By Elie Rieder, Founder & CEO, Castle Lanterra Properties
In today’s competitive market, integrating “smart” devices and high-tech building management systems is essential to attracting and retaining renters. Research shows that “smart” apartments appeal to “smart” renters regardless of age: 86 percent of Millennials surveyed by Schlage say they’re willing to pay more for an apartment equipped with automated or remotely controlled devices; and 65 percent of Baby Boomers living in apartments are also willing to pay more. The cost savings these devices offer can make them a win-win for residents and property managers alike.
Prepare with research and market analysis
One strategy is to integrate ongoing tech evaluation and installation into a value enhancement program that provides a higher standard of living for residents, while differentiating properties through thoughtful renovations and operational improvements.
The first step involves market analysis, focusing on key considerations like age, lifestyle and other characteristics of the individual property’s tenant base, as well as the kind of tech features they want. The physical makeup of the property (number of floors, unit configurations and the mechanical infrastructure) is a critical factor. After collating and analyzing the data, a cross-section of employees including property managers, finance specialists and IT staff can help determine the mix of devices that will deliver the best results for the cost.
Balance demographic and other needs
It’s important to strike a balance between the needs and desires of tech-savvy Millennials and the growing population of not-always-tech-savvy empty-nesters and Baby Boomers who choose to rent. One approach is to feature a mix of smart tools that offer residents greater ease and convenience and are more energy efficient and environmentally responsible.
Smart thermostats and lights are at the top of the list, since devices that allow managers and/or residents to carefully control heat, air and other energy-consuming appliances can save money while offering convenience. For example, the Dwelo platform helps control energy consumption and security. Remotely managing thermostats, lighting and locks throughout the complex can save tens of thousands of dollars annually in areas ranging from controlling temperature fluctuations in vacant apartments to eliminating the need to change locks or replace keys.
Smart locks are another must-have for Millennials (61 percent surveyed were likely to rent an apartment specifically because of electronic access features), and offer enhanced security for property owners. At a mixed-use complex in Denver, a property management software platform featuring a keyless smart lock system allows tenants to use a single key fob to enter selected areas, while the property manager can remotely limit access to the community’s buildings and amenities 24/7.
Monitor metrics and identify best practices
Property owners and management companies should also monitor and analyze their operations, since a comparison of before-and-after activity at each property will uncover shortfalls and help identify best practices. Off-the-shelf revenue management software enables management to track unit availability, rent comps, property traffic and other factors, and assists in structuring rents and lease terms to improve overall utilization rate/revenue of the property. It also offers improved flexibility for residents who may desire individualized lease terms.
Preparing for the future
Demographic, technological and other changes continue to present ever-changing opportunities and challenges. Real estate owners, developers and management companies that want to stay at the top of the market should remain aware of their operating environment and thoughtfully embrace technological advances to create a seamless and satisfying tenant experience.