Like a scene from the Jetsons cartoon: Instead of calling a rental office and making an appointment to walk through the rooms of a potential apartment, renters are increasingly communicating with bots and call centers to find their next abode.
The humanless-contact transactions that have defined the COVID-19 pandemic have converged with worker shortages and young renters who grew up with smartphones in their cribs to accelerate this trend of staffless apartment complexes.
Highland Ranch, Colorado-based UDR, one of the early pioneers, completed the rollout of the first phase of a new operating platform across all of its markets in 2021. The REIT's self-service model had allowed it to reduce headcount at its properties by 40% and increase customer satisfaction scores by 24%, Michael Lacy, senior vice president of property operations, told stock analysts on the company's fourth-quarter earnings call last month.
Now, UDR is readying the second version of that platform to reduce the number of days apartments are empty, leverage resident and prospect data, encourage prospects to sign leases, control expenses and drive rent increases through its centralized sales teams.
UDR didn't respond to Multifamily Dive's request for comment.
The human touch still matters
To be sure, there are plenty of companies that are ardent believers in the human touch.
"I always try to compare ourselves with a Ritz-Carlton or high-end department stores," said Marcie Williams, president of Charlotte-based apartment management firm RKW Residential. "You don't expect to go in and pay high rents and no one is there to take care of you."
And there are plenty of renters who want to see apartments, sign leases and schedule repairs with a firm handshake.
Tim Connon, 30, relied on online 3D visualizations to pick an apartment when he moved to Nashville in 2019. Although the process was seamless and the founder of ParamountQuote Insurance Advisors was happy with his selection, he would have still preferred meeting a flesh-and-blood leasing agent.
"From now on, I would always try to be in person and be able to see in person," Connon said. "It's way too much anxiety that comes with doing all of it all online."
But two years into the pandemic, it's hard to find workers to staff properties, and many apartment managers are centralizing operations, hoping to cut costs and increase resident satisfaction.
Pegasus Residential, a property management firm, is testing three staffing models – a five-day workweek, a four-day workweek and a centralized staffing platform – at its communities in an attempt to right-size operations for the future and move its employees away from working on weekends. In each case, the company is leveraging self-guided tours and virtual interactions. In the centralized model, the manager and assistant managers will move offsite and support multiple properties.
"The folks that we have on site are managing relationships for current residents and prospects and reenvisioning how we interact with our prospects, the community that we build and the programs that we have," said Yakov Belousov, executive director of operations for Pegasus, based in Alpharetta, Georgia.
With maintenance, Pegasus will rely on a "hub-and-spoke" system with a technician devoted to a property, while everyone else will be in a centralized pool.
"We have case studies that show you are not losing any revenue, you are not missing out on leases, your occupancy is not dipping and your rent growth is exactly where it was before," Belousov said. "Just because you're closing on the weekend, it's not hurting your business."
An experiment in Maryland
AvalonBay Communities has gone a step further. The Arlington, Virginia-based REIT piloted a program with no staffers on site at its 238-unit Kanso Twinbrook (pictured above) in Rockville, Maryland. Prospects can use self or virtual tours to see apartments and residents can schedule maintenance requests. The REIT provides emergency response as needed.
Before the property opened, AvalonBay set up a process to automate or manage all of the daily tasks in the office. But it found that there were other duties, such as one-off inspections and utility coordination, that its teams performed in addition to these responsibilities.
So far, resident reaction has been positive, said Karen Hollinger, senior vice president, strategic initiatives at AvalonBay.
"This community serves a customer who values an affordable, modern, large apartment over amenities and an on-site leasing team," Hollinger said via email. "Our digital tools enable our customers to handle leasing transactions on their time and our customer care center provides expanded coverage hours for any other support needs, far beyond the typical leasing office hours."
AvalonBay is now considering introducing properties without staff in other smaller, simpler communities in suburban, transit-oriented areas close to major cities.
But not all of them. AvalonBay's 400-unit high-rise in New York City would be challenging to operate without a concierge or leasing presence.
"I certainly cannot imagine every building in every geography with this brand and customer needs and demographics differ," Hollinger said.
Help needed on new apartments
Newly built properties will also still need a heavy on-site presence, said Steve Hallsey, executive vice president of operations for Atlanta-based Wood Residential Services, the management arm of large developer Wood Partners.
"On lease-ups, it is still very, very intense," Hallsey said. "People want to see the product. There are not a lot of ratings and reviews on the website. So you want to kick the tires and understand what you're getting into."
But for stable properties, human interaction may be less necessary. Hallsey predicts that virtual and self-guided tours will be more accepted over time.
"The leasing agent position is not going extinct," he said, "but it will be highly reduced over time."
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