BY PREET ANAND
When Michael and Carrin Goldstein bought a controlling stake in Packard Realty Inc. in 1998, the couple managed two homeowners’ associations and one hotel.
Today, the company manages 14 hotels, with two more under construction, and represents 18 HOAs. They say their incentive-based business model has been fundamental to this growth.
Michael leads the hotel management operation as president of San Diego-based Packard Realty Inc. The operation completes everything involved in a project, from the acquisition or construction of the property to the sale.
“We buy the project, manage it and dispose it for the client,” said Michael.
PRI’s fee structure is variable and incentive-based. When PRI is involved in the acquisition and disposition of a property, it will lower its fees since they will be receiving a commission.
PRI reduces its fees compared to other management companies in return for a percentage of net income.
“If we do a really good job, we get a piece of the action,” Michael said.
Positive Energy
Together, the couple said they are a believer in what they call “positive energy.”
Michael said that many acquired properties were abused by the previous owner, which is why they have potential to generate higher returns once they’re under new management.
PRI tries to keep as much continuity with employees as possible to avoid disruptions.
At one property, the owner promoted the accounting manager to general manager to save money. When PRI took over the hotel, he put the general manager back into his former position as accounting manager , with the same salary. Generally, PRI replaces each general manager at each newly acquired hotel because the managers who come with the purchase don’t want to “buy in” to the new program.
Michael said his biggest challenge is finding employees who can keep up with him. Executive Assistant Alva Whetton, would agree, describing him as hardworking.
“I have never met someone so rapid-fire,” Whetton said. “He possesses a tireless drive to serve his clients.”
Michael said he is on the road four to five days a week, which works within the marriage because Carrin is equally busy with PRI. “If we weren’t doing business together, this relationship wouldn’t work” Michael said.
Michael and Carrin wake up at 4:30 in the morning to prepare for their workday. They’ll clear up e-mails and issues that stacked up while they slept and then go to the gym at 6 a.m.
From 7:30 a.m. till 5:30 p.m., they work straight through. The work then goes home with them in the form of a personal digital assistant, or PDA.
“They live and breathe their business,” said Whetton.
Michael sees his clients’ success as his own. One client, who already has one hotel managed by Michael, was looking to purchase a hotel, but Michael talked him out of it. “I told him we won’t be successful, so we won’t do it.”
Michael and Carrin believe they differ from most management companies because they want to foster long-term business relationships, rather than going for short returns.
“I always believe in the saying pigs get fat and hogs get slaughtered,” he said.
In Stride
The couple seems to take difficulty in stride. When notified of the California Air Resources Board’s new requirement for all off-road diesel equipment to be retrofitted by 2020, Michael simply said, “If it’s got to be done, then we’ll just go through with it. Can you put a price on the environment?”
Carrin is the executive vice president and heads HOA operations. In one example of executing on the business philosophy, her team responded just to close the garage door for an owner who had left it open. She doesn’t receive much gratitude from homeowners, but she enjoys going into a negative situation and turning it around.
“It’s just common sense; all you have to do is listen,” she said.
Barry Demchak, a former HOA board member of 15 years, said Carrin is very knowledgeable about her work.
“She understands how condo associations work as well as anyone else,” Demchak said. “Carrin’s definitely the very best we’ve had.”
Carrin’s goal is for her team to be responsive to home owner requests. The managers manage less property than at larger firms, so they are the direct point of contact for home owner inquiries. Finding managers who adapt to this structure is one of Carrin’s frustrations.
“My biggest challenge is finding people who buy into the program,” she said. “People who are looking for a career, not just a job and paycheck.”
The two said one key to their success is the fact that they are always available to clients. They said that it’s not uncommon for them both to be on the phone with a client, talking business, at 11 p.m. on a Saturday night.
Carrin said that someone is always accessible to attend to her home owners.
“We have an emergency response number because one manager is on call 24/7,” she said. “If that manager doesn’t get it (a call), then I receive it.”
Nothing Trivial
She explained that she understands why the most trivial issue can be important to a home owner.
“For them, it’s their home, the biggest investment in their lives,” she said. “Nothing is trivial.”
She added that her managers will return every call on the same day it was received. Even if the manager doesn’t have the answer yet, a call will be made to reassure the client that they are on task.
Michael said they are always available. “This allows us to quickly respond, react, and take charge of issues.”
While on vacation at the beach, Carrin relaxed from the hectic work of HOA management, but Michael was under an umbrella working away. With a shrug he said, “Work is fun for me.”
The firm’s HOA units are locally based.
However, not one of the hotels managed is within San Diego. Because of this, Michael has to be on the road to manage his properties. Michael said that their business is referral-based, and no one has asked him to do a project in San Diego.
He said they will probably have to rely on more than just word of mouth to continue their rapid growth. They will also have to accept their position as a large company and pursue clients.
PRI is moving into the spotlight and partnered with New York hotel mogul Sam Chang, who owns 20 hotels within Manhattan. A New York tourism expert guesses that Chang owns 60 percent of the 5,000 rooms being built within the city.
The couple must be cautious with their growth and spotlight to keep their image of accessible management. As Michael said, “I don’t want to be any bigger than we can effectively manage.”
The company has 16 employees in the San Diego corporate office, and 1,000 nationwide.
