Should You Self-Manage Your Rental Properties?

If you’re like most investors, you want to create extra income.

Whether that was to pay off some bills or to build a savings to set a retirement in place for yourself because maybe your job isn’t going to give you the retirement plan you want.

Zack Childress

Or maybe a reason you want to buy rental properties is to replace your income so that you can leave your job.

There are lots of reasons why people lean into buying rental properties because everyone’s different. And the outcome is for the purpose of that individual person.

There are a lot of benefits with rental properties, such as tax advantages.

Another big reason is for legacy. We want to be able to pass down to our children: something that we didn’t have or something to give them a good start or maybe just to help them a little bit with some income.

But did you buy rental properties to manage them or did you buy rental properties to create cash flow off them?

If we are trying to buy rental properties and manage them, this can be a big headache. When it comes to managing rental properties, cash flow is what we want. This is why we buy rentals – the cash flow.

We don’t buy rental properties to create another job for ourselves. And this is where I lean into management because sometimes we think, “oh, I’ll self-manage it” without understanding the outcome or all that goes into managing properties.

So, to be truly focused on cash flow, we need to take a step back and let management take over.

Don’t let cash flow take over your life.

Sometimes we think too small and we count pennies and we lose focus on the overall goal. Yes, management charges a fee but it is well worth that fee.

If you’re running your numbers and you think about this fee as lost revenue, you’re really looking at it wrong. Because, for what management charges – 8, 10, 12 percent of gross rents, we’re only talking about $50 a month; sometimes it’s $70, sometimes it can be $100 but this goes back to when we run our numbers.

The fee helps you enjoy your life and it allows you to stay focused on finding more rentals and focused on really what you’re trying to do with a rental portfolio, which is manage it and not each property as you build.

When should we self-manage our rental properties?

I get this question a lot as the president of the Madison County Real Estate Investors Association and my answer is, if you’re just starting out and you bought a little single-family residence, then sure, try it out.

See what it’s like to manage. You’ll find the tenant, you’ll need to do the tenant’s screening, collect rents, deal with all the phone calls. Then you can see if that’s what you want to do.

Most cases, you won’t have time for it or you just won’t like it if you do.

If you’re holding several rentals, don’t do it. Put management in place because the next thing you’re going to find out is you’re running around chasing tenants, trying to collect rents.

Sometimes you have to self-manage when you bought the property wrong or got a bad loan on it and it can’t cash flow with property management in place.

In that scenario, you would have to come back to self-management, but this goes back to running your numbers to make sure that you can afford property management when you’re looking at the deal to buy it.

What are the benefits of having a management company?

This could be a 50-page book by itself. There are so many reasons that you should have management in place. Let’s just start off with the first one: safety. Safety for yourself and safety for the tenants.

Management companies have to follow state laws. Sometimes, as a landlord you may not know those laws and so you might be violating your tenant’s rights. You might be doing things that aren’t safe or not legal and therefore you could get in trouble for that.

The other reasons are finding tenants and screening them. Do you have the time for that? Probably not.

Management is also there to deal with all the calls from tenants as your portfolio builds. You’ll be surprised at the phone calls. They call for all kinds of reasons such as a leaky faucet or toilet’s clogged, or their door won’t shut all the way. Management handles all that.

Collecting rents or even chasing rents down when someone is late – these are all cases of what management can do. There’s the eviction process and dealing with that, even if you have to go to court to get them out. Other jobs include scheduling repair work and putting together monthly reports for the rentals for accounting and bookkeeping.

It’s like having a partner who does all the work that you don’t want to do. These are just some of the benefits of a management company and, as you can tell, it’s well worth having them in place versus self-management.

How do management companies work?

Most management companies in our area work where you bring them the property and they step in and take over. They’ll collect your rents for you and deposit them or write you a check to your bank account. They will give you a profit and loss statement on your rental properties each month, so you know what’s going on.

They charge anywhere from 8 to 12 percent on collected rents, which means their goal is to collect as much rent as possible each month and to help you increase rents so that they can make more on their service fees. 

Now, why can real estate investing be easy?

Well, when we look at real estate, yes, it comes with risk. And yes, it can be hard, but in most cases when real estate starts to become easier is when we have the right team to help you run and manage your rental and your investment business.

Management companies are key to making real estate investing easy for yourself when it comes to rentals so that you don’t have to deal with it any of the headaches.

Check out our vendor list at for management companies who are helping investors in this area.

You can also come to one of our meetings and meet some of our vendors, including property management companies. Get to know them to see how they could benefit and how they could be part of your team.

 If you’d like to come out to one of our meetings, visit for information.

(Zack Childress is president of the Madison County Real Estate Investors Association.)

Hays Farm Development: ‘It’s Time; the Community Needs It’

Six to 10 years, that’s how long the Hays family expects the 850-acre, multifaceted development of Hays Farm to take.

Jim Hays, John Hays and Jeff Enfinger, the owners of the property, were on hand Thursday night to highlight the details of the project to a packed house in the Martha deFord Hays Auditorium at Grissom High School.

“For 49 years we’ve been developing communities for people in North Alabama, this is the first time we’ve ever put our name on one,” John Hays said.

John Hays talks about the importance
of the Hays Farm Development.

The development will eventually consist of about 1,000 residential units, three parks and see of new commercial spaces along with the redevelopment of Haysland Square, according to Enfinger.

The first part of the commercial aspect of the development is to raze Haysland Square and develop 175,000 to 200,000 square feet of new commercial space.

“It’s under contract now with a Florida developer who has developed here and we hope to have an announcement this Fall where that center would be redone next year and it would be upscale, walkable and pretty,” Enfinger said.

Enfinger added that they were working with Staples, the only retail store left in the current development.

“We’re providing space for Staples,” Enfinger said. “We have to cut a deal and they have to agree to it, but we’re going to make every effort to keep Staples.”

Jeff Enfinger gives an overview of the master plan for the Hays Farm development

It is expected to take five years before developers get back to the center housing Home Depot and a development north of Mike’s Merchandise, according to Enfinger.

“We’ve got three opportunities to develop and redevelop the high-volume, high-traffic commercial areas,” he said.

The first 500 units of residential development will consist of single-family detached units such as estate homes, patio homes and traditional housing sizes, which will span the $300,000 to $700,000 price points, according to Enfinger. Some of those are being developed now.

The next 500 units will consist of condominiums, townhouses, some lofts over the new retail establishments and possibly some age-restricted housing, according to Enfinger.

“The 1,000 units we’re going to build doesn’t do much for the commercial activity except create sort of a foundation,” Enfinger said. “The commercial activity is part of all of south Huntsville.

“So, if south Huntsville doesn’t become part of the commercial activity then it won’t be as successful.”

The development will have three parks: a 500-acre natural park, similar to the Hays Nature Preserve; a new ballpark with soccer and baseball/softball fields; and a city park, like Big Spring Park in downtown Huntsville.

“We have a park system that I believe will be unrivaled by any park system that I know of in my lifetime,” Enfinger said.

There are also plans to have an entertainment district set up in the new development, possibly around the city park, but Enfinger said most of the specifics were still yet to be determined.

“It was really a difficult decision for the family to decide to let the farm go,” Jim Hays said.

“…But, it’s time. The community needs it; so it was time.”

Jim Hays talks about the history behind the land
that will be used as greenspaces in the Hays Farm Development.

Hays Farm Presentation Set for Thursday

The South Huntsville Business Association will host a community presentation of the Hays Farm revitalization project Thursday in the Grissom High School auditorium. It will start at 6 p.m.  

Jim and John Hays, along with Jeff Enfinger of The Enfinger Cos., are developing the 850-acre generational Hays Farm into a multi-use project with 110 acres of commercial development including retail stores and restaurants; 200 acres of residential area with about 1,000 single-family and multifamily homes; and a 12-acre city park with a potential entertainment component, sports fields and a dog park.

The remaining 540 acres will remain protected land with 6½ miles of walking trails and a nature preserve.

The economic boost to Huntsville is projected to be $450 million.

Representatives from the city, the Hayses, Enfinger Cos., and SHBA will be available for questions.

Stovehouse Grand Opening Set for May 24

What do Huntsville neighborhood pools and the Stovehouse have in common?

On May 24, they will be open to the public, garnering much fanfare; kicking off the Memorial Day weekend and all that comes with endless summer evenings.

The Martin Stovehouse, circa 1929, has been totally reconfigured and reimagined to create an enticing and eclectic variety of restaurants, cocktail bars, coffee houses, boutique and unique retailing, collaborative workspaces, event and entertainment venues, courtyards, play spaces, greenspaces, and more.

The assortment of restaurants offers something for just about every taste.

Built on the foundational bricks of a bygone era, the Stovehouse is Huntsville’s largest “work-play-eat-drink” and events space. The lines are decidedly blurred between worktime and playtime here, as well as the merging of the modern with historic.

The Stovehouse delivers the charm of small-town culture fused with high-tech urban energy.

With ample parking on both sides of the building, there’ll be plenty of room for everyone. There’s a street and a footpath in development that will connect the Stovehouse with Campus 805, thus enhancing the potential for jointly hosted conferencing and special event bookings.

In any case, the convenient location will allow for people to participate in several events on the same evening, without having to move their car.

Recently at the Stovehouse’s recent “soft opening,” guests had the opportunity to “dip their toes into the water.” – quite literally, as it was pouring down rain for the entire event.

Despite the deluge, the place was packed with the crowd checking out the newly configured property, to experience the Pourhouse and check out the rooftop bar while listening to the sounds of Spectrum Jazz.

The funky and very eclectic Company Store was also open for the event, complete with unique offerings of craft sodas, lemonade, and candy.

The store is truly a paradise for kids and nostalgic adults.

A Food Hall of Kitchens, Breweries and Food Trucks Coming to Town Madison

MADISON — At his State of the City Address in March, Madison Mayor Paul Finley told the audience to buckle up for some big announcements coming out of the new Town Madison development this spring. Today, the Breland Companies delivered a big one!

Rendering shows layout of Town Madison around the baseball stadium and Food Hall

The latest addition is a sprawling Food Hall of 18 kitchens curated by local and regional chefs, two breweries, and several stationary food trucks in an outdoor dining area. A central bar with indoor/outdoor seating will serve as an anchor, and developers are talking to several local and regional restaurants about joining the unique dining lineup. 

The Food Hall can be seen to the right in this rendering.

Designed by Smallwood, Reynolds, Stewart, Stewart, an international design firm based in Atlanta, the Food Hall will feature a large outdoor event space and covered stage area for a variety of events including a showcase for songwriters, concerts and big screen showings of various sporting events.

“Town Madison is taking another step toward our goal to provide a new experience in North Alabama living,” said Louis Breland. “We toured some of the finest food halls in the country looking for the right concept. A great food hall becomes a central gathering spot and brings unique energy to a community.

“Along with the (Rocket City) Trash Pandas stadium, the Food Hall and plaza area will become the place to be before a game or any time people want to meet with friends and share new experiences.”

The Food Hall, a partnership between Breland and Fuqua Development of Atlanta, joins the growing roster of tenants at Town Madison including the baseball stadium; several hotels including the avid Hotel, Home2 Suites and Margaritaville Resort Hotel; restaurants; national retailers such as Duluth Trading Co.; luxury apartments and residential communities.

Construction on the Food Hall begins this summer and tenants will be announced by the end of the year.

It is slated to open next spring – in time for the first pitch.

Hays Farm Multi-use Development Planned for South Huntsville

The answer to the long-asked question “What is going to happen with Haysland Square?” is finally provided.

Hays Farm, an 850-acre development, will soon be raised in South Huntsville after the 55-year-old shopping center is razed.

John Hays and Jeff Enfinger check out the plans for Hays Farm (Photo by Steve Babin)

Jim Hays, John Hays and Jeff Enfinger announced plans for the project which will include an entertainment district, nature preserve, homes, retail, restaurants, a dog park, sports fields and nearly 6 1/2 miles of walking trails.

“This land has meant so much to our family, generation after generation,” Enfinger said. “It has been a place where we’ve worked, played and grown as a family.”

The family has created communities around the county for decades and Enfinger said this is the “best and last” of the large communities they are planning.

“Our best and last large, master-planned community, … Hays Farm and its hundreds of acres of green space will now belong to our friends and neighbors in South Huntsville,” he told the Huntsville Business Journal during a tour of the project.

The project, which is currently under construction, will have about 110 acres of commercial development and 200 acres of residential, leaving about 540 acres for protected land. The development is estimated to provide a $450 million boost to the area.

“The Hays Farm project has the potential to transform the face of South Huntsville and bring vitality and excitement to South Parkway,” said Huntsville City Councilwoman Jennie Robinson, whose district includes the development.  “It will add hundreds of acres of green space to the city as well as miles of trails and recreational amenities while preserving the natural beauty of the area. 

“We applaud the Hays family for their vision and hope it will encourage others to reinvest in South Huntsville and improve the quality of life for the city as a whole.” 

A centerpiece will be the 12-acre “city park” which will have a Town Center on Haysland Road featuring entertainment, restaurants and small shops. Enfinger said the park is similar in size to Big Spring Park in downtown Huntsville.

“It will be a Providence-type (development) between Hamilton Square and Grissom,” Enfinger said, referencing the west Huntsville development. “The park has a village green like Providence.”

Hays Farm will have three components, Enfinger said. There will be the community park, nature preserve and ballfields – a 20-acre recreation baseball/soccer complex operated by the city’s Parks and Recreation Department.

More than 1 million yards of dirt has been moved for the Hays Farm project. (Photo by Steve Babin)

Some 1,000 housing units will include single-family detached, townhouses and rental units. More than 500 single-family homes will range from $300,000 to $700,000. There are plans for 150 townhouse units and 350 multifamily rentals. Each neighborhood within Hays Farm will offer access to trails and an open space network that connects the community to all of Huntsville.

Haysland Road will also extend from South Memorial Parkway through the development to Hobbs Road, a couple hundred yards east of Redstone Arsenal’s Gate 3.

“The Haysland Road extension should be finished by September,” Enfinger said. “It goes through the series of lakes – wonderful scenery.”

Madison County Commissioner Phil Riddick, whose district includes south Huntsville, said Hays Farm is an exciting change and addition to the area.

“South Huntsville has not seen new development on this scale in decades.  Not only is it substantial in size with greenways, new retail, restaurants and hundreds of new residences, but it will change the face of the community,” he said. “This will be something new and exciting, and will add a lifestyle flavor that we have not seen before in South Huntsville.  It will foster further new development and will create a new demand for living in our area. 

“We are so thrilled that the Hays Family has embarked on this development and are looking forward to it being completed.”

The developers and South Huntsville Business Association have scheduled a community meeting for 6 p.m. May 30 in the Grissom High School Auditorium.

Is Warehouse Space a Good Investment?

There are so many ways to make money in real estate, whether you’re just getting started and you want to use strategies like wholesaling or maybe creative financing; or maybe you want to do the fix and flip model. But, in most cases, people seek real estate investing for the purpose of building wealth and cash flow.

So when we take a step back and we look at all the many different ways to make money in real estate, which one is going to best serve you? And if that is moving forward with cash flow, then you’re going to be looking at income producing assets and one of those are warehouse space.

Zack Childress

To be clear, a warehouse is just a building for storing goods. And warehouses are used in many industries and for many reasons.

It could be for importing goods, exporting goods; it could be for manufacturing-type businesses; it could be for transporting and storing goods for businesses.

These spaces are usually large plain buildings in an industrial park, on the outskirts of town in most cases.

Warehouse space is an essential need for our community. It’s an essential need for businesses in general.

If you are looking to lease a building for your business you’ve got to start thinking about what type do you need? Do you need a warehouse space? Do you need a manufacturing space or do you need flex space?

Flex space tends to be one of the most popular types of warehouse opportunities either for businesses seeking to lease or for investors seeking to lease them out.

Flex space leans more toward the demand and the current market right now. Flex spaces are warehouses with a small portion of them built out into office space.

Some things that you do want to think about when you’re looking is: What is your monthly budget? What type of space do you need by square footage? Where’s the location? Is it going to fit the need of your business and transportation?  What type of features are needed? Do you need raw warehouse space or are you going to need fiber optics or telecommunications built in there?

Also think about the lease terms. A lot of times you’re signing three-, five-, sometimes six-year leases. Some of those leases are going to have what’s called a gradual increase in lease payment over time.

What type of inventory is really out there when we’re looking for leased space?

In the industrial or flex type warehouse space in Huntsville, there are less than two dozen buildings available for lease.

This is a sign that you should really look at as an investor because there’s just not a lot of lease space available. There are only three buildings available for lease in the industrial and flex space market in the Madison area; in Birmingham there are 38.

Now, if we take another look and look at what’s for sale in the industrial warehouse and flex space community in the Huntsville area, there are less than a dozen buildings for sale; Madison, are only two for sale and, in Birmingham, there are only 13.

So, what does this mean?

Well, this means that there’s not enough space available and what is available is already being consumed, especially for the for sale side. We need more of it because the demand is obviously there. When you look at Madison only having two and Huntsville with 11 that are available on the market right now, there is a huge opportunity for this.

From the investing side, I’ve always been a fan of warehouse space. I’ve owned warehouse space for many years for a few reasons. One, there’s low maintenance in warehouse space. The tenants typically are long term, but they are used for business and not personal. And the leases are always in our favor because we can do triple net leases that are very hands off from a landlord’s point of view.

You don’t have to deal with the same type of issues that we deal with when we’re renting out apartments or single-family homes. We’re signing agreements with businesses and they tend to stay for long periods of time inside the warehouse.

What is a gross lease, this is where a tenant is going to pay typically higher monthly rent. But it’s also because they’re covering the taxes, insurance, maintenance, utilities, and any other expenses that come with that building.

Now the most common least that you’re going to see out there from a either looking to lease a building or as an investor buying a warehouse space and leasing it out is known as a triple net lease and this is where the tenant is going to pay their pro rata share of everything that consists of insurance, taxes, maintenance, and typically any common area upkeep. They will also pay for their own janitorial services and utilities that are associated with them acquiring the space that they’re in. This is probably one of the reasons it’s the most common lease out there, which is known as the triple net lease.

What is the cost range on average to lease a warehouse space?

Typically, in the flex space area, you’re going to see anywhere from $6 to $9 a square foot for the year. So, if it’s a 2,000 square-foot building that you’re looking to rent out as an investor, then you’re looking at $7 a square foot, which means your tenant will pay roughly $1,166 a month for that space – making your yearly income $ 14,000 for the year.

Now, on the industrial side, you could see anywhere from $7 to $18 a square foot. And typically, when the price gets higher, it’s because the space is newer or there are more features,

There’s been a huge demand for new warehouses. When you look at everything from Amazon and Facebook and Google and the creation of cryptocurrency, they’re all looking for new space, new cooling system, new digital input and output, updated electronics, new communication systems, etc.

The high demand for new warehouses puts us in a little bit of a disfavor for old warehouses which don’t have the features that new warehouses have.

In my experience, I have found that warehouses are among the safest investments.In most cases, it can be easier to develop a new warehouse than it is to buy an older warehouse and bring it up to date.

Now, on the other side, if you can find land cheap, building the new spaces will help tremendously in meeting the need and supplying the demand that’s out there right now. Just think again about Madison having just two buildings for sale in the industrial and flex space arena.

What it really comes down to is building wealth through real estate. Whether you’re choosing warehouse space, industrial space, flex space, strip centers, apartments or single-family homes, it’s all for the sole purpose of building wealth through cash flow and owning income-producing properties.

When people ask what area should they go into, I’m always going to direct them to start where it makes sense for them.

Where do you have the most knowledge? Where are you prepared to move into the market? Is that single-family homes? Small apartments? Warehouses? Industrial flex space? Strip centers?

It’s really where you feel comfortable getting into the market or where you feel comfortable getting educated on the processes of working this business we refer to as real estate investing.

(Zack Childress is the president of the Madison County Real Estate Investors Association and has been an investor for nearly two decades. The Madison County REIA meets monthly. Visit or

Abaco Expanding to Redstone Gateway

Abaco Systems, a manufacturer of embedded computing solutions, is the latest company to join the ranks of Redstone Gateway.

The company, which provides military, defense, aerospace and industrial applications, plans to relocate in the fall. Abaco has leased 37,400 square feet in 8800 Redstone Gateway, a 76,000 square-foot building under construction at Redstone Gateway, the mixed-use, class-A office park.

“We’re delighted to have identified Redstone Gateway as the location of our new headquarters,” said Rich Sorelle, president and CEO of Abaco Systems. “This new facility will provide us with much- needed additional space, and will be vital in ensuring that we can fulfill our commitments to our customers as our business continues to grow.

“I’d like to thank COPT (Corporate Office Properties Trust) for their part in making it happen.”

Redstone Gateway is being developed by COPT and Jim Wilson & Associates. As a result of this transaction, the building is 100 percent preleased.

“Abaco Systems has had a strong presence in Huntsville for over thirty years,” said COPT Chief Operating Officer Paul Adkins. “We’re thrilled that they have decided to make Redstone Gateway their home to be closer to their U.S. government contracting customers, to have access to walkable amenities, and to use new facilities as a recruiting tool.

“Their lease, along with other recent leases, highlights the value proposition of Redstone Gateway.”

Westside Centre in Huntsville is Purchased

Westside Centre, the retail power center on University Drive, has been sold to Big V Property Group of Charlotte, N.C.

Holliday Fenoglio Fowler marketed the 477,408-square-foot center for Nuveen Real Estate and SITE Centers.

Westside Centre, anchored by a Super Target, is home to Ross Dress for Less, Shoe Carnival, Five Below, Big Lots, PetSmart, Men’s Wearhouse, Tuesday Morning, Stein Mart, Dollar Tree, Zoës Kitchen and Party City. 

Completed in 2001, the center is at 6275 University Drive and is visible to more than 58,000 vehicles per day.  It is adjacent to the 4,000-acre Cummings Research Park, the second largest research park in the country and the fourth largest in the world.  More than 38,500 residents earning an average annual income of $81,000 live within a three-mile radius of the center. 

BVPG owns and operates 44 grocery and discount anchored neighborhood and community shopping centers totaling 5.3 million square feet, primarily located in strong secondary markets throughout the Southeast.

Nuveen Real Estate is one of the largest investment managers in the world with $125 billion of assets under management. 

SITE Centers is an owner and manager of open-air shopping centers that provide a highly compelling shopping experience and merchandise mix for retail partners and consumers. 

Neither rain, nor more rain, nor even more rain can slow the progress at MidCity Huntsville

While constant rain, some heavy enough to cause flooding, has been a seemingly daily companion to the Tennessee Valley community, the wet conditions haven’t slowed progress at MidCity Huntsville.

“We only had three good days in December,’’ said Nadia Niakossary, project coordinator for developer RCP Companies. “But we figured that into the time frame. We’re still on schedule.’’

The multi-use MidCity campus occupies the former Madison Square Mall property and surrounding area. Ground was broken in 2017, the first business on site opened in August and completion date is 2022.

Dave & Buster’s is nearing completion and scheduled to open this summer

Niakossary said work was proceeding on current projects despite weather delays.

“We are diligently working on the construction of the University Drive-facing retail blocks,’’ she said. “When visiting MidCity today, you’ll see five vertical buildings. Top Golf and The Camp with Alchemy Coffee are open for business.

“The Camp just reopened (in March) for springtime, with the food trucks and bar open Thursday through Sunday and the coffee shop open seven days a week. We have a diverse lineup of live music and unique events happening there every weekend.’’

High Point Climbing and Fitness is nearing completion in the center of the frontage and anticipates an opening this spring, Niakossary said. In front of High Point, REI Co-op’s foundation has been set and steel frames are going up.

The opening for REI Co-op, an outdoors store, will be the first for the company in Alabama.

Also, the Dave & Buster’s building is also nearing completion on the west side of MidCity, near Old Monrovia Road. Dave & Buster’s is on schedule to open this Summer.

Construction continues on the REI Co-op store, the first in Alabama

Meanwhile, Niakossary said Pies & Pints is under construction and the building that houses Wahlburgers and other commercial uses has site work complete in preparation for the foundation.

“We are in the design process for the $30 million Aloft Hotel, The Point and Jake’s Mews,’’ she said. “We are also in preliminary stages of the $75 million, 300-unit multi-family residential (complex) over the retail block in the center of the project. We’re also working on a $20 million mixed-use, office-over-retail building.’’

According to the MidCity website, when completed, the campus will include a total of 350,000 square feet of specialty retail, 150,000 of high-tech office space, a wide range of dining options, the 100-plis room hotel, and 560 amenity-rich residential units.