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» VISIT US ONLINE @ DSNEWS.COM INSIDER'S PERSPECTIVE I n the aftermath of the downturn, property preservation has become more than just routine maintenance and clean-outs. It's morphed into a much more sophisticated role and garnered a central purpose that's become key to our recovery. Property preservation today equates to maintaining values in our local neighborhoods.  The property preservation sector changed dramatically over the past four to five years. Key players were able to respond to fluctuations in the marketplace and stepped up to claim a much more visible and influential position in the default servicing world.  Reacting to the sheer volume of distressed properties lining the streets of America, leading property preservation companies adapted their business models to not just support but lead the charge in stabilizing local communities. They've cemented their place in the industry as innovators, as strongholds, and as leaders—and they did it with more than sheer elbow grease; they developed their own new technologies and pioneered new strategies that have undeniably changed the business of property preservation.  Danielle Whitton, VP of hazard claims services and property preservation for Miken Construction Inc., summed it up saying, "Due to the increase in foreclosures, the property preservation industry has a heightened awareness in the public eye. We have put connections in place to build better relationships … to reduce blight in the neighborhoods. On top of that, we have learned … to handle the increase of volume at a faster pace." Shelly West-Chenoweth, president and owner of Atlas Field Services, which performs property preservation work for high-profile clients in the Nevada and Northern California regions, says with today's market conditions "everything is getting fine-tuned." She notes that the guidelines coming down from the various investors, lenders, and government agencies require a lot more involvement from their property preservation providers. Companies like Atlas had to "streamline the process and tighten up the ship" because "there's definitely been an increase in the standards," according to West-Chenoweth. On top of expectations for high-quality work, "You can't get the work done too soon," Julie Payne, operations manager for Qualified LLC, noted.  Payne says her organization at least tripled its staff over the past three years. Qualified also had to expand its network of subcontractors. "We have more crews now, not just because of volume but because it's not cost-effective to have them running on top of each other given the cost of gas and other operational expenses," Payne explained.  Even with the increase in volume and the added operational expenses that come with the job, Lee Mertins, director of operations for Asset Management Specialists (AMS), says property preservation professionals had to rethink their entire strategies for dealing with distressed and damaged properties.  "We can no longer say this is just an REO. You have to treat every house like it's the neighboring house," Mertins stressed. "We're seeing more and more clients and brokers opting to do landscaping packages to make the home look like the other homes on the block. We're being asked to do more pressure washing, spring cleanup packages on homes, renovation work, install new appliances, etc."  Mertins says this type of preservation and maintenance work has become essential for clients in order to make the REO presentable and able to compete with non-distressed homes on the market.  Payne agrees. "We try to make it look as much like the neighbors houses as we can," she said. "We're more aware of what each individual community requires. We used to never see vacant homes in upscale properties. Now we do. We have to be aware of requirements per the neighborhood, per the homeowners association (HOA). If the HOA isn't happy, no one's happy."   Payne continued, "It's tough sometimes. You want to keep the neighbors happy, but on the other hand, you have to take the customer into consideration. A lot of times, we're the middle man." Amie Sparks, SVP of operations for A2Z Field Services, noted, "With the expansive geographic reach of REO properties and the increased volume, the risks involved for banks and servicers have also increased. With that, they have to be more creative, and they turn to us to manage more of the process for them." Sparks went on to explain, "Five years ago, a property preservation company might have had a basic offering of 20 services to include lawn mowing, pool cleaning, snow removal, things like that. Now, it's not uncommon for a property preservation company to offer upwards of 100 different services." Greg Tolander, COO of Field Asset Services, says he's seeing "more and more activity in the repair and remodel side of [the] business. Getting a house ready for sale has taken on new meaning." Whatever the client's need, whether it's utilities payments or code compliance, "we take care of it and handle it just like we would our own home," Tolander said. Brett Ory, president of Cyprexx Services, sees an even wider range of services coming in the future. His company is already fielding a bigger demand for property registrations, and now there's also a big push for tenant-occupied services. "There's a lot of discussion around rent-andhold strategies," Ory explained, "which will require not just short-term cleanup and habitability inspections but longer-term maintenance and repair. It requires having infrastructure in place to deal with ongoing tenants on a longer-term basis." Caroline Reaves, CEO of Mortgage Contracting Services (MCS), left the servicing side of the business to start MCS almost exactly five years ago. She says she remembers walking into the new Tampa office back then to a room filled with fax machines and printers. "From a technology perspective, it's changed pretty drastically" since then, Reaves said, with Web-based technology running the full gamut of operations, all-digital photo technology, and iPads now commonplace in the field. "The biggest lift has come from technology," Reaves said, "and with the volumes being at alltime highs for inspections and preservation work, it was something that had to occur." MCS' IT group is probably three times the size it was five years ago, Reaves explained, and that's primarily because property preservation companies are continuing to upgrade their technology to keep up with market demand and clients' needs. 59

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