Technology breakthroughs now occur nonstop, for operations and management tasks, community activities and in-unit living. But to keep a building humming smoothly and attracting residents, a proptech decision must be made to retain a competitive edge.
Technology has become the latest and one of the most important rental housing amenities as software and hardware are added that both residents and staff find useful to save time, energy, money and reduce angst. Fewer rent checks may be lost in the mail as the adoption of online payments continues. Few door keys need replacement when an app provides entry.
But technology has long been a part of multifamily living. As far back as 1913, refrigerators for the home were invented, followed two years later by electric clothes dryers, and then in 1924 modern dishwasher models, according to Coldwell Banker Real Estate.
The difference now may be that many more advancements get introduced in rapid-fire succession to cover so many more facets related to apartment operations and living. “Every day there’s a shiny new toy that comes out,” says Claire Hansen, Director of Development, RangeWater Real Estate, which has approximately 36,000 units in 122 projects across the Sun Belt and Mountain West. But not everything that dazzles is worth the time and expense. Companies like RangeWater approach introductions cautiously. “We wonder will it be around, what kind of value will it offer residents and investors, and how will it fit within our technology portfolio? We want to stay as updated as possible, which is why we have internal tech teams and third-party consultants to help,” Hansen says.
Technology brings other challenges. How quickly will apps, software and hardware need to be tweaked or replaced to keep pace with competitors’ newer systems? Or will the latest iteration help a company save more money in labor and energy costs, time due to greater
efficiencies and wow power to woo residents who’ve come to expect the most robust Wi-Fi and cable bandwidths?
Some companies like RMK Management Corp., which oversees approximately 8,100 units at 36 properties in four states in the Midwest, say there’s a wide range regarding when something becomes obsolete. “It can be as soon as six months or much further out, and with so many new products to consider it can seem like a full-time job to keep up with advancements,” says Diana Pittro, Executive Vice President.
In most cases, obsolescence depends on a specific category since software and security systems generally require updates or replacements every few years to be sure they meet current standards and threats while hardware like an HVAC system has a longer operational lifespan, says KrisAnn Baker Kizer, Vice President of Leasing and Marketing with Pierce
Education Properties, developer of 7,558 purpose-built student housing (PBSH) units in seven states. On the shorter shelf-life timetable are key fobs, which age out and need to be switched much sooner—sometimes in a matter of five or so years, she says.
Because of the knowledge that technology inevitably changes, commercial interior design firm Mary Cook Associates (MCA) wants its multifamily apartment clients to focus on choosing tech systems that are flexible so they can be easily adapted. “There’s a fear of planning for the wrong technology. Most ownership is knowledgeable and tries to account for 80 percent of possible scenarios, but nobody can cover all,” says Joshua Kassing, Senior Vice President. “We try to avoid putting in something that may become obsolete two months later, but we haven’t resolved how to prevent that since technology keeps evolving. One help is to start by intentionally designing for evolving technology, which seems to offer the most promising investment,” he says.
The good news is that as technology features become more omnipresent, more companies have entered the market to offer more products and packages. “There used to be one or two key vendors in this space and now there are at least 20 major players,” Kassing says.
And that brings the challenge of deciding whose products to choose. Laura Rodriguez, Senior Vice President, RKW Residential, which oversees 35,000 units under management and consulting with 985 active properties in eight states, says her firm is constantly bombarded with new possibilities. Its solution is to look quarterly at what’s new but not make quick changes to pare costs or bring disruption to units and amenities. “We try to make them seamlessly behind the scenes. For example, nobody knows if we’re upgrading Wi-Fi,” she says.
How other companies introduce, update and change their technology choices varies. Kassing says his company sits down early in the development process with management, ownership, an operations team and maybe a third-party tech provider to go over a building’s entire space and determine what’s needed, whether it’s in a club room bar, mail and package rooms, gym, lobby, garage or residential units. “We talk about what’s of value and how tech can enhance each,” he says.
Hansen says her company looks at what competitors have chosen, as well as what’s new every year or two and tests out a few options rather than undertake big overhauls that would require a long period to implement. “If any pass our tests, we roll them out to a few properties and then hope for synergy across the board,” she says.
Cruz Management, which manages 1,200 units at 21 communities in Massachusetts and Maryland, seeks input from its management team since they’re responsible for how well all technology and processes will work once installed, says Justin Cruz, Director of Cruz Management and COO of Cruz Companies.
Due to different demographics and types of buildings, more companies are taking an individualized approach, even within their portfolio. “Everything’s very property specific, and something we carefully decide before we roll out a stack of technology for a new community,” says Leslie Mathis, Director of Asset Management, Woodfield Development, which has 6,000 units at 17 properties in six states. “What’s important is to have the infrastructure in place for future changes since once technology is added, it’s hard to go back and make certain changes. We try to use the history of what’s happened before in our buildings to guide us on future projects,” she says.
More companies are also eying or starting to incorporate artificial intelligence (AI) as they come to understand how it can help to meet needs such as more detailed responses to questions posed in chatbots on company websites rather than just a “yes” or “no,” says Mathis. “It can be used to reduce delinquent rent,” says Rodriguez.
For now, tech features and updates are focused primarily on the following:
Building systems and features are run and checked more by high-tech sensors, whether it’s the HVAC, air conditioners, sprinklers, and even toilets, says Cruz. When RMK Management adds a new property to its portfolio, it assesses wiring and current connections and updates software and equipment to keep it working well. Companies can also add tech solutions to improve air quality in communities to eliminate bacteria, mold and pollutants.
Lighting technology changes have been slower to emerge even with the availability of LEDs—now widely in place with the ability to be paired with a timer and a mobile app. “Automated controls have become longer lasting and sometimes may be controlled by residents, concierge or motion sensors,” says Kassing, whose company keeps its eye on what’s happening to adjust or tweak these systems every few years since doing so is critical for resident and staff safety, each space’s ambience and energy efficiency and cost.
Leasing a unit has also changed thanks to technology with some leasing managers working off mobile devices rather than sitting with a resident and others using a computer in their office. Kassing and his colleagues have found that they first inquire about how a manager will operate, and then make a tech choice to support it rather than work the other way around. But even before a potential resident signs a lease, technology kicks in with the big ramp up seen since the pandemic started offering better options for potential residents to tour on their own using a code to get into a building and a unit or view it virtually, Hansen says. Mathis agrees, “Our first self-guided tours weren’t a good fit since everything was compressed to get out the technology. We’ve switched to better systems,” she says. For many companies, leasing and marketing technology are updated annually because it’s one of the more affordable changes, Pittro says.
Entering a unit has been simplified with new technology that eliminates keys and fobs so no need to worry about losing and replacing them. Residents now manage the process from their phones. But implementing the change has become a big cost commitment. “If you’re switching over 300 units to a system... you commit to not changing it again in a year,” Kassing says. Pittro agrees, “Generally, there’s a five-to-seven-year window for replacing locks and door systems since they’re expensive and needed for so many units,” she says. Systems may also be proprietary, which requires time to replace or repair them. And in older buildings, change may involve bandwidth and wiring, which are expensive. “It’s a bit different in PBSH because the demographic is more tech savvy and often classes and apartments must have compatible systems that speak the same language,” Kassing says. But when it comes to a building’s main entry doors, those may be changed sooner, he says.
A building app is more common to download to manage needs from a single hub, such as pay monthly rent to schedule repairs, control temperature, learn about community-wide activities and even communicate with fellow residents, says Hansen. One of the newer tech features added allows residents to sign out for items from an online inventory stored in a room onsite so residents don’t have to buy everything they may not use frequently such as a beach umbrella, yoga mat, weights or a computer printer, says Kassing. “It’s the tech version of a vending machine and a true asset to the amenity package of a community building.” Most buildings try to keep options to a single app for easier engagement and updates, Mathis says. The importance of the building app is indicated by the fact that 70% of residents engage with such systems on a recurring basis, Rodriguez says.
Package room technology took off more with the increase in online shopping that began during the pandemic. Fewer buildings now staff package rooms. Instead, residents are likely to receive notifications on their building app that a package has arrived, and a code pops up to enter a locked package room where the newest iteration is a light that directs them to a specific shelf where the item is held, says Mathis. Cameras monitor such locations, Hansen says.
Other amenity spaces that have become higher tech are workout rooms, pools, locker rooms, laundry rooms and business offices, all of which may require a code to enter to control security and use of any equipment, Hansen says. More buildings with shared laundry rooms use technology so residents can avoid needing coins to operate them, says Cruz. And some buildings are installing minimarts with vending machines or equivalent.
As systems get hacked, technology is protecting them with better firewalls managed through tech, Cruz says. “Cyber security requires constant upgrading, sometimes a three-year window,” he says.
Tech package options are growing for residents who want more than basic technology and are willing to pay as well as for management to gain another revenue stream. “Management may offer a tech package for $150 or so monthly to opt into and upgrade light switches to smart devices that [a] voice activation system may control to dim lights for dinner or allow piano music to play while they’re cooking or dining,” Kassing says.
There’s No Replacing the Human Touch
Just as the paperless office never materialized, the employee-less apartment building isn’t expected any time soon, if at all, despite the focus on high tech, says Rodriguez and others. None are eliminating face-to-face contact. The reason, says Mathis, is that “we’re providing homes for people and their needs, which requires a personal touch.” Cruz agrees, “This is still a very person-oriented business. Many know that residents still prefer a live voice rather than a chatbot reply, even if the bot is programmed to sound almost human. And some services still function better by voice such as service requests that can be more fully described live.”
Barbara Ballinger is a frequent contributor to units.