Client Snapshot
Industry:
Property Development, Investment & Management (Residential + Commercial)
Location:
USA (East Coast and West Coast; 5 cities)
Portfolio:
165 developed properties (single-family, multifamily, condominiums)
Service Scope:
Portfolio-wide budgeting setup, occupancy/leasing targets, variance reporting, expense control enablement
Key Highlights
Delivery Timeline:
Budgeting program completed within 90 days
Collections:
Collection factor improved 5–10% across properties
Expense Control
Utilities and repairs reduced 5–15% through visibility and accountability
Capital Planning:
Planned allocation of capital improvement funds (carpeting, appliances, etc.)
Client Background
The client is an experienced real estate development, investment, and management firm with a multi-property footprint across U.S. East and West Coast markets. Despite scale, the organization lacked a formal budgeting process and faced gaps between collections and expenses, resulting in weak net cash flows across many properties.
OHI supported the client in implementing a budget-based planning model, aligning occupancy and leasing targets, and introducing variance reporting to strengthen operating discipline and improve property-level performance visibility.
Business Challenge
No budgeting framework, inconsistent accounting practices, and distributed data limited expense control and weakened cash flow performance.
Disparate Data Across Systems and COAs
Financial data lived across QuickBooks, Promas, AppFolio, and Excel with inconsistent formats and charts of accounts, requiring mapping and normalization.
Uneven Data Availability and Accounting Practices
Some books were cash basis and others accrual; delays in postings and inconsistent practices reduced reliability of budgeting inputs.
Resistance to Change at the Property Level
Some managers resisted budgeting as a “control” mechanism and were slow to provide complete data or adopt tools.
Compressed Timeline and Target Setting Requirements
The budgeting exercise had to be completed in three months and also required occupancy and leasing targets by property.
Without standardized inputs and manager buy-in, a portfolio budgeting rollout would not be actionable. The client needed a practical methodology, clear reporting formats, and an implementation approach that built accountability while meeting a fixed deadline.
OHI's Approach & Solution
Budget Methodology Selection
- Selected a historical-data budgeting approach to enable faster rollout and match predictability in income and expenses.
- Normalized historical values for seasonality and utilization.
- Built rental income projections using collection factor and occupancy estimates against a base gross potential rent.
- Modeled contractual and financing-driven costs (contracts, mortgage schedules/interest assumptions, taxes, insurance estimates).
Budget Implementation and Manager Enablement
- Secured cooperation by positioning budgeting as a management tool with shared benefit for property teams.
- Conducted online training for managers on methodology, formats, and Q&A.
- Set targets with manager input and established accountability for variances.
- Piloted on 10 properties first to troubleshoot, refine figures, and fine-tune the rollout.
Timely Delivery and Rollout Control
- Completed the budgeting program within 90 days, integrating senior management support, manager inputs, and anticipated expenses.
- Implemented ahead of the financial year to ensure monthly expense timing matched budget expectations.
Results & Impact
| KPI | Before OHI | After OHI | Improvement |
|---|---|---|---|
| Budgeting Process | No operating or annual budgeting | Portfolio budgets implemented | Budget-based planning enabled |
| Variance Visibility | Limited operating control and insight | Timely variance reporting with explanations | Better performance understanding |
| Collection Factor | Collections gap impacting cash flows | Improved collection performance | 5–10% improvement |
| Operating Expenses | Limited control over utilities/repairs | Tighter expense control and accountability | 5–15% reduction |
| Capital Improvement Planning | Ad-hoc allocation of capital funds | Planned allocation across properties | More effective utilization |
OHI implemented a structured budgeting and variance-reporting model across a multi-system, multi-property portfolio. The engagement improved collections performance reduced controllable operating expenses through visibility and accountability and enabled better planning and utilization of capital improvement funds.
“The budgeting program brought structure to our operating discipline. Variance visibility improved, and property teams became more accountable for controllable expenses and collection performance.”
Portfolio Leadership
Real Estate Investment & Management Firm
Build portfolio-wide budgeting and expense control that actually sticks
Standardize data across systems, set property targets, and implement variance reporting that improves collections and tightens operating expense control.
