CEO MONDAY MORNING MESSAGE

Tuesday, August 23, 2011

What I learned from a really old country

"If you don't like something change it; if you can't change it, change the

way you think about it." ~Mary Engelbreit

This past week I was on vacation with my family in the Italian mountains over Lake Como. We stayed in a house that was more than 500 years old. It was fascinating to stay in a village that was built well before the United States was even thought about and at a time when most people thought the world was flat. Interestingly most Americans I speak with consider our 100 year-old, buildings to be old.

Although Italy and the rest of Europe have their share of economic problems not unlike those being dealt with in the US, it was surprising to me to see how prosperous many of the small villages well outside the city centers are.

As much as the country is seeped in tradition and over a thousand years of history, the Italians have an incredible ability to maintain their heritage while adapting and advancing with time and technology. All of the walls in our village were the original walls, but the interiors were all modernized. The people in our village continue to gather in the central square (piazza) as they did hundreds of years ago, but now with live bands with electric instruments. They maintain their small streets that were built for horse and carriages, but now drive small cars that can fit through them and get great gas mileage.

We even experienced an upgrade to the mountains of Northern Italy. These mountains saw many wars, so they have been climbed and explored out of necessity for self-defense. We had the opportunity to climb these 10,000-foot elevation mountain that without experience would have been impossible to scale. To make them accessible to vacation climbers, the local climbing clubs modified cables originally installed during the war all the way up these mountains (via ferrata). This system now allows novice climbers like myself to reach difficult peaks and has substantially increased tourism and incomes in this region. Talk about thinking outside the box!

I had the opportunity to spend some really quality time with my family, and I hope that everyone at Signature Community is able to do the same at some point during the year. Watching my young daughters

and wife Yael climb a 10,000-foot mountain was one of the highlights of my year. The sense of accomplishment that could be sensed on their faces at the summit provides inspiration to help me push myself and the entire Signature Community to reach for our own higher summits. At Signature Community I strive everyday to make sure our team members and residents have the same opportunities that I experienced with my family on this vacation. Maybe the opportunities are not mountains to climb but everyone has their own personal summits to strive for.

I cannot close without mentioning one of my other accomplishments of this vacation. I spent most of the time in areas with little to no phone service, which was only compounded after I broke my phone while climbing one day., I was pretty much out of touch for the entire two weeks, but I wasn't worried. I knew that everything would move along fine, as it did.

Thanks for making it happen at Signature Community.

--
Nickolas Jekogian
CEO
Signature Community
917-763-3500
www.ASignatureCommunity.com
Blog -http://www.nwjceommm.blogspot.com/

"Si³" Signature: Ideas, Innovation, Implementation!
Send ideas to: ideas@asignaturecommunity.com

Thursday, July 21, 2011

Repelling Photo

Failing Forward

"Failure is a detour, not a dead-end street." Zig Ziglar

It's 1 am on Saturday morning, and my brother Mike and I are screaming down a dirt road on our mountain bikes. The only light comes from our helmet lamps, so we can see only a slim tunnel of road directly in front of us. This downhill ride is our reward for an hour of all climbing as we move much closer to checkpoint 6 in our 48-hour adventure race. As we get towards the bottom of the hill we see a T intersection that is not on our map. We stop and look around and note that this intersection looks familiar. "S**t!" is the only thing I could think of saying at that point. I just realized that the past two hours had been spent going in one big circle. Maybe we were in over our heads.

I started adventure racing earlier this year and find it a natural extension of the endurance running and biking I have enjoyed in the past. Adventure racing pushes me to my physical and mental breakpoints. This new 48-hour race endeavor consisted of mountain biking, trail running, kayaking, repelling and orienteering (finding hidden objects in the woods with just a map and compass). The race is accomplished as a team of two, and you must be within 50 feet of your team partner at all times.

"I can accept failure, everyone fails at something. But I can't accept not trying." Michael Jordan

This event was definitely a stretch goal for Mike and me. Our only other adventure race had been a 24-hour race earlier this Spring which took us 26 hours to complete and the use of GPS (which was illegal and disqualifying) to get ourselves out of the woods after we found all of the check points. So when we signed up for this one, we knew that we were taking on more than we could handle. And at 1 am Saturday morning after our unintended third loop in the town of Confluence we realized that we were probably not going to finish this one.

"That which does not kill us makes us stronger." Friedrich Nietzsche

We hung in the race for another 14 hours and made a strong showing during the 30 hours we endured. We hit 10 of the 20 required checkpoints, and I had the opportunity to try repelling for the first time – successfully thank goodness - by jumping off a 100-foot bridge.

"Failure happens all the time. It happens every day in practice. What makes you better is how you react to it." Mia Hamm

At the end of day we didn't finish the race, but we failed forward by learning from our mistakes and deficiencies. We practiced our navigational skills, learned to repel (and learned to wear gloves when repelling as the result of severely rope-burned hands), learned that it is much easier to swim across rivers than to walk across them, and many other things that I am still too tired to think of.

One of the most important things that we learned is about the teamwork required to endure such an event. My prior events relied on my ability to get to the finish line. This event relies much more on the team members' abilities to use their combined strengths to get to the finish.

"Success is going from failure to failure without a loss of enthusiasm." Winston Churchill

In order to perform at your highest level you need to push yourself out of your comfort zone and into a point of almost certain failure, or "failing forward". The success comes by learning from the failure and making yourself better from the experience. I am glad I failed this weekend and know that I am stronger now because of it. I will go back after a bit of rest and training to do another 48-hour race, and I will succeed!

"I have not failed. I've just found 10,000 ways that won't work." Thomas A. Edison

At Signature Community we fail all the time and are proud of those failures. Sometimes we try a new marketing idea that doesn't work or maybe we give a resident some extra time to pay the rent and they disappear in the night. These are all learning experiences that make us better in the future. We share these experiences in our daily huddles, and we are not afraid to share our experiences of failure so that we can allow everyone to learn from them. From a macro-perspective we are a risk-adverse company, but we do take opportunities to get out of our comfort zones and move towards greater success while failing forward along the way.

Thanks for continuing to support Signature Community through our success and our failures.

Tuesday, June 28, 2011

Who is our customer?

Who is our customer?

Businesses love to offer incentives to their customers. They give them
cards to swipe every time they buy something and hand out coupons at
every transaction. But does this really help consumers, or is this a way
for businesses to figure out who their customers are and motivate buyers to
change their buying decisions?

My take is that loyalty programs and other rewards program are really not
helping to get a good understanding of what the customers needs are.
They are just finding ways to move customers into behavior that works
best for the company.

At Signature Community in the past we have fallen into the trap of trying to
manipulate our customers' behavior. We tried to convince residents that
reading the paper or going to the gym was a benefit suited for them or that
our home buying program would allow them to save money on their next
home purchase. These manipulative programs were great selling points
but not used extensively and therefore are not necessarily good retention
mechanisms. In a survey of our new residents, 67% said they moved into
their new apartments because of gym access, yet our reports show that
less than 30% of our residents actually use the gyms. Aspirational? Yes.
Useful? Probably not.

Over the years we have realized that in order to be a good provider of
customer service you need to be an all-things provider. You don't need to
provide all things to everyone but you have to be able to provide anything
to anyone. We keep our offices open late and staffed to give our residents
the opportunity to walk in or call with a problem, suggestion or request, and
we also provide an online maintenance request system for residents who
don't want to have to talk to anyone.

In the world of customer service today, it's not about doing one thing really
well. It's about being able to perform services on multiple levels to reach
all customers and be able to readily respond to the evolving wants and
needs of our customers.

Thanks for making Signature Community the all around provider of
customer service in the apartment living business.
--
Nickolas Jekogian
CEO
Signature Community
917-763-3500
www.ASignatureCommunity.com
Blog -http://www.nwjceommm.blogspot.com/

"Si³" Signature: Ideas, Innovation, Implementation!
Send ideas to: ideas@asignaturecommunity.com

Wednesday, June 22, 2011

Reinventing the American Dream

As I read the latest real estate news this week, it becomes obvious that real estate values have dropped in many markets throughout the country to levels as low as 2000 prices. The equity people built in their homes is gone. And now economist are admitting that it may be another 10 to 15 years before the price someone paid in 2007 will be back. A generation of wealth lost!

It is amazing how much of our country's economy has been fueled essentially by a false belief in wealth created by a home. They really thought and spent as if the $30,000 projected annual increase in value of their home was real money as opposed to the monopoly money that it turned out to be. They also went out and spent their monopoly money at car dealers, restaurants, the stock market and retailers. The real estate bubble of the 00s was one of the biggest farces in US history.

Finally people are starting to realize that the "American Dream" does not need to center around a single asset that will likely cost more in upkeep than it will ever make as an investment. As we discuss with our residents, a home is a place where you can be part of the community. It doesn't matter if that is on an acre of ground hidden from neighbors or 8 feet away from the elevator. It is up to you to make the American Dream work, not the economists.

At Signature Community we always viewed the economists' and politicians' version of the American Dream as the American Nightmare, so we are reinventing that Dream so it can be attainable for anyone who puts commonsense thought and foresight into their economic decisions. Our version of the American Dream is the creation of community where like-minded people can share space, time, stories, and advice, and sometimes even lend a hand to help each other. Our American Dream is about being part of something much bigger than a McMansion on a lonely lot and is definitely more rewarding than the struggle to make the mortgage payment while still having to run to Home Depot every weekend because something is broken.

At Signature Community we welcome a connection with and between our residents to complete the new American Dream. Our American Dream focuses on people, not property. We look forward to years of the American Dream moving away from what politicians and economists unrealistically perceived values and toward a renter nation where residents feel part of the community and society and live the dream.

Thanks for everyone involved in helping the new American Dream to flourish at Signature Community.

Tuesday, May 31, 2011

A Team Approach to Adventure

It is 4am on Sunday morning and my Adventure Race team, made up of myself, my brother Michael and 2 former marines (Mike and Josh), has now been out in hills of West Virginia for 20 hours. We have already conquered Class V rapids, climbed up and down mountains, and found targets hidden behind waterfalls (with the help of a local who was in the right place at the right time). Now we are mountain biking on sparsely used trails trying to make it to our final destination within the 25-hour cut off. This "Adventure Race", where we self-navigate through the woods to find targets at 28 check points, is the latest challenge that I have committed myself to. And boy did I commit.

We found all of our early checkpoints with the navigational expertise of Mike. But as we wind our way through the hilly trails looking for the finish line we feel as if we may have taken a wrong turn about 3 hours ago, which is probably why the 100 other bikers that were riding with us are nowhere to be found. We are at the point where we need to completely change tactics, and backtracking for 3 hours is not an option.

This is when Josh, who was completely silent until now, kicks into high gear. He turns on his phone GPS to get our coordinates. (Technically this disqualifies us but at this point our only goal was to get home safely.) Now that Josh knows where we are he comes up with a plan to race through a small hunt club (another disqualifying move, but oh well) to get us near the river so we can follow the coast line to safety. Dogs are protecting the hunt club, but that's no problem for Josh as he creates a weapon out of

trecking poles to ward them off. We get through the hunt club without a hitch or dog bite, but within just 500 yards of the river we run into a very big problem. We are now 1500 feet above the river (ie we are top of a cliff). Josh to the rescue. He advises us to put our bikes on our shoulders and slide down the steep slope while grabbing a tree every 15-20 feet to slow

ourselves down. Less than an hour of controlled sliding later we are at the river and a short ride to the finish.

We didn't finish on time or follow all of the rules but we did reach all of the check-points and go the full distance. With a great amount of teamwork we completed our first 24 hr. adventure race.

Afterwards I reflect on our team and realize what it took to get us over the finish line. Mike the marine was the seasoned navigator who almost always kept us on the right path. My brother Michael was the consummate high-energy motivator that kept everyone invigorated and focused on getting there fast. I was the big picture guy that kept us focused on how much we needed to cover in what amount of time and whether we were progressing at the right pace to meet our goal. The local we met by the waterfall had the local knowledge to help us find our target. And then there was Josh. Josh said little during the first 24 hours of the race and was

always a little behind, but when we realized we were in trouble Josh had he solutions. He was the problem solver. He took control and got us to safety. It took the efforts and skills of the entire team to make this race happen.

Teamwork is key in any endeavor, and at Signature Community I see those results every day. Detail-oriented managers and accounting team members are making sure the numbers are right. Community managers are focused on making our customer service the best in the industry. Leasing agents are getting the Signature name known throughout the country. An aggressive acquisitions group is making growth happen. Corporate managers are keeping the team moving toward our focused

goals. The past few years in the real estate industry have been quite an adventure, and it has taken a strong multi-faceted team to survive. It takes a team approach to run a company and at Signature Community we have the best team to make it happen.

Thanks for being part of the team.

Wednesday, May 4, 2011

The LONG Real Estate Cycle

I am really amazed to observe that an article about real estate must either

be over the top optimistic (Fortune Magazine, April 1, 2011, cover story)

or tragically pessimistic (Wall Street Journal, April 18, 2011, "Housing

Slump Continues") In reality, I don't think we need to be looking for a

quick recovery or be concerned that this downturn will last forever. The

long cycles of real estate and other illiquid investments just require investors to wait it out and remain solvent in the meantime.

Unfortunately this doesn't sell papers. Readers crave shock value. (I

guess that is why Rupert Murdoch has billions more than me.) Real estate itself is

considered to have one of the longest cycles due to the inherently slow

process of dealing with troubled assets.

The beauty of real estate is that it is actually backed by hard assets;

however we must realize and be content that it can take years and in some

cases decades to reposition. Unlike stocks or bonds that have a very liquid

market available for trading, the real estate market is much smaller and

the process is much slower. Additionally, the laws that make real estate

such a valuable investment (ownership system dating hundreds of years

old) are also what help to draw out activity. The average foreclosure in

America takes more than 20 months from the time a borrower stops paying

their mortgage until the time the bank can foreclose. Add in time to sell

after foreclosure and you will probably wait almost 2.5 years for an asset

to become performing again. Compared to the 2.5-day process for stock

margin calls, that makes real estate 365 times slower to deal with than

stocks.

What this means is that instead of reporting good news followed by bad

news and then good news again, the real estate market is a slow news

business that takes years - not days, weeks, or even months - to adjust.

Until the defaults that started happening in late 2008 and early 2009 followed by the

holdouts that gave up in 2010 are filtered through the system we are not

going to start the upward phase of our growth cycle.

At Signature Community we have been dealing with some difficult

situations with our assets. Fortunately, we dealt with them very early on in

the cycle and have made it through the process with most of our assets.

Additionally, we have been active in buying assets and mortgages for the

past few years and realize the opportunities have still not materialized

mainly because of the reality that we are still either early in the recover cycle or still in the downward swing. Many

have jumped back into real estate in reaction to media reports that the

market is back, but we have been patient because we are concerned with what remains to

be dealt with before the market can recover.

We feel that our patience will be rewarded in the future and will allow us to make deals for the entire market upswing which, in my estimate, will

probably be measured in years or decades - not months.

Thanks for being patient with us at Signature Community. We expect that

you will be rewarded appropriately in due time.