A smoker in a non-smoking building who throws butts into the gangway, causing a major, five-alarm fire.
A tenant who demands the property’s dog-run is chemically washed twice a day which will in essence harm the dog.
Toilets clogged with non-flushable wipes creating sewage back-ups.
A broken elevator in an 18-story building full of elderly residents.
Tenants raving on the roof.
In property management, snafus like these are par for the course — and they’ve all happened to Mike Zucker, founder and managing partner of Peak Properties. In fact, those tenants raved on the roof the very day that Peak Properties took over management of their building. “I chose to break up the party versus join it,” he says with a smile.
Every day is different for Zucker. But that’s what he finds exciting about the industry.
Zucker first came to learn about property management through an ex-relative. After that relationship ended, he worked a series of odd jobs, delivering pizzas, selling kitchen cabinets, and slinging BBQ at the original Bub City. “I hustled,” he says, before he pivoted back to real estate, renting apartments on the weekends and working full time for a retail brokerage firm. After a client asked him why he wasn’t managing apartments on his own, Zucker listed the pros and cons and ultimately decided to start his own management company.
He was just 28 years old when he founded Peak Properties. At that time, in 1998, it was just a basement office with two accounts, a telephone and a whiteboard.
Today, Peak Properties manages almost 10,000 units, mainly in Chicago and the surrounding suburbs. They collect over $200 million a year in rents and employ approximately 130 people, plus a team of 50 independent brokers.
Zucker views property management as a triangle with connected points — accounting, management and leasing, united by customer service — and Peak Properties handles all those areas. They manage residential buildings for all types of clients: smaller owners of property, high-net-worth individuals and larger institutions such as banks and insurance companies.
Meanwhile, a company subsidiary, branded as Cross Street, handles leasing and marketing. “As we’ve grown,” Zucker says the marketing division “needed its own identity” and describes its relationship to Peak Properties as a “strategic alliance.”
Even with a streamlined process, though, problems arise. “You are in a constant state of addressing issues,” Zucker says. (In the case of the smoker, literally, “putting out fires.”) So, the business becomes about addressing issues in a way that eases the burden for property owners.
For example, during a recent hot spell in March, many residents called Peak Properties because their buildings’ air conditioning was not turned on yet. Due to how those properties were built, there was no way to turn the air on early, per Chicago’s Residential and Landlord Tenant Ordinance. “A tenant might call the city, call you direct, email everyone in your office and start a WhatsApp group for the property, but there is literally nothing you can do,” Zucker says. So, how does a property manager deal with that?
“By being patient and suggesting alternative solutions,” says Zucker, “and explaining to residents exactly what’s going on. You get in front of the issue and have an answer to the question before they ask it.” In March, Zucker said Peak Properties set some of those hot residents up in an Airbnbs or hotels or provided them with fans.
Take another classic example: a tenant who is not paying rent. According to Zucker, someone currently under eviction in one of their buildings has filed for bankruptcy and is now complaining about issues with their unit. In that case, Zucker says, “The solution is you have a court date, go to court, and you spend money there to solve the problem. Part of our job is dealing with the politics of the city of Chicago.”
“Property owners are dealing with the assessor, they’re worried about crime, they’re worried about tenants, they’re worried about insurance, they are worried about normal work orders and capital items. But we try to do the worrying for them,” Zucker says. “The hard way is usually the right way.”
Even more recently, Peak Properties began handling fallout from the sudden Foxtrot grocery chain closure. They manage apartments above certain Foxtrots and, when the stores closed without warning, food risked rotting. There was also no garbage or utility plan in place, as Foxtrot oversaw that. “We’re dealing with the relationship between commercial [spaces] and the tenants above,” Zucker said. In this case, Peak Properties needed to engage counsel and, per the lease, legally entered the building to donate perishables to a food bank. They are now working with attorneys on behalf of the property owners, and Foxtrot, regarding the future of the space.
All of that may not sound very glamorous. But it’s rewarding for Zucker. “I’ve met an inordinate amount of great people through [property management]. Great residents, vendors, brokers, bankers and company executives. Many doors have opened to me, but it’s all through hard work and patience. [It’s about] the ability to take losses without going crazy.” Zucker says. “In property management, one needs to think like an optimist yet prepare like a pessimist.”