Over lunch one day in April, a retired friend of mine posed a question: Can you imagine trying to do business during a pandemic without the use of technology? Without the most basic of things, like the Internet — or, for that matter, even computers?
I had to admit, it was hard to envision. How would my real estate investment firm, MZ Capital Partners, which specializes in multifamily assets, operate during COVID-19 without the most basic tech? I can’t even begin to imagine how difficult that would have been, and how we would have gotten through without it.
Or maybe I can, to a certain extent. I’ve been a licensed real estate broker since 1979, so I can remember the pre-email days, when it was all about long phone calls and slow mail delivery. So certainly, I can appreciate the manner in which technology has not only brought our industry through this crisis, but also how it revolutionized real estate, well before the pandemic.
I say this while at the same time acknowledging the fact that the industry is not known for its quick embrace of change. As Karen Hollinger, senior vice president of corporate initiatives at Virginia-based AvalonBay Communities, said at the National Multifamily Housing Council annual meeting in January 2020: “Technology used to be a necessary evil 10 years ago. Now, you can’t perform without tech.”
It’s a matter of evolving. It’s a matter of surviving. It’s a matter of understanding what the future might hold. Much has been made, for instance, about resident-friendly tech. About virtual tours and spiffy company websites and portals that enable tenants to sign leases, pay rent and arrange service calls. About keyless entry and high-speed internet connections and smart devices like thermostats, lights, blinds, etc.
All of that has come into vogue in an attempt to meet residents’ expectations. Ninety-two percent of them use the internet, after all. Fully half of them use a mobile website or app in searching for a place to live. As a result, it is incumbent upon all of us in the multifamily sector to learn and grow.
But let us focus for a moment on the impact tech has made internally. I find that it has fallen into one of two buckets — acquisitions or operations.
When we’re doing our due diligence on a property, for instance, we can log into Google Maps to take a virtual tour of the surrounding area. Obviously we will still have to get on a plane and go there to get a true feel for the neighborhood and the property itself, but we can at least gain some understanding of what we’re getting into.
In addition, we can access various public databases to get an idea of selling prices, tax rates, assessments, etc. We can use websites like Apartments.com to check out current rental rates in a particular market, or of properties that are in close proximity to the one we’re considering.
Specific to the pandemic, there has been the increased usage of video conferencing platforms, especially Zoom. While I will admit that I am among those suffering from Zoom fatigue, I have to say that I find the platform appealing when it comes to the various meetings and hearings someone in my shoes must attend, when we’re developing a new property.
For any given project, there is, at a minimum, a preliminary meeting, a meeting with a planning commission and a meeting with a city council. With Zoom, each of those is a 20-minute process from the comfort of my office, or home office, as opposed to spending the better part of two days traveling to and from a place. I wouldn’t mind seeing that continue after the pandemic.
Operationally, it wasn’t all that long ago that we would regularly visit one of our properties to meet with the on-site management team and review the progress on matters like leasing, traffic and rental rates.
Those meetings are still valuable, but with the property-management systems we have in place, we have access to all the information we need, in real time, at every property — exactly how many move-outs there are, exactly what the latest lease rate is, exactly how many people toured the place.
Again, looking at the pandemic, most of the support staff and bookkeeping staff in our corporate office in Northbrook, Illinois, has been working remotely since the outbreak began, and that will likely remain the case for a few days a week afterward. Most of the information is in the cloud, anyway, and can easily be accessed and shared.
In short, technology has made our company, like many others, more cost-efficient and time-efficient. It has made it easier for us to maintain a wide footprint, to tend to our properties in such places as Tennessee and Texas.
Certainly, other tech developments lie ahead, but in general, it can be said that innovation has enabled those of us in the multifamily space to do our jobs better — and that was the case well before the pandemic.
Michael H. Zaransky is the founder and managing principal of MZ Capital Partners. Founded in 2005, MZ Capital Partners, based in Northbrook, Ill., deals in multifamily properties.