Most property management firms are laser-focused on the top line. Frank Gervasio, Director of Finance at OneWall Communities, says that’s exactly where they go wrong. A single lost lease, just $1,000 a month, can cost five times that amount to recover, yet many ownership groups still negotiate over payroll budgets that are $10,000 too high.
Gervasio, Principal and Director of Finance at OneWall Communities, explains that expense management isn’t just about cutting costs. “Sometimes those expenses have a real impact if you’re not spending them. What you want to measure is the efficacy of the dollars.” This distinction is simple in theory but rare in practice.
Gervasio points to a pattern across portfolios: individually small line items that quietly compound. Vendor contracts with automatic annual escalators, auto-renewals that go unflagged, and billing structures that balloon across 20 assets. “Many a mickle makes a muckle,” he says. When management companies don’t track contract terms with granularity, ownership often discovers the damage too late.
At OneWall, financial oversight begins before a management contract is signed. During due diligence, the team conducts 100% unit walks, catalogs the age of HVACs and roofing, and reviews books quickly. “Every day that deferred maintenance goes unaddressed, it’s compounding,” Gervasio notes.
The gap, he argues, stems from incentive structures. Fee-based management companies are paid on collections, making revenue a priority and expense oversight an afterthought. Overhead costs often get absorbed into catch-all categories like G&A or marketing, where they’re hard to scrutinize. “I’ve seen companies send financials where they don’t write off bad debt, they just move it around on the balance sheet,” Gervasio says. OneWall’s third-party management services itemize every point solution with no markup, allowing owners to see technology costs and choose whether to adopt them.
One common pushback is that payroll is too high. Gervasio responds directly: “This is a people-centered business. The people taking care of residents are our on-site teams. If we don’t take care of our teams, they can’t take care of the people we’re housing.” An overworked team creates vacancies, collection gaps, and maintenance backlogs—far more expensive than a higher payroll line. “It’s the penny-wise, pound-foolish conversation,” he says.
