Two years on since the launch of SDL Property Partners, we take a look at how the network has developed so far.

It’s been a little more than two years since SDL Property Partners was launched to support property managers, letting agents, surveyors and other property businesses looking to go it alone or expand into the world of block management.

During that time, our network has grown across the UK, stretching from the south coast right up to the northwest. As the first franchise block management business in the UK, we’ve learned a lot in our first two years. We’ve had plenty of success but like in any developing market, it hasn’t come without its challenges.

To take a look back at how our network’s developed so far and how the market has evolved, we sat down with our block management franchise experts Duncan Foster, business development manager and Chris Summers, head of franchising. Here’s what they told us in the first of our two-part interview.

What was the original vision for SDL Property Partners?

Duncan: SDL Property Partners was launched because we saw an opportunity in the block management market to support property managers who want to start their own business, who are passionate about service and want to deliver an exceptional experience for residents. We know that the relationship is generally between the property manager and the resident – rather than the management company. So, when a property manager moves on, clients tend to move with them.

The key issue for property managers, who set up their own businesses is they find that they’re swamped by paperwork, banking, client accounts, all the back office jobs that take up their time and stop them focusing on the relationship they’ve spent so much time nurturing. They don’t want to see that relationship decline.

Chris: So, we wanted to give property managers that chance to start their own business, without losing that personal service. By partnering with us, they could plug into our business support and we’d look after compliance and all those back office jobs for them, completely taking that hassle away so they can focus on maintaining relationships and growing their new business. They take 70 per cent of the fees and we’d receive 30 for managing the back office. The vision and model hasn’t wavered too far from that.

Has the network grown how you expected?

Duncan: Convincing property managers to go it alone proved more challenging than we first thought. It’s not a quick or easy decision to go it alone, no matter what industry you work in. For a property manager, you can sit in the pub on a Friday afternoon and think you know what, I can do it, but by Monday morning you want the safety and guaranteed income of your current role.

We’ve had a really good level of interest from property managers and many keep a close eye on our network. But we didn’t get as many early adopters as we thought we might. That perceived insecurity of starting your own business has stopped property managers from taking the leap, they’re very risk averse and during the last two years there’s been a lot of uncertainty in general. It meant we had to rethink whom to target.

Chris: Therefore, we shifted more towards property surveyors and letting agents who had or wanted to acquire blocks, in a bid to find new income streams. Since the tenant fees act came into force, agents have made significant losses, up to 50,000 in some cases, and for smaller agencies that is a big hit. So, they need to find income through other avenues.

Has shifting the focus on who you target impacted the model, have you had to change tact? 

Duncan: Our franchise network was the first in the UK so we set up a model we knew we would naturally develop over time as we learnt more about the best ways to work with partners. Originally, we went into partnerships with property managers and gave them exclusivity for their territory.

The idea was that if we found proactive partners who were keen to win business and grow, they’d have no competitors within the network on their patch. It worked well for these partners but for partners who didn’t grow their businesses it meant we were missing out on opportunities. In the more densely populated areas there can be up to 25,000 leasehold units, so if you have a less active property partner you’re really missing out.

Chris: So, we altered the model and the package. We decided to remove territories from our agreements and moved away from just property managers to lettings agents and surveyors. We also ramped up support.

We introduced training, set-up support, branding, marketing and minimum performance targets, alongside the back office support. It effectively means we are saying to businesses we will take all the responsibility and barriers away from you, you have the freedom to go out and grow it – do what you love doing.

Are you seeing opportunity nationwide or more significant in certain regions?

Duncan: All over. Of course your more densely populated areas like London provide lots of opportunity but we have partners from the south coast, to south Wales through the midlands and up as far as Blackburn. There are leasehold properties throughout the UK now and we want more property managers, letting agents and surveyors to join the network because being local to your block and having an understanding of the area is so important.

Chris: We knew that a block manager, who knows the area, lives there and is local to their residents, can offer a much more efficient service than a block management business that is based how ever many miles away.  They can offer a much more dynamic service and that is still one of the core reasons for the SDL PP franchise network.

Talk to the team

If you’re thinking about expanding or going into block management and would like to know more about how becoming an SDL Property Partner can help you, give the team a call on 0345 521 01527.