November 18, 2020 |
Updated November 18, 2020
Amid the specter of COVID-19, a variety of technology is being applied to reduce operating costs while improving resident health and wellness.
By Stephen Ursery
The rental housing industry has rarely been accused of being quick to embrace technology, but that was beginning to change in the years prior to the onset of the COVID-19 pandemic, which is only accelerating the adoption of new solutions and services.
So said panelists during the APTvirtual session, “Technology, COVID-19 and a Return to Normalcy: What's Disrupting Residential Real Estate?”
"We're in a real moment of change," said James Scott, Lead Researcher at the MIT Real Estate Innovation Lab.
The quickening adoption of technology is the result of a confluence of several factors, Scott noted.
First, things like artificial intelligence, machine learning and AI have advanced to a point where they have real-life applications in real estate. Secondly, firms like Fifth Wall, JLL Spark and others have invested more than $10 billion in practical real estate technology during the past several years. Additionally, the pandemic has forced operators to rethink how they conduct many aspects of their businesses.
Pre-pandemic, operators typically viewed technology in terms of "how do you help serve residents, make it more convenient for them, give them an amenity they're willing to pay for," said Sean Miller, President of PointCentral. "It was really top-line revenue focused.”
Safety, efficiency and protecting assets are the main drivers of technological innovation in real estate today, according to Miller. "You're seeing people look at things like unattended showings to get people in to see vacant units, or how people get in and out of buildings with different access control systems," he said. "Even cameras for sensing how people move around and how many people are in a room to see if social distancing is being followed."
What Has Traction?
Technologies that help operators promote health and safety and that maintain building wellness will have staying power in the apartment industry, the panelists said.
For instance, operators will embrace solutions that optimize HVAC performance. They also will continue to adopt self-guided tours and technologies that promote other operational efficiencies.
"We're seeing people start to think about keyless work orders – again, touching on this idea of health and safety," Miller said. "If I've got to fix something, I can show up with a code or an app and just get to where I need to be, take care of it, and I don't have to worry about going into an office, checking out a key, touching a key."
Chatbots, cutting-edge air ventilation and air purification systems and remote payment systems for residents also are among the technologies that will be in demand, Scott said.
Creating a Technology Friendly Culture
To start, it's important for apartment executives to educate themselves, at least in general terms about the emerging technological landscape, according to Scott.
"I'm not going to say you've got to go and become a data scientist,” he said. “But what I would say is make sure you educate yourself on what these terms are within the industry so that you just feel very comfortable with all of these new systems that come in. Understand terminology like API or edge computing or big data. Really try to figure out what those things mean so that you have an idea when they come up in conversation."
Miller urged operators who are beginning to embrace new technologies to first do so in a small-scale way. "You start with bite-sized projects and work yourself forward," he said. "Then I think organizations can better understand the ROI they're generating from their investments because it's much more measurable and much more demonstratable both in the organization and to the stakeholders you have outside of the organization."
The panelists also said operators, when researching suppliers of new technologies, have to be on the lookout for more than just a vendor.
"You can't look at anyone just being a vendor anymore," said moderator Denise Froemming, CEO and Executive Vice President of the Institute of Real Estate Management (IREM). "They have to be a true partner and you both have to have the same goals in mind."
Miller echoed those sentiments. "I try always to stress to owners and operators: This space moves fast," he said. "There a lot of names that come in and out from different sides of technology – it's very sexy at times with VC money and headlines. Most operators want to make sure the technological champions in their organization do a good job of stepping back and choosing a partner and not a vendor. A vendor wants to sell you something, but a partner is going to make sure you get the ROI out of it."
Stephen Ursery is a Content Manager for LinnellTaylor Marketing.