Karen Hatcher, CEO, Sovereign Realty & Management
Karen Hatcher, CEO of Sovereign Realty & Management, spoke with Focus: about how to succeed in the robust Atlanta market: “You need to be intimately engaged and involved in the industry and in the community. The market is changing quickly, and you have to network and get involved to learn the market trends.”
With the evolving landscape of property management, how is Sovereign Realty + Management adapting to new challenges and opportunities in the metro Atlanta area?
Property management is a core focus at Sovereign. With the current landscape, many investors are interested in development projects. In the rental market, interest rates and taxes are preventing investors from getting the returns they want. Investors are less able to leverage their assets to access cash. We are on the single-family rental (SFR) side of property management, and we’ve had to incentivize rents with renewing specials and providing longer-term leases. With the built-to-rent and large multi-family inventory out there, tenants will leave for a newer construction property. We are getting creative about extending lease cycles and escalating leases. Many tenants want to stay where they are but want to lock in lease terms for extended periods. Retaining leases and tenants already in place is a priority. Atlanta has many neighborhood clusters that are all different. Some neighborhoods have maintained or increased in value because tenants have stayed longer. Emerging neighborhoods have been more challenging, but we are adjusting to the market.
Would you describe the real estate and property management market in Atlanta as a buyer’s or a seller’s market, and why?
Based on inventory, it’s a stabilizing market, days on market have been about 4.5 months at the time of this interview. We’re seeing price pressures on both for-sale and for-rent products. For real estate sales, properties need to be positioned well on price with sellers offering concessions. Listings need to be staged appropriately to showcase the property in the highest and best light. Sellers and agents are investing more upfront to capitalize on the initial time the property is on the market and plan for continued investment for longer days on market. Rental rates are declining in emerging areas and stable in others. Areas with high built-to-rent inventory and large multi-family inventory are experiencing increased pressure due to new construction units. Older SFR inventory is also experiencing pressure compared to newer constructed units.
Given your significant experience and success, what advice would you offer to someone entering the Atlanta metro area’s real estate market today?
Anybody new in the industry should join industry groups. They have to learn the business, people, and neighborhood trends. Real estate is vast, so you have to figure out where you want to get started and where you will focus. You have to be curious, get to know people, neighborhoods, and schools, be humble, and be interested. You need to add value, listen, show up to meetings, and join committees. You need to be engaged and involved in the industry and the community. The market is changing quickly, and you have to network and get involved to get the information and learn the market trends.
Sovereign Realty & Management prides itself on utilizing technology for better management and client interaction. Can you elaborate on the latest tech innovations you have implemented?
We are high-tech and high-touch. As a small business, we leverage technology for everything. I love AI, and we use it for analysis and increasing productivity. AI helps our entire team get things done more efficiently. To synthesize information and do things faster, you have to leverage AI. We are looking to increase our AI use in listings, graphics, analysis, trend analysis, training and virtual staging. I take AI classes, and I take what I learn and apply it in new ways to help our business.
How do you ensure consistent quality and service across different property types?
We focus on our process and leverage technology. With scattered site management, the only thing we can standardize is our processes. Processing everything the same way, every time. We use AI to help analyze information faster. I have an MBA in real estate and a CPM designation, and I used to do all of that manually. Now we can export data and get themes summarized quickly. I meet with my team weekly, and we leverage global support with virtual assistants to help our team members work more efficiently on the ground. Leveraging the global labor force helps us take in new inputs and ideas and offers more coverage around the clock. We have a multigenerational team that helps us assist landlords and tenants from affordable to luxury. Our use of technology at all levels of the organization ensures efficient communication between everyone.
