{ } Introducing Riverside Capital. Together We Build Communities

winter 2016 { } Developments Together We Build Communities @michaels Fish Tales & Other Stories for Employees of The Michaels Organization Intro...
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winter 2016

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Developments Together We Build Communities

@michaels

Fish Tales & Other Stories for Employees of The Michaels Organization

Introducing Riverside Capital

{ C o v e r S t o ry

Introducing Riverside Capital The Michaels Organization’s family of companies now includes a full service real estate investment company called Riverside Capital. Riverside’s mission is to provide investment capital and asset management services for high quality housing developments. The company works in partnership with developers and investors who share this commitment, and they strive to make every project impact the communities in which they work. This new company is the evolution of The Michaels Organization’s tax credit syndication company, formerly known as Prestige Affordable Housing Equity Partners, that for many years led the syndication of Low Income Housing Tax Credits for Michaels Development Company’s affordable housing deals, under the leadership of our Chief Financial Officer Joe Purcell. Two years ago, the senior leadership of our organization, including Mike Levitt, John O’Donnell, and Joe Purcell, decided that the potential existed to grow this sector of the business and stand up a fully independent tax credit syndication company that could work not only with Michaels Development Company, but other development companies as well.

To launch this expanded effort, The Michaels Organization brought in Sebastian Corradino to serve as the company’s new President. Sebastian brought more than two decades of experience in real estate investment and development to his new role standing up an independent operation. Now, with an expanded staff of experienced professionals, new technology, and a sophisticated platform in place to offer superior service and innovative solutions to both developers and investors looking to connect to capital for their affordable housing communities, the company launched in January with the new name Riverside Capital. The name Riverside was chosen because it evokes the outdoors, the environment, beauty, flow, flexibility and even strength, “Riverside” is a place where people have gathered for thousands of years to join together, to build community and to do commerce. So the team felt it was a natural progression to take on a name that represents flow, flexibility, strength and community. You can learn more about who they are and what they do at their new website www.Riverside. Capital

Riverside Capital synidcated the LIHTCs for North Penn Commons, an affordable housing community in Lansdale, PA, being developed by a non-profit organization.

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The Michaels Organization Welcomes New President of Michaels Development Company Gary Buechler has been named president of The Michaels Development Company. Gary succeeds Ava Goldman, who transitioned to the role of Executive Consultant in December after 23 years with the organization, the last three as Michaels Development Company President.

Gary Buechler

“Gary joins us at a time when the Michaels Development Company has a pipeline representing nearly $1 billion in total development costs, and a team of developers who are the best in the industry,” said John J. O’Donnell, President of The Michaels Organization. “With Gary’s wealth of experience in every aspect of development, we are confident he is the right leader to ensure Michaels Development Company’s continued growth and success going forward.” Gary brings over 25 years of experience in both development and business operations management to his new role. Most recently, he served as Managing Director of Development at Lendlease Americas, a leading property and infrastructure company that offers services in development, investment management, project management, construc-

tion, and asset and property management. With Lendlease Americas since 2002, Gary held a number of key positions, including Chief Executive Officer of various operating businesses. He led the firm’s activities in a number of sectors, including military housing, healthcare, and urban development. Before joining LendLease, Gary was a partner in a private law firm, where his practice specialized in real estate transactions. “Michaels is an organization that makes promises, keeps promises, achieves results, and lives its core values everyday,” said Gary, who assumed his position, effective Jan. 4. “I am honored and privileged to be able to lead a company with a 40+-year track record of success and which is committed to excellence and driven by a mission to create innovative, quality affordable housing,” he said. The Michaels Development Company has developed more than 50,000 units since 1973, and is the number one private-sector affordable housing owner in the country. It was one of the first two companies, along with Interstate Realty Management, which The Michaels Organization’s Chairman and CEO Michael Levitt created in 1973. Gary becomes the fourth person to serve as the company’s president, following Mike Levitt, Bob Greer, and Ava.

Up Close with Gary Buechler Q: What was it about The Michaels Organization specifically that attracted you to apply for the position of MDC President after so many successful years with Lendlease? There are many factors that attracted me. The Michaels Organization has more than its fair share of truly phenomenal people and I wanted to be part of the team that has made The Michaels Organization the leading developer, manager and builder of affordable housing and one of the largest multifamily developers in the country. The organization’s business model – which I call, the “integrated model,” combining development, construction, capital raising, long-term management and ownership of real estate – is very pow-

erful and allows us to achieve great outcomes for our customers, our teammates and the company. Working in an integrated model can have its challenges and frustrations, but when we get it right it leads to extraordinary results. I want to help The Michaels Organization get this right. Finally, and most importantly, I was also attracted to the company’s Mission and the Core Values that guide our day-to-day operations. The Mission and Core Values are important to me, because it is not just about achieving worthwhile results; how we achieve them is equally important. Q: How do you define leadership? Leadership is a state of mind. Leadership has

nothing to do with a title; we can all be leaders. Leaders recognize that they largely control their own destiny and they accept accountability and act. The 10 percent of life that is ‘what happens to us,’ is uncontrollable and sometimes unfair. The other 90 percent of life is how we chose to respond to ‘what happens to us’. Leaders chose not be a victim of the 10 percent. Q: Do you have a leadership philosophy? From an organizational standpoint, good leaders must be servants to the team. They exist only to serve the team. A leader’s first responsibility is to enable, empower, and inspire the team to achieve the goals of the company. I firmly believe that when things go right, a leader recognizes that

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{ Team Announcements

the credit belongs to the team—those who did the actual work of getting it done! When things go wrong, a leader accepts accountability and owns it. Q: What are you most excited about in your new position as president? There are so many things about the position that excite me. Most of all, it’s the opportunity to work with wonderful professionals at The Michaels Organization to help deliver affordable and workforce housing to people around the country and to help build upon the legacy started by Mike Levitt, Bob Greer, Ava Goldman, and countless others in Michaels Development Company and the broader Organization. Q: Can you tell us a little about your family? Yes, I have a wonderful family. I met my wife Cressa on our first day of college in the dorm at the University of Michigan. A former retail bank manager, Cressa is pursuing her love of photogra-

phy by starting a business as a photo organizer (How many of us have thousands of photos stored across multiple electronic devices?). We have two children. My daughter Colette is 16 and a junior in high school. She plays volleyball and is busy with college prep work. My son Garret is 14 and a freshman in high school. He loves history and plays football (smallest kid on his freshman team, by a lot) and hockey. Finally, we have a miniature schnauzer named Cookie who we affectionately call Cookie Monster for all of the mischief she gets into. Q: What are some of your favorite hobbies? My favorite thing is to hang out with family and friends. Beyond that, I like to take walks, travel, read and watch my beloved Michigan Wolverines. Q: What’s your favorite sports team?

the New York Giants. As a teenager, I was at the game in 1978 where Herman Edwards scooped up “The Fumble” as time ran out and turned a solid Giant’s win into utter humiliation at the hands of the Philadelphia Eagles. And no, I don’t hold a grudge. Well, maybe a little. Otherwise, I love to watch the Wolverines play football. Go Blue! Q: What’s the most recent movie you’ve seen? Star Wars: The Force Awakens Q: What are you currently reading? The Billion Dollar Spy Q: What’s the favorite thing on your IPhone right now? Notability, with news apps such as CNN, WSJ and ESPN close behind

Here’s where it gets dangerous, since I am a North Jersey kid working in the shadow of Philadelphia – my favorite professional team is

Mary Keshisian Promoted Mary Keshishian has accepted the position of Regional Vice President for Interstate Realty Management Company. Mary’s portfolio will include Southern California, Nevada and Colorado. Mary Keshishian joined Mary Keshishian Interstate Realty Management Company in May of 2009, since then she has overseen a very diverse portfolio of assets consisting of LIHTC, HUD, RD and Conventional properties in IRM’s West Coast Region. She has played an integral role as a leader within The Michaels Organization and IRM as our West Coast Region has grown from 11 California based properties in 2009 to nearly 100 properties in 5 different states in 2016. Congratulations, Mary!

IRM PM Advisory Committee Members Announced Congratulations to the following IRM Regional Property Managers, who will be serving on the RPM Advisory Committee in 2016: Mario Molano

Mary Keshishian

Gina Young

Dawn Nielsen

Christy Stuckey

Anna May Strovek

Tracie Clemenz

Tom Galyardt

Vicky Brutto

Cedric Burrell

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The Michaels Organization Educational Foundation Announces 2016 Resident Scholarship Opportunities The resident scholarship application for the 2016/17 academic year is now available on The Michaels Organization’s website and on our intranet. Kick-off events designed to encourage residents of our affordable housing and military communities to apply are being planned at sites around the country. This year, The Michaels Organization Educational Foundation has committed awarding at least $225,000 to deserving students. Please encourage residents to take advantage of this wonderful opportunity!

Michaels Employee Scholarship Recipient Making Her Mark at the University of Florida Congratulations to Amanda Boczkowski, the daughter of Mahoney Elderly’s Site Manager Lisa Cameli, and a 2015 MESP recipient, who Amanda Boczkowski recently won a is a recipient of a “Best Poster” Michaels Employees award in a comScholarship. petition sponsored by the University of Florida’s department of Biomedical Engineering, where she is studying physics. The contest seeks to answer the challenge all scientists face in explaining their research projects to the public and even to other scientists. UF’s department of Biomedical Engineering holds a competition in which student researchers explain their projects orally and in poster form. The

competition showcases the quality of student research projects conducted during the academic year and inspires classmates in the biomedical engineering programs to pursue research.

Congratulations Teammates! We are delighted to announce that Anna May Stroyek has returned to The Michaels Organization as a Regional Property Manager for Interstate Realty Management Company. Anna May brings to us over 25 years of experience in multifamily and tax credit housing experience—18 of those 25 years were with Interstate. Anna May has SHCM and CPO certifications. Anna May will be taking over the portfolio handled by Paul Sassani, who has accepted a position in the new underwriting department being created within The Michaels Organization’s Corporate office. Welcome back Anna May! The Maintenance Super at Charter Arms Apartments, George Preston, has retired after 20 yrs of dedicated service to IRM and the apartment community. Thank you to Charter Arms Apartments Site Manager June Szweda for sharing photos of his retirement party.

JOIN US! All Staff Virtual Town Hall Meeting Thursday, March 24, at 3:00 p.m. The next all-team“Town Hall” meeting is scheduled for Thursday, March 24, at 3:00 p.m. Eastern time. Please plan to join us and engage in a “virtual chat” with the senior leadership team. You can submit questions live or in advance. Look for an more details in your email inbox soon.

Welcome back to Dave Lukens who came back to the Michaels family in January as a Development Officer with MDC. Dave will be working primarily on the long list of RAD/Transformation projects currently in MDC’s pipeline.

The team at Charter Arms Apartment Celebrated George Preston’s recent retirement.

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By Michael J. Levitt Chairman & CEO

Year in Review:



State of Company 2015

I love when I give the state of The Michaels Organization address to you, but I am sorry that I have to start off with a sad note this year. We lost a great friend and incredible teammate this year – Bob Sampson. He died of cancer at 64; much too young. He worked with us for 34 years, starting as a superintendent at our community in Bridgeton, N.J. and rapidly moving up to IRM’s Vice President of Government Affairs. He may have been the most knowledgeable person in the country when it came to the HUD Mark-to-Market program, and he was my teammate of the year in 2005. Twenty-six years ago, he was in an automobile accident, got battery fluid in his eyes, and badly damaged his sight, but he never quit! He fought it, got treatments, and continually came to work and did his job brilliantly. We all miss him.

tion company, Prestige Building builds many of them; our syndication company, Riverside Capital, sells the tax credits that finance them, and then IRM manages them.

and we are still a debt free organization. I think that is remarkable. I don’t know any other development company of our size that can operate on its own capital.

Our military housing business houses more than 57,000 military families. We give them the best housing they can get.

Michaels Development Company

Now, I don’t want the University Student Living and the teammates working on our new market-rate housing portfolio to feel left out because they made us lots of money. This year, Pat and I took some of that money, plus the donations our organization raised, and awarded 233 college scholarships to residents

My wife Pat and I have authorized Bruce Johnson, the independent consultant who administers The Michaels Organization Educational Foundation, to annually award a special college scholarship in Bob Sampson’s honor. I always remind you that we are all so lucky to work in an organization where we can not only earn a good living but also give back to society. In our affordable housing business, we house thousands and thousands of residents better than they have been housed before. Michaels Development Company develops the apartments; our in-house construc-

Michaels Development Company did not have its best year in 2015, but we do have the very best development team in place that this company has ever had. with a pipeline of 29 projects representing $700,000,000 in development costs closing next year, we expect 2016 to be the best year Michaels Development Company has ever had—by far. Deserving of special mention is MDC’s Vice President Mike Boettger and (now retired) Development Officer Kathleen Paley of California. they closed out one job – completed renovations on two jobs, began renovations on another job and secured 9% tax credits for three additional jobs for a total of seven projects this year. Also deserving special mention is Joe weatherly and his super business development staff. they are really building up our pipeline! Interstate Realty Management

in our affordable and military housing communities, as well as children of company employees totaling $733,000. Now, doesn’t that make you feel good about yourselves! Let’s look at each of our organization’s individual companies and talk about how they did in 2015. Our gross revenues were $1,184,750,000

irM collects $1,181,000 rent dollars per working day. they manage 344 communities with over 67,000 residents and more than 31,000 units. their profitability was down this year due mainly to the financial performance of a number of troubled properties where irM was forced to advance payroll. while their profitability was down this year, irM has made some great strides in positioning itself for the next 10 years of growth. First, Kimberlee Schreiber has been selected as the new President of irM. Kimberlee joined us six years ago to run our west Coast

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Continental Mortgage Corp. Our FHA mortgage company, Continental Mortgage Corp., did not close on any acquisitions in 2015; however Jim Miller and his team at CMC did dispose of four properties that we wanted to sell, giving us over $8,000,000 in benefits. CMC also refinanced two loans totaling over $14,000,000. Jed Henderson did his usual excellent job. Prestige Building Company

President John O’Donnell Introducing Mike

operations. She became President of IRM on November 2nd and we look forward to great things from her leadership there. Second, IRM took on the difficult task of converting from their legacy accounting and compliance platform, RUMBA, to a new platform, RealPage. They worked out a 12-month conversion plan that I am pleased to report is complete. This conversion would not have been possible without the leadership of Don Miller and the unwavering support of the entire compliance, IT and billing teams. Well done! Finally, IRM doubled down on their training and support efforts this year by undertaking a re-write of their entire Policy and Procedures Manual, which is posted on the Organization’s Intranet. To date, IRM has posted over 80 online training modules that staff members can access at any time to get the most up to date guidance on issues they are faced with every day. Other IRM accomplishments in 2015: n  Commenced management of 20 new

properties n Reduced travel and entertainment

expenses by more than 18 percent—saving over $200,000—and far exceeding the goal of a 10 percent set by Mark Morgan at the beginning of the year.

Russ Maynard, President of Prestige Building Company, came to our rescue again. Last year, he rescued a University Student Living housing job in Fayetteville, Arkansas—the builder screwed up and the job was not going to open in September for the new school year. Russ jumped in, bringing his own work crew, and made it happen. This year, Sugar Estates, a job Milt Pratt was developing in the Virgin Islands, and that Russ was building, was in deep trouble. Closing was delayed for many months and by the time it started there was a real concern that completion would not occur by December 31, resulting in the recapture of tax credits which would have been a real disaster. The construction lender even stopped funding. Russ did his usual fantastic job and with great help from Jerry Otto who was the man in his field and with the employment of approximately 100 in-house employees, 83 of which were Section 3, Prestige pushed through with MDC’s help to get it done. The presence on the Island has brought us the opportunity for partnering with local businesses and the award of the Historical Main Street Improvement Project on St Thomas. The future is bright in the USVI. Russ and the Prestige team have completed approximately $80 million in work this year and have a pipeline for another $90 million for 2016. They have taken on their first student housing project in Pensacola Fl. for University Student Living.

Prestige was invited to bid on projects for National Church Services, the largest nonprofit affordable housing developer in the nation, and was awarded a senior project in Phillipsburg New Jersey. We expect that this relationship will bear lots of fruit in the future. Prestige also performed the first explosive demolition ever performed in Jersey City on a job that MDC’s Joel Silver is leading. WHAT A BLAST!—Russ says, with no pun intended. The 3 ten story structures were imploded simultaneously within the proposed footprint, thankfully without a hitch. We look forward to their replacement with 126 townhomes. Michaels Management Services I love Ron Hansen’s military housing – they give us no trouble and make us a ton of money. MMS added four locations within California to their previous seven locations where they are managing the military housing. Again Ron did this in fine style with a warning on Saturday of a major takeover on Monday. In a flash of an eye, 4 locations with over 5,300 units were added to their management portfolio. So many people helped from IRM, HR and IT but standouts were the usual MMS Champions, Heather Plummer and her team. They now manage 16,000 military housing units and collect $705,000 in rent each working day! In 2015, following the completion of Fort Huachuca, they finished work at Fort Leavenworth, 708 homes. They still continue to see success on all fronts as their project staffs exceed all expectations, bring in great fees and get outstanding results on customer satisfaction Surveys. Huachuca was in the top three in the Army. Ron Hansen, Mike Kruse and Teri Polidora continue to assist On-Campus Student Housing. Currently we have the most exciting new project at Rowan University in Glassboro – with a $100 million freshman building.

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Riverside Capital Riverside Capital LLC (the new name of our tax credit syndication company) is completing their second full year of operations and is showing a profit. They will do over $100 million of volume with 2015 projected revenues of $4.5 million. In 2015, they hired 10 staff, doubling their team size and substantially expanding their capabilities. Chaz Ramos is transitioning from the acquisitions group to lead their Fund Management Group. Fund Management involves core investor reporting and relationship support and Chaz has the analytic and relationship skills to succeed here. We are very excited about this move, and so is Chaz. Andrew Anania was named a Michaels Achiever. In 2015, Riverside’s active investors were: Bank of America, US Bank, SunTrust, AEGON, TD Bank, Citizens Bank, and Bank of the West.

USL’s Joe Coyle Named ‘Teammate of the Year’ by Michael Levitt

2015

University Student Living

Our USL Team

University Student Living had $570,000,000 of student and multifamily communities under construction during 2015.

Magazine as #5 of the top national developers.

Within 4 ½ years of launching the company, USL has been recognized as a national leader in student housing development and was listed by Student Housing Business

Michael Levitt, chairman and CEO of The Michaels Organization, named Joe Coyle, president of our student housing company his Teammate of the Year for 2015. The recognition acknowledges the tremendous achievements Joe and his team at University Student Living have accomplished this past year. Within five years of joining The Michaels Organization and launching USL, Joe Coyle has grown the company to a national leader in student housing development. During this time, USL has completed eight projects, has 6 projects under construction and are ready to begin construction of two more. In 2015, the company also made a profit for the first time, including the largest profit The Michaels Organization has ever made on a single project, with its sale of the Axiom Apartments in Cambridge, Mass. Congratulations Joe Coyle and everyone at USL!

During this 4 ½ period they have completed 8 projects, have under construction 6 projects , and 2 more are ready to begin construction, for a total of 8,600 units at a cost of $740,000,000. In 2015, they delivered the Axiom in Cambridge, Mass, a 115-unit market-rate community with an affordable component, which they then sold for $63,000,000. This was their very first sale! They also completed and opened three new student living communities, the Radius in Minneapolis, Wahu in Minneapolis, and River Edge in Boise. They have 4 projects under construction: Commonwealth Ave. in Cambridge Mass, with a pending master lease from Boston University – the next in Pensacola, 2091 North in Buffalo, and both student housing and an on-campus housing community at Rowan University that comes with a $4,000,000 development fee. USL is ready to close another project in Minneapolis and one more in Rochester. They have also launched their very own management company, University Student Living Management, LLC. Best of all, USL made its first profit in 2015.

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erle was mson Memorial mmit. “He was on in the tional things he Meremianin, nt for The at Fort ud that Rick is gious award.

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Stephanie Martin, Housing Specialist at Fort Huachuca is now an Accredited Residential Manager. She earned her ARM® in six weeks with a 40 hour course and by passing two challenging exams. Way to go Stephanie!

The Trophy Team

Senior Facilities Director Rick Sperle was awarded the first annual Bob Samson Memorial Award at the 2015 Achievers Summit. According to Walter Meremianin, Director Learning & Development for The Michaels Organization “He was selected because of his ____________________________________ participation, in the groups, his insight and the inspirational things he said to the entire group.” The team at Fort Vista in beth Warren, Office Administrator at Mounta Comm Huachuca could not be more proud unities that Rick is the inaugural winner of this Stephanie Martin, meaningful award. Congrats Rick! Housing Specialist at Fort Huachuca is now an Accredited Residential Manager. She earned her Wedded Bliss... ARM® in six weeks with a 40 hour course Elizabeth Warren, Office Administrator at and by passing two challenging exams.Mountain Vista Communities celebrated Way to go Stephanie! her 28th wedding anniversary!

____________________________________

zabeth Warren, Office Administrator at Mountain Vista Comm unities

Elizabeth War

Way to go Stephanie!

Stephanie Martin, Housing Specialist at Fort Huachuca is now an Accredited Residential Manager. She earned her ARM® in six weeks with a 40 hour course and by passing two challenging exams. Way to go Stephanie!

Ft. Huachuca Celebrates High Occupancy Rate

Mountain Vista Communities ended 2015 with 94% occupancy – 1,034 occupied homes! In August, MVC had only 974 occupants or 86%, the lowest month since privatization at Fort Huachuca in April 2009. The success of increasing 8 percent overall in just 4 months was not an easy feat. The MVC Make Ready Team worked diligently for this success, turning 189 homes when only 136 were budgeted for that short amount of time. Collaboration with the Sergeants Major at Huachuca to have Sponsors email incoming soldiers a welcome packet on behalf of Mountain Vista Communities and the support of Major General Berrier, the Installation Commander, also helped to vamp up interest in on-post living with soldiers. MVC had success in opening the ‘occupancy waterfall’ to Single Soldiers but unlike many other military installations, has managed to keep the tier for Retirees from opening up. The New Year is off to a great start with a projected occupancy of 98%, 1050 occupied homes by the end of January!

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Ainger Place Wins Gap Funding Award Ainger Place, a new affordable housing community to be developed in Washington, DC by Michaels Development Company and its non-profit partner the Ainger Place Development Corporation, has been awarded $9.5 million from the city’s Housing Production Trust Fund. The award provides gap financing for the 72-unit community, which will offer families in the Randle Heights neighborhood of Southeast DC, one-, two-, and three-bedroom apartments affordable to those earning less than 50 percent of the area’s median income, including eight units reserved as permanent supportive housing for women at risk of homelessness. The award provides significant soft funding for the $23.4 million

development, which is being financed as a tax exempt bond transaction with 4 percent Low Income Housing Tax

Credits. The Mayor of D.C., Muriel Bowser, announced the awards at a press event held on January 29.

MDC Achieves Financial Closing on Three Boulder Properties The Michaels Development Company along with two Colorado-based partners, Element Properties and Allison Management, has achieved a financial closing on three Boulder communities that we acquired in order to rehabilitate and preserve them for long-term affordability. The $63 million deal for The Osage Apartments, Thunderbird Apartments,and The Nest apartments, represent the first time The Michaels Development Company will develop communities in Colorado. All three communities are being managed by Interstate Realty Management Company and the low-income housing tax credits are being syndicated by Riverside Capital. Construction began in January with The Nest, and will be completed in phases over the course of 2016.

On a Winning Streak in Hawaii

Congratulations to our teammates in Hawaii: East Kapolei Phase 1 has been awarded 4% LIHTC, tax-exempt bonds and Rental Housing Trust Funds from HHFDC. This latest award is the third project in Hawaii to be awarded tax credits in 2015.

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{ Fyi

Meet IRM’s Senior Internal Auditor Janet de Simone

Starting with this issue of [email protected], we are pleased to introduce a recurring column written by Janet De Simone, Interstate Realty ManJanet DeSimone agement’s Senior Internal Auditor. She will present the basics of what is involved in preparing for an internal audit, including why they are conducted, how IRM staff can prepare, and the schedule of upcoming audits for IRM properties.

What is the main function of the Internal Audit Department? The main function of the internal audit department is twofold: 1) To support The Michaels Organization’s Mission “To create high-quality and well-managed housing that enhances the lives of our residents and enriches communities;” and, 2) To act as a liaison in support of senior management’s goal to achieve compliance at the operational and financial levels through use of IRM and external regulator policies and procedures.

Tell us a little about your background? I graduated summa cum laude with an Accounting Major from Rutgers School of Business in Camden. Before coming to IRM, I worked as a tax accountant and as an external auditor before joining the Federal Reserve Bank of Philadelphia as an internal auditor performing highly sensitive audits, and operational, financial, and compliance audits.

What do you enjoy most

about being IRM’s senior internal auditor? I enjoy meeting and working with the site staff to ensure they are comfortable with their knowledge and empower them to recognize the internal audit process as a positive means to running an efficient site.

Are there also external audits? To date, neither The Michaels Organization nor IRM have performed external audits. An example of an external audit would be performing an audit of Better Tomorrows, since it is an organization outside TMO and IRM.

What is the purpose of performing an Internal Audit? Per the Institute of Internal Auditors, overall the role of internal audit is to provide independent assurance that an organization’s risk management, governance, and internal control processes are operating effectively. Basically, an internal audit is designed to add value and improve an organization’s operations. At the site level, the internal audit determines if the property is being managed effectively in operational, financial, and compliance areas and where the property would be most vulnerable to risk. Some examples of risk areas would be excessive vacancies, delinquent recertifications, and high outstanding account receivable balances.

How are Sites selected for an Internal Audit? An audit schedule is produced annually and updated throughout the year. The audit schedule is based upon various risk factors for each site such as re-certifications, voucher reconciliation

balances, accounts receivable status, and other risk areas.

How will I know my Site has been selected for an Internal Audit? The Internal audit department will send out an announcement email to the Vice President, Property Manager, and Site Manager in advance of the audit engagement.

Will the timeframe of my Site audit be up for discussion? Yes absolutely. Once you receive the email internal audit will call the Property Manager to discuss if the audit engagement needs to be re-scheduled to another date.

What happens once my site is selected for the internal audit? Internal audit will host an informal meeting and send you the agenda in advance. The meeting is a collaborative effort for both internal audit and site management and staff to work together, and to share and exchange information. It is also an opportunity for management to share any concerns or challenges evolving at the site.

How do I prepare for the audit engagement? The Meeting Agenda will be the pre-cursor toward preparing for the audit engagement. Prior to Fieldwork, Internal audit will communicate with the site frequently and review all audit areas in detail. For example, the site will receive a selection of tenant files to pull for the new move-in and recertification reviews, work orders and utility chargebacks, and other site functions.

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Michaels First Corporate Service Event Helps Camden’s Neediest For the past several years, University Student Living’s Executive Assistant, Barbara Hansen, has delivered food and clothing to the area’s homeless as a charitable activity with her children over the holidays. This year, when she asked whether any teammates would like to help with donations, John O’Donnell—inspired by her vision and generosity— asked Barb if we could turn her individual charitable efforts into a corporate service event directed at Camden, where many families are in need. Michaels is part of a huge redevelopment in Camden and John wanted the city to know that Michaels is not only a great developer but also good neighbors and corporate citizens. Thus, Michaels first-ever service event got underway, working with a coalition of non-profit agencies that help serve vulnerable families, specifically the homeless, in the city of Camden.

and hygiene products. Dolly Dube, Prestige Building Company’s Executive Assistant, arranged to have 300 breakfast sandwiches donated that our volunteers served during the Point in Time service event held at St. Joseph’s House in Camden. In all, The Michaels Organization was able to contribute 1,200 sandwiches and 300 hot breakfasts, 300 goodie bags and entire U-Haul filled with clothing, gloves, hats, and blankets. Thank you to all who volunteered, contributed, and supported this effort. As John O’Donnell, President of The Michaels Organization said, “thanks for demonstrating what makes The Michaels Organization The Michaels Organization.”

Camden was preparing for the National Day in Time Count, a federal mandate cities across the country must comply with to attempt to count people without adequate shelter in their communities, in order to receive federal funding for support services. As part of this effort, The Michaels Organization collected new and gently used clothing, mittens, coats, hats, gloves, and blankets, as well as financial contributions from our corporate staff—and teammates across the country. During a full week in January, volunteers from all our companies spent hours sorting the donations, packing them up, making sandwiches, and filling goodie bags with healthy snacks

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Annual Toy Drive Helps More than a Hundred Families Thank you to all our teammates who adopted a family during Michaels’ annual Holiday Toy Drive for our residents, and to all the “elfs” who spent time sorting, wrapping and shipping gifts!

Resident’s Hobby at Diamond Ranch Turns into Charitable Activity By Elizabeth Sanches, Activity Director, Diamond Terrace

Vira Olson, a Resident of Diamond Terrace Retirement Community in Clayton, CA, has been a very busy lady. Originally from Brooklyn, Vira understands the biting-cold that winter can bring. That, mixed with her genuine love of crocheting and caring nature, has led to a very productive hobby. Vira crochets caps to keep herself busy, sometimes creating upwards of two to three per day. For years Diamond Terrace has received donations of yarn, and before Vira moved in, had half a dozen bins full of all different colors of the beautiful material. Now the yarn’s been put to good use, but what to do with all the caps? After giving one to each of the staff members, she still had many left over and wanted them put to good use. The friendly staff at Diamond Terrace was now on the search for a worthy cause that would happily accept the donation of beautiful hand-crafted caps.

receive many donations for the infants, but it’s the adult family members who are often forgotten,” Patti told Vira that the caps would be a wonderful addition to the baskets and truly appreciated for the families in need. The Bay Area Crisis Nursery’s mission is to prevent the abuse and neglect of children by providing support to the families who are in stress or crisis. Their primary service is providing a warm, loving, homelike environment for children from birth through eleven years of age by offering 24-hour residential care. This service is free, confidential, and voluntary. They also provide a Respite Care Program which is designed to be an ongoing support to families after the immediate

crisis. It consists of planned pre-arranged two to four day stays. This service plays an important role in improving family coping patterns and reducing the risks of child abuse. The BACN has been in operation for 32 years, receives 1,000+ admissions annually, and is 100% non-profit, with no government funding. They are “for parents who care but temporarily can’t cope.” If you would like to learn more, visit their website, www.bacn. info, or call them at (925) 685-8052. Now Vira can continue to keep herself busy, crocheting away, knowing that each one of her caps is going to a good-home, for someone who truly needs it.

Then one day, Patti Kennedy, from the Bay Area Crisis Nursery came into Diamond Terrace to have lunch with a friend. She was told about Vira and her caps, and was ecstatic to accept the donation of over 50 adult-sized caps for their Christmas baskets that are given to the BACN families. “We

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{ Kudos

Janie’s Garden Phase 3 Wins Florida Safety Award Congratulations to Janie’s Garden Phase 3 construction manager VP Steven Yeary, and the rest of the crew there for their recent recognition from the state of Florida for maintaining a safe workplace/site. The Sunshine State Safety Recognition Award commends managers and employees for their demonstrated commitment to continuously improve the effectiveness of their company’s workplace safety and health management system.

Michaels’ Rowan Project Earns Infrastructure Award The Michaels Organization’s student housing development at Rowan University has been named a winner of the New Jersey Alliance for Action Award for Leading Infrastructure Projects. The award program recognizes the people and organizations throughout New Jersey that work together as partners to ensure the safety and efficiency of the state’s infrastructure.

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{ Site-ings

Diamond Terrace Spruces up its Community Room This summer, Diamond Terrace in Clayton, CA, had a grand-reopening of sorts as they unveiled their renewed community rooms. With a few slabs of paint, a little resourceful rearranging, and lots of elbow grease, the Diamond Terrace staff improved their community to the delight of residents. The Private Dining Room went from shabby to sheik; now it’s formal dining at its best. The Arts & Crafts Room was completely overhauled, from what used to feel like someone’s ill-forgotten and overwhelmed basement closet to a space that now inspires imagination and creativity. A relaxing readingnook was added to the Library and Computer Center. And an abandoned office was transformed into an energizing workout room, utilized by residents and staff alike. The unveiling was met with great fan-fare and had residents dashing from room to room to check-out the new digs. The new colors and added lighting have enhanced the warm and friendly ambience that is Diamond Terrace, giving it an open and welcoming atmosphere that impresses both guests and long-time residents alike.

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{ live, work, play, michaels

Corporate Holiday Party Fun

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{ live, work, play, michaels

Sign of Appreciation During The Michaels Organization Annual Billfish Tournament in Guatemala hosted by our Chairman and CEO Michael Levitt, participants donated funds earmarked for repairing and updating a local school there. Here schoolchildren express their appreciation.

IRM’s Stacie Brach Steps Up IRM Vice President Stacie Brach takes advantage of the fireplace hearth as she and IRM President Kimberlee Schreiber welcome teammates to one of the holiday parties held in California.

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[ “Teen Talkers” Journey To Self-Sufficiency Without knowing quite why, six girls and ten boys in separate groups meeting on different nights passed around a roll of toilet tissue. Each kid was asked to tear off off the number of sheets used in a regular bathroom visit. If you tore off, say, six, you had to tell six facts about yourself—like school attended or favorite color or an interest or fear. That ice-breaker launched teens in west-side public-housing developments on a three-month journey of self-sufficiency, which they celebrated in high style Tuesday evening. The ten sessions of discussions on self-esteem, bullying, and how to present yourself to the world were called “Teen Talks.” It involved young people living in the rebuilt Brookside and Rockview public-housing developments at the base of West Rock. Takima Robinson ran the program with volunteers Jamila Bello and Braxton Lyons. Robinson decided the culminating gathering of the first three months’ work should celebrate beauty and grooming, in keeping with the selfesteem theme. So, at Brookside’s community room, the boys and girls, who all live in the Brookside and Rockview communities

though they go to different schools, socialized and practiced what they had learned. For Robinson, the work is a crucial, and a calling. Robinson came to live in Brookside in 2012 with her three then teens. She graduated from the Housing Authority of New Haven’s (HANH) self-sufficiency program. She went on to become a homeowner in Westville and returned there as a Social Services Coordinator for Better Tomorrows, Interstate Realty Management’s non-profit partner. Robinson said that most of the kids she works with at Brookside and Rockview live in single parent, female-led households. That means many of the boys miss one rite of passage to adulthood: when dad stands behind his son and shows him the intracacies of the Windsor. Will Jackson, a 12-year-old at Elm City Middle School, knew how to tie his practice tie with alacrity. His mom had taught him. Will said the conversations in Teen Talks helped him to motivate himself and stay focused, especially under pressure. For him, that pressure expressed itself most seriously in people trashtalking at him on the court when he plays for his Elm City Middle School basketball team. After he missed a first free throw at a recent game, a kid said to him, “You suck, and you can’t shoot a foul shot.” Will said he ignored the talk, didn’t let it bother him. And he sank the second free throw. Just before Will stepped down from Robert Adams’ barber chair improvised in the community room for the party, Diamond Faison took a look and pronounced the result “fresh.” Diamond said she learned during the ten sessions sometimes to

be wary of what friends might lure you into: “Don’t let people, even your close friends, fool you. Like saying, ‘Oh come on, just come on over and smoke.’” Jaylon Lloyd, a 12-year-old who attends Wintergereen Interdistrict Magnet School, said he learned a simple lesson, which applied Tuesday night: say hello to people when you walk into a room. He said hello to Brenda Ward, secretary of the Interstate Realty Management (IRM) company, which manages Brookside and Rockview under a contract with the housing authority. Robinson said she organized the groups with lessons and exercises— like that toilet tissue icebreaker— based on what she learned raising her three kids. Teen Talks will continue. The next unit will focus on sexuality, pregnancy prevention, dating, and hygiene. The third unit will cover drug prevention. Each unit lasts three months, with a culminating event like the celebration of beauty and grooming.

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{ Farewell

The Michaels Organization, Better Tomorrows Mourn Loss of Hattie Stroud The Michaels Organization and our nonprofit partner Better Tomorrows is mourning the loss of our good friend and valued colleague, Hattie Stroud, the long-term social services coordinator for Jackie’s Garden in North Philadelphia. Hattie passed away January 6 while in Boston visiting family. Hattie joined Interstate Realty Management in January 2001 as the social services coordinator for what at the time was called Montgomery Townhouses. She transferred to Better Tomorrows when the organization was founded in 2013.

where HUD’s first Neighborhood Networks Center was established and where the programs for children are especially top-rate. The community was renamed in honor of IRM’s founding Director of Social Services, Jackie Jones, a few years ago in a ceremony attended by city and federal officials. Hattie was a driving force for many activities on the site, including the Jackie Jones’ cycling team, the annual IRM spelling bee, afterschool tutoring, the community garden and health and wellness programs for seniors. She always had a smile on her face and was a mentor to many young social services coordinators during her

All who know the community of Jackie’s Garden know that it has been for years a showcase property for The Michaels Organization. Known as an “oasis in the city,” Jackie’s Garden houses families with low incomes and is known for the rich slate of social service programs offered there as well as for how beautifully has been maintained for more than 30 years. It is often on property tours when Michaels Development or IRM are involved in proposals for new deals.

time at both IRM and Better Tomorrows. She was actively involved with the leadership team when the work of forming a non-profit dedicated to supportive services was being accomplished. Hattie was the loving mother of seven children and the devoted grandmother of 9 grandchildren and 10 great-grandchildren. She was also a woman of deep and abiding faith, and was an ordained minister who served her church and the community at large. All of us at The Michaels Organization and Better Tomorrows offer our heartfelt condolences to Hattie’s husband Frederick Stroud and to all her family and many friends. She will be greatly missed.

Jackie’s Garden is the community

The Michaels Organization family is sad to announce the loss of Pete Wikarczuk, who served as the Maintenance Superintendent of Ascension Manor I and II in North Philadelphia for more than 47 years. Pete died suddenly on December 24. He was 62.

He was beloved by both residents and teammates at Ascension Manor. We offer our sincerest condolences to his wife Terri and the rest of Pete’s family. He will be greatly missed.

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