Peter Lohmann's Newsletter - Issue #168

Theory of Constraints applied to knowledge work. Deputy shot while serving eviction notice.

Author

Peter Lohmann
December 05, 2025

A no-fluff weekly publication for the property management industry.

Our Closing Rate Dropped for an Unexpected Reason

I recently completed performance reviews with my direct reports, including our Business Development Manager (BDM). She’s responsible for taking all the inbound calls and emails from potential clients (rental owners), confirming our company is a good-fit solution for them, and then getting them to sign up if so.

In reviewing her performance, I couldn’t help but notice that her closing rate (% of good-fit client leads that she signed up) had been slowly dropping since mid-summer, from ~40% down to 21%. This stood out to me because she’s a great performer, very quick to get back to leads, and spot-checking the call recordings revealed nothing out of the ordinary. What gives? I asked her about it.

It didn’t take long for us to uncover the issue: the lead time for our Pre-inspections (which we require for vacant units) had ballooned to multiple weeks! In other words, after she got an owner on the phone and they were ready to sign, she would attempt to schedule a pre-inspection only to find out that the earliest our team could get out to the property was 10+ days from now. It doesn’t take a leap of imagination to figure out what happened next. Owners are almost never going to tolerate that kind of delay, and they just moved on to the next property manager who was ready to start immediately.

I quickly brought this to the attention of the leadership team and set an aggressive goal for getting this lead time under control (ideally, we should be out to the property on the very next business day). We’re currently working on reorganizing our capacity to accommodate this.

This was interesting to me, and I bring it up as a “learning moment” for three reasons:

  1. The importance of reporting key metrics (e.g. Closing Rate). If we had not been carefully tracking & reporting this metric, it would have been impossible to notice the drop in closing rate. If I were a better manager, I would have noticed this much sooner, but better late than never.

  2. As the business leader/owner, you need to understand that some things require the violent application of “soft power” to fully solve. It’s unpredictable, but every once in a while, you’ll identify a major issue that is bottlenecking the entire company, and for whatever reason, nobody else seems to be taking it seriously or rapidly moving to solve it. When you find something like this, which typically happens once or twice a year, you need to move mountains to clear the logjam. In those moments, do not worry about the chain of command, nor your EOS issues or rocks, nor that marketing project you’re excited about. Drop everything and force a solve on the bottleneck at any cost. As the owner/leader, only you have the company-wide context necessary to understand when this is required.

  3. It can be very difficult to identify your business’s constraint. At any given time, there exists one (and only one) constraint that is keeping you from “doing more” (growing, being more profitable, whatever your goal is). It’s your current bottleneck. Picture the slowest machine on a factory floor. This is really tricky in knowledge work, because we can’t just look at the literal factory and spot it. I’m diving into this subject with Jon Matzner, and we just recorded a live episode of our podcast (Lazy Leverage) all about this. Start by reading Eli Goldratt’s The Goal, the classic text on this subject.

THIS ISSUE IS PRESENTED BY UTILITY PROFIT

I tweeted this almost two years ago, and since it’s even more true today, I want to look at one of these areas more closely: Move-ins.

No tool automates every part of a move-in. The ones that work go deep on a specific step and integrate with the rest.

That’s Utility Profit.

Utility Profit focuses on one of the most manual parts of move-ins, utility setup confirmation, and fully automates it.

It plugs directly into all the major PM systems, so you don’t have to change anything about the rest of your workflow.

And it's free, because they’re paid by the utility and internet providers. They even share that revenue with you whenever tenants set up internet and certain utilities.

This time of year is the best window to evaluate tools like this. Once the spring surge hits, you won't have the bandwidth to try anything new.

Book a demo and remove utility setup from your move-in workflow for good.

Do you have to let ICE into your office?

Short answer: NO. But does your team know that?

On this week’s podcast, I sat down with attorney Monica Gilroy to talk through the compliance landmines that catch PMs off guard, starting with what to do if ICE shows up asking for tenant info (spoiler: they’re basically toothless).

We also got into ESA documentation (what’s legit vs. what’s a Word doc from the internet), vague screening criteria, and the exact phrase you should never include in your application process.

Monica’s take? Your screening should be blind, boring, and 100% consistent (in the best way possible). If your team is “going with their gut,” you’re exposed.

We also covered when you can say no to Section 8, the lawsuit risks of sloppy documentation, and the lead paint rule no one’s following (but really should be).

Every so often, I record a podcast episode that makes me want to go audit every lease, process, and template in our company. This was one of those.

(You can also listen on Apple Podcasts or Spotify)

New Property Management Companies For Sale This Week

  • A solid PM company for sale in Western Wisconsin (asking $2.5M, ~1,000 doors - mixed residential portfolio)

  • Here’s an established STR-focused management company in Austin, TX (asking $2M)

  • Here’s a PM company plus Construction for sale in Portland, OR (asking $750k)

  • A PM company is up for sale in Washington (asking $2.5M, 659 units across a total of 72 buildings)

  • Here’s a PM company for sale in Palm Beach County, FL (asking $1.2M, 278 doors)

This section is sponsored by RentEngine. Since switching earlier this year, our average days on market dropped by 9 days (and we’re saving money). RentEngine handles all lead follow-up (even after hours), coordinates self-showings and agent showings, and syncs with our PMS. My team loves it. Book a demo here.

Industry News & Events

  • RentScale is hosting a sales & marketing webinar next Thursday (these are always excellent). Crane members Mark Ainley, Casey Howe, and Robert Dell’Osso are panelists. These guys know their stuff.

  • Also on Thursday, Property Meld CEO Ray Hespen and industry thought leader Dom Beveridge are hosting a webinar to “break down the data, spotlight emerging trends, and share what property management leaders should prepare for in 2026.”

  • I missed this, but back in September, HUD pulled down its guidance on ESAs (emotional support animals). It seems they are less interested in going after these cases. More info here.

  • Realtor.com is moving to a paid model for tenant leads (60¢ per lead). More info from Tenant Turner. This is bad! More renter eyeballs will migrate to Zillow, strengthening its already dominant position (literally nobody is going to pay for Realtor.com leads, so the platform will quickly fade from memory for tenants and landlords/property managers alike).

  • “A Florida sheriff announced that a deputy was killed and two others were hurt in a shooting while serving an eviction notice in Vero Beach.” Source. Stay safe out there, folks.

  • Great write-up about how PM industry conferences are broken (and some novel solutions) by the Apartment Jedi Andrew Bowen.

Closing Thought

A few quick things before you go…

PeterBot

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Over 100 property managers have used this in the last couple months(!) Many are returning weekly to ask me their hardest property management questions.

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The content of this newsletter is for informational purposes only and does not constitute professional advice. I may have consulting agreements with, or financial interests in, companies mentioned in this newsletter. Additionally, some of the links included in this newsletter are affiliate links, meaning I may earn a commission if you make a purchase through these links. Always perform your own due diligence before making any financial or business decisions.