The first day we worked until 10:00 pm. The next day we were there until midnight. The following day 2:30 am. By Friday we were running low on energy and we finally had to quit when we received a budget with some of the formulas overwritten, thus adversely impacting our ability to correct the file.
The situation is sad and I am not sure of the background. We were hired to be the asset manager, so we had to review the budgets, visit the sites, and maybe provide suggestions on improvements to turn around the properties. A lot of the properties are in poor shape and suffer from low occupancy rates. Our “client” was forced into bankruptcy due to disputes with one of their investors, so for a couple of months these properties had little to no maintenance. The court, the owner, or the investor brought in a bankruptcy turnaround specialist to keep things going until the properties could be sold. I believe this specialist in turn hired us.
The impetus for the budgets was because the “owner” or company was running out of money and needed to go back to the bank to ask for more funding. Here’s where my boss and I came in. We spent maybe 2 weeks reviewing the budgets from the property management team. While doing so, we found the budgets to be illogical: for example, going from a 40% occupancy to 95% occupancy in a year struck me as very unrealistic, and that’s just for starters. So we had to ask them to come in for meetings so we could get a better budget. We sent them questions beforehand to give them a chance to fix the numbers or prepare their answers.
However, the people who came to the meetings were not the ones who had developed the budgets! Friday or Sunday or the night before was the first time they had encountered the budgets. They were thrown into this cold! Many of them were stressed out about this. The first one was a real fighter and impressed us and it was through her that we got our first inkling that it was not the property managers who had done the budgets. They were built by corporate.
So it was a long week going over almost each line to build more realistic budgets. After the first day, I knew we were not going to finish by Friday. It was just not possible. I keep asking myself if we were too detailed in the review but I go back to how bad the budgets were that I keep concluding we had to rebuild the budgets and that means going through most if not all of the budget line items.
I have no idea what the next week will bring.