Apartment Co.

Apartment Co is a residential real estate company that owns and operates 10 buildings throughout three different boroughs within New York. The buildings were built between 1975 and 1990 and have been under Apartment Co.’s management since that time. Apartment Co. prides itself on offering affordable, quality apartments for everyday New Yorkers. The only permanent staff in Apartment Co.’s buildings are the doormen. The company operates leasing from their central location in Manhattan, and has contracted with a maintenance service, which will be up for renegotiation soon. Over the last three years, Apartment Co has decided to invest $5M in its infrastructure with the hope of commanding higher apartment rent prices. The company has upgraded many of its apartment unit amenities, including kitchen appliances, bathroom fixtures, and flooring. These improvements have yielded high renter demand as well as increased rent prices. Recently, half of Apartment Co.’s buildings added washers and dryers in the basement; the remaining buildings have no laundry facilities. Even in light of these changes, however, management has not seen the increase in profitability it was hoping for. Apartment co has asked your team to assess ways to achieve higher long-term profitability.