on the Grass.” They don’t. But I on the other hand, cross between cars and definitely walk on the grass, just cause they have a sign that says “I can’t! I’ll definitely do it and challenge anyone who says I can’t. More on that at another juncture.

Anyway, on with my story. Got a email and phone call from someone in the Mid West that wants to build on St. John. He asked me a bunch questions and final says “You overpaid to build Bordo Mare at $700,000!”

Now that’s fighting words. Why the “hell” is this guy to tell me what is the right cost when I’ve been doing it for basically ten years!

So, I respond, (calmly, but at the same time the blood pressure was now going up), “Where is your architect from?”

Response “Florida.”

So, I say “Has he ever done anything in the Virgin Islands?”

His response, “No, But I’m a home builder in the Mid West and it never costs me more than $120.00/foot to build a house and it won’t cost me more than that on St. John!”

My response, “So, you got a Florida architect coupled with you that has never built on St. John. How you gonna get your plans approved as Department of Planning and Zoning (DPR) really aren’t quick to approve plans for someone not licensed in the islands. Have you considered that?”

His response, “No problem, and he states it won’t cost more than $300,000 maximum to build! One hell of a lot less than you.”

My response, “Let’s get something straight, I’m not charging you a dime, and only want you to succeed and I’m giving you free advice. So here’s the real life figures you, your architect, your builder haven’t shared with you!”

“A trackhoe will pull up to your site on day one. It will cost you on average $150,000 for excavation, cistern digging, pool and access. That’s if considering it’s only dirt, but on St. John, most sites have blue bitch rock – then that same trackhoe will now be charging you upwards of $300/hour with a hammer on the end of his arm. That’s basically $2,500/day. Your Florida architect tell you about that?”

“Next, yea, you can do a Force 10 House, made of steel. I’ve seen them fall over and I mean OVER in less than ten years from rust. Then you can get a prefab house from NC or SC I can’t remember which. But unless they use treated lumber, which they don’t, expect the termites to feast on it. Last, you can use foam filled block, and they may have changed this, but termites feast on it like an Oreo Cookie.”

So, here’s my advice, take your architect’s $300,000 number, double that, because he doesn’t have a “fu****clue about island construction, then add 100% for the builder who now has to make changes to the architect’s design cause he sure as hell doesn’t know what he’s doing and you’ll be about RIGHT!” FOR YOU – IT WILL COST $900,000!

SO THINK ABOUT WHAT’S REAL WHEN YOU’RE DREAMING ABOUT PARADISE AND DON’T CALL ME AGAIN FOR ADVICE!

Hey, have a great weekend!

Quit Whining!!!!

In prior posts I mentioned I received from 30 to around 40 real inquires for Bordo and Sopra Mare a month. A “Real Inquiry” is someone who requests information and wants certain dates. It’s uncommon for me to convert less than 25% of “tire kickers” to real confirmed reservations.

Well April has been a whole different, oh and I mean A WHOLE LOT DIFFERENT! This month up to today, I have receive a total of 12 inquires on both properties and I have honestly converted ZERO, ZIP, NADA! Now that doesn’t mean, I didn’t receive some reservations and they all came from returning VIP Guests which I absolutely love.

I was so “bummed” I contacted a couple of my friends with VRBO listings and see how they were doing. One is on St. John and the other in Hawaii. Net results, they both said “Hey, things are great – doin lots of rentals this month!” Certainly, not very comforting words in my bummed out state.

See, I’m pretty much an analytical guy. I got spreadsheets for everything and one of the basic sheets projects revenues and expenses a year in advance. Of course, this is adjusted each month as actual dollars are posted to the spreadsheets.

One of the guys mentioned, “How you doing with days rented versus last year?” Again, I have the information on my fingertips – told him for both villas January – June 2014 I was 84% occupied. For 2015 again for both villas I am 99.4% occupied. His response, “You Dumb SOB! It’s no wonder, you’re not getting inquires. Your so full everyone passes you by, wish it was that way with me!” Oh, and I added I was running more than 14% higher in collected rentals.

Guess, I’m gotta have to stop whining, I don’t have an open date at either villa until mid July. But that still doesn’t stop me from feeling like an unloved “Maytag Repair Man!”

Have a great weekend!

My Happy Villa People!

I don’t post many people pictures but the above is Tom and Verna. Their from Vail, Colorado area and you might say my neighbors as they are only two hours away from my Aspen home. Well they decided several months ago after they rented Sopra Mare for almost three weeks and forking over a deposit, they better investigate where their money went.

So one sunny winter day ole Howard gave me a call and said he was in my neighborhood and would I mind if he stopped by? Well after several glasses of cheap wine, cause that’s pretty much all I drink, even though I got a 1,000 bottle wine cellar they “blessed me.”

Now their enjoying Sopra Mare and you’ll note they’re raising glasses – and I mite add it was a toast to me, as I give them a little gift to Virgin Fire my favorite restaurant owned by a friend of mine – Michael. Looks like their enjoying their first St. John experience and especially Sopra Mare.

So What Do You Do? Let A Management Company Do It? Manage It Yourself?

Quandry Part III Management Companies Don’t Want You To Know

In the last post I gave you five general opinions regarding Property Management Companies. Again, these next five are in no particular order but worth your consideration when your making a management decision. So HERE GOES!

6. For whatever reason some companies insist on mid-week cleaning for a seven night stay. They say,”It’s to check on the number of guests actually staying.” I believe this is more in line with keeping housekeeping busy than adding to the guest experience. Do you change your sheets at home every three days? Well if you do, I believe you’re the exception. I’ve touched on this before but worth saying again. I have never had a guest complain that they want housekeeping at mid-week.

Let me give you the facts about why mid-week housekeeping is a really bad idea. Assuming you are rented 80% of the time or about forty weeks a year you are now washing sheets eighty times with mid-week cleaning! Cost of sheets have now increased from likely replacement twice a year to four times a year. If you’re like me, I buy good stuff and sheets, towels run me about $300 a set. While with mid-week cleaning your are now buying likely $1,200 a year for linens.

Additional use of electric, soaps, water and wear and tear on washer/dryer. With island cost of utilities nearly the highest in the world it is roughly costing you $20.00 for mid-week or about $800 unnecessarily.

But the biggest cost by far is housekeeping labor. This will add another $4,000 to your operating expense.

So in summary, Linens $1,200, washing $800 and labor $4,000. Total cost to you the homeowner $6,000 of lost profits by unnecessary wasted mid-week cleaning! Your choice?

7. Reserves – Management companies want you the owner to maintain substantial reserves in their account. Often these companies request upward of $50,000 held by them. Why? It’s your money and $5,000 is way more than needed in case of emergency. In fact, with electronics today, you can get money wired to the company in 24 hrs. Management companies state they need these excessive funds in case of severe weather like a hurricane. But, hey, if there’s a hurricane likely no supplies will be available for several weeks – cause they aren’t the only company trying to make emergency repairs.

Much better if you keep the extra $45,000 in your pocket, invest it, take a lifelong trip or as a last resort, rent Sopra or Bordo Mare from me! I can always use the money.

8. “Dings” – Every time you turn around another charge is showing up on your (untimely) monthly management statement. Good examples;

Charges for advertising – expect at least $1,200 a year billed quarterly. That doesn’t even include what a lot of companies are doing by signing you up to VRBO at around $400/year and charging it directly back to you. What advertising? Print advertising is a thing of the past. Basically, advertising charged to you by the company goes to advertise THE COMPANY and not your specific property. If your like me, I don’t even buy a newspaper anymore, it’s all free on the web. With VRBO. a well designed web site your “Good To Go” for advertising. Another $1,200 saved by you.

Other Charges – Mailing of monthly accounting statements, charged to you $100.00/year minimum. Actually mailing cost for 12 months around $30.00 bucks. In this day of email scanned reports, cost to you should be zero and no time delay.

Inspections – Management companies routinely “Inspect” your villa for damage usually quarterly at a cost of approximately $75.00 or $300.00 a year. This is like putting a “Fox in the Hen House!” See the management company says their self insured and charge from $75 to $100 to each guest to cover damages. But guarantee during their inspections they never find chipped plates, stains, paint or other damage. See if they did and sent you a report you’d demand damage payments from the company. Just try to get something paid for from these management received damage payments. You gotta fight like hell with them to get reimbursed for damages. I know, I’ve done it more than once when I found damage upon my arrival.

Actually the damage fees charged my the companies should go directly to you and not retained by them as your suffering the damage and cost of replacement.

I could go on and on about being “Nickeled and Dimed” by Property Management Companies, but your smart and can figure it out or contact me.

9. Rentals – I basically have two villas that compete with me and both are under control of Property Management Companies. Right now Feb – June I have a total of 300 nights available for both villas. Total rentals during this period is 292 or 97% confirmed. One competing villa for the same period is 69% occupied and losing about $23,000 from openings in their calendar when compared to me. The other is at 82% again losing about $13,000 as compared to my calendar. Why are the managed properties much lower occupied than me?

A number of reasons for poor occupancy performance by these two companies. First, they are essentially open from 9:00 am til 5:00 pm five days a week and reduced hours on Saturday. It takes them hours or days to respond to requests as they have a number of property inquires to handle. I, on the other hand respond within ONE HOUR in nearly 100% of my inquires regardless if it’s 3:00 o’clock in the afternoon or 3:00 o’clock in the morning! “They” give a canned response, mine are tailored for a personal response.

Management companies are not interested in avoiding “Orphan” nights in your schedule. They get paid the same if its seven nights starting a mid-week which leaves you plenty of “Orphan” open nights. I negotiate, go back to prior guests, and work the calendar as best I can to the maximum mutual benefit of the guest and myself. Remember what I said months back “A Dollar Lost Today, Is a Dollar Lost Forever.” That’s why I’m so highly occupied, every lost night is money lost to me personally as the owner.

10. Bonus Payments – It’s hard to give individual bonus payments to those working on your villa when using a management company as they are continually charging personnel and you really don’t know who to give the money to. So, you give it to the management company for distribution as they see fit. Do this and in some cases, the management people will just pocket the money and it won’t go to housekeeping or maintenance personal that deserve it.

Me? I don’t have this problem. See most of my people have been with me now years and I try my best to make sure they get absolutely the highest bonus on the island. They deserve it based on my guest satisfaction, just take a look at the more than sixty reviews on VRBO at 465589 and 251854.

Hope you had a good President’s Week. Next, So, what do you do? Manage it yourself or turn it over to the control of a Property Managementompany

Quantry? Part II Property Management Companies

Ok in the last post I looked at what can be expected when you manage a rental property yourself. Now let’s look at the other side!

Property Management Companies

This is not directed or intended toward the shortfalls of any particular management company. However, I have the most experience with St. John management companies. Most of the small companies have between 5 and 25 properties under their supervision. They charge anywhere between 10% to 40%. In no particular order here are some of the situations that arise and none to the best interests of the owner. Several I have touched on before but are worth again mentioning. So here goes with the first FIVE!

1. Fortune 500 companies close out their monthly statements at the end of each month and provide this information to the public within a week or so. They can do this as they simply carry over bills not received or paid to the following month billing cycle.

Not true with management companies – here is what has been stated to me on more than one occasion “We keep open the books until all bills have come in for the previous month.” Management company statements often are not provided to the owner for six and in some cases eight weeks after the actual closing of the month. Why do they do this? Pretty simple – they get to hold your money during that period as you do not have access to profits and as the owner cannot get paid. While meantime the companies get accrued interest on your month.

2. Credit Cards – Management companies “lov” to accept credit cards for guest payments. It doesn’t cost them a dime! They charge you all transaction fees. Now you just lost 4% of your Gross Revenue. Tell the companies you will no longer accept credit card charges or do as I do.

Over the last two years, I have had about a dozen credit card payments and use PayPal exclusively. I simply tell the potential guests that PayPal charges me a transaction fee for their payments so please add that fee to their payment. I’ve never had one guest who paid by credit card object. In most cases, they paid by check and avoided the charge.

3. Management Companies “lov” to use their credit cards for purchases applicable to your rental property. And Why Not?Whether routine paper and cleaning supplies or buying a large ticket items such as appliances.

Let’s assume you are one of 20 properties under management by a given company and on average each rental spends about $750/month. Total $15,000 spent a month. Credit card points to the management company minimum 15,000 and likely more. Over a year, that’s a total of 180,000 to 200,000 points, basically four FREE airline tickets the principles get to enjoy and OFF to Europe they go on your purchases! At the very least, you as owner, should insist on full receipt of all payments with all points on your purchases transferred to you each month or quarter.

4. One of the newest tricks I’ve seen is an added cost to the guests you as the owner never see – “Service Charge.” This fee is added to the guest bill and it is currently running about 5%. The guest pay’s this and for what? The management company is already getting a commission to rent your property why this charge? It is another way to “fleece” your guests. Don’t let them do it and make them remove it from any charge to guests!

5. Cancellation Fees are collected by the management company when the guest cannot arrive as scheduled and have made at least an initial deposit on the rental unit. Some companies deduct a minimum of 20% cancellation fee before they reimburse the guest often taking weeks to pay them. Guess what you get as an owner? Yep, you got that right ABSOLUTELY ZERO!! You, as the owner, not the management company should be receiving full payment of the cancellation fee. It’s you that suffers the loss of rent, not the management company.

Part III – “Come Soon.” Have a great Valentine’s Day!