When Dan Laufer thinks about the future of leasing and living in an apartment, a single, summary phrase comes to mind.
“More remote decision making,” says Laufer, CEO and co-founder of the San Francisco–based apartment ratings and search app RentLingo. “Things like virtual reality, location intelligence, direct booking, and flexible lease lengths will become more common.”
Indeed, you can find location intelligence on listings in RentLingo’s Charm Index, which uses big data to tell you exactly how cute, hip, or blasé a neighborhood and property are, with information about the proximity of chain stores and franchises versus one-off boutiques and eateries. Then, there’s RentLingo’s Noise Index, which will disclose a noisy highway, passing streetcar, or elevated train before you find out about it at 3 a.m. the day after you move in.
Those aspects, as well as reviews from former property managers that RentLingo pays to mystery-shop units, help set the app apart.
“It's clear that location matters to renters, but there are aspects of location that photos or descriptions can't fully capture,” Laufer says. “More transparency on location quality has had a big impact on the lead-conversion rate on our site.”
But Laufer’s observation about remote decision making doesn’t apply only to RentLingo’s indexes, or to how those indexes enable prospective residents to get a sense of place without actually visiting a property. Laufer’s comment also highlights a broader aspect of the technology we’re likely to see in multifamily’s next-generation apartment: namely, that while apartments are real estate, and real estate is all about location, the apartments of the future will leverage unique aspects and services remote to that location.
That might translate into a prospect sitting 3,000 miles away from her future apartment while taking a real-time, virtual tour of it, or a resident lounging in his current apartment’s living room and summoning an on-demand self-storage vendor to show up at his door within the hour.
All in all, it means that the defining aspects of real estate—the uniqueness of each location and its sensory feel, as well as the inherent value and inevitable limitations those physical characteristics create—are about to be blown wide open. In fact, in some places, they already have been. Take, for example, the use of virtual tours to lease an apartment today.
“It’s astonishing how many renters select their units today without seeing the actual property,” says Alo Mukerji, vice president of product for Boston-based property management cloud software firm Buildium. “Whether it’s because they’re moving across the country, travel regularly for work, or they simply live in a rental market that demands quick action, that’s what’s happening. With virtual reality and video tours, prospective renters have the ability to view the apartment, common areas, and more without having to step inside the building.”
For Tom Bretz, co-founder of the Chicago-based Elmspring Accelerator, which incubates tech start-ups focused on real estate, next-generation apps generally fall into three categories: those that deliver content via video or virtually; those that provide services to residents; and those that help residents connect with each other or the buildings they live in.
“There are a variety of categories in play right now,” Bretz says.
Maxwell Peek, executive vice president for new business initiatives at Chicago-based Waterton Associates, an operating partner of Elmspring’s, says those multifamily-focused tech categories are expanding now due to a new generation of entrepreneurs who suddenly have real estate in their sights.
“There are a number of young entrepreneurial people who have identified real estate as an industry that’s ripe for disruption,” says Peek, who also sits on Elmspring’s board. “They don’t necessarily have a real estate background, but they’ve been in other industries and recognize the opportunities that are present in real estate today. We’re seeing a ton of intriguing ideas focused on either improving the apartment product from a customer-facing experience, or from an operating standpoint to assess, analyze, and improve our business.”
Here’s a rundown of the technology and apps, by category, that are quickly moving into the next-generation apartment.
Virtual Reality and Video
The technology that’s perhaps getting the most attention in multifamily is in the virtual reality (VR) and enhanced–video tour space.
At the National Apartment Association’s conference in San Francisco in June, Apartments.com set up Oculus Rift and HTC Vive virtual reality headsets to allow industry players to virtually “walk through” an apartment. The firm is currently testing the technology, shot on Matterport 3-D cameras, on select listings to let users see and feel the dimensions of remote spaces for themselves.
Other firms, such as Floorplan Revolution and Designstor, provide virtual, 3-D renderings and tours of future communities for multifamily operators. Another vendor, San Jose, Calif.–based RoOomy, supplies virtual staging technology to let renters see how their furniture will look in a given space.
“We’re definitely seeing an appetite for 3-D interactive tours and technologies from our multifamily clients, particularly as costs come into alignment with budgets,” says Lorin Horosz, vice president of marketing at San Francisco–based brokerage firm Polaris Pacific. “Whether it’s 3-D Matterport scans of physical spaces, or a virtual floor plan where prospects can navigate future spaces on line or via a VR headset, the technology solutions are readily available.”
Jerry Rodgers, vice president of software development for Apartments.com, says apartment listings with 3-D tours receive 49% more inquiries from potential residents than listings without such tours.
“These renters are well-informed [about an] apartment community before they’ve even contacted [it], eliminating those communities that don’t fit their needs,” Rodgers says. “VR has a lot of possibilities to enhance the consumer experience and make it quicker for communities to turn high-quality leads into leases.”
Observers point to other possible uses for VR as well, like connecting with online interior design firms, such as Laurel & Wolf, to experiment with different decorating motifs. Combine those uses with technologies such as multifamily savant Mike Mueller’s LeaseHawk ACE app, a Siri-like automated phone attendant for leasing, and it’s not hard to imagine a touchless move-in process in the not-too-distant future.
While virtual reality allows operators to showcase both existing and future apartments using 3-D photography or renderings, other types of video apps are enhancing virtual tours as well. Take ReaLync, a firm that was shepherded through the Elmspring incubator and offers a real-time video app that allows leasing agents to connect with prospects and give them a virtual tour using a tablet or smart phone.
“It combines all the best features of Skype, FaceTime, and a virtual reality slide show or video,” says Waterton’s Peek, who is currently beta testing the technology. “It provides our on-site teams with a nice tool to make the leasing process easier. They’re able to interact with prospects face-to-face, answer questions, and give them a live tour simultaneously.”
Yet, even as virtual reality and live tours can help prospects make a remote decision to lease an apartment before they ever step inside it, the technology will also give them an authentic view of a property, warts and all.
“Virtual reality is the closest thing to being there that you can get,” says Patricio Navarro, partner at Miami-based virtual reality firm ArX Solutions. “But that means it also shows the good, and the bad. If you have a beautiful property, virtual reality is going to help you. On the other hand, if your property doesn’t look that great, it might actually make you work a little harder, because clients will definitely be able to differentiate between the two.”
The apartment industry is awash in apps right now that are pitching themselves as electronic amenities for residents.
“They’re coming at us fast and furious,” says Nick Alicastro, vice president of business development at Irvine, Calif.–based Western National Property Management, an operator of 22,000 units. “We’re inundated, almost every day, with companies trying to pitch the latest and greatest.”
One pitch that Western National liked came from Updater, an address-updating service that allows new residents to enter their information just once and have all their various financial and subscription accounts updated. The brainchild of CEO David Greenberg, who grew frustrated with the minutia of updating his own life after a move, the app also lets residents arrange for utilities before move-in; forward mail from their old address; send out moving announcements to family and friends; and take advantage of special moving offers.
Western National showcases Updater as a way to let residents know apartment operators feel their pain during a move.
“Moving is hard; there’s a lot that goes into it, and we want to help residents through the process,” says Laura Bartz, Western National’s director of marketing. “The plan is to present it as another amenity, as something that we’re providing to make the process easier for them.”
Another tech firm making things easier is New York City–based MakeSpace and its on-demand storage app. MakeSpace allows cramped New York apartment dwellers to call on self-storage movers to come to their apartments, pack up superfluous stuff, and have it stored off-site, without having to do any of the heavy lifting. Pictures and a cataloging system allow users to then log in and request items to be brought back to them when they want.
“Tech presents infinite tools to improve a resident’s living experience, and things like Updater and MakeSpace provide great logistical support for renters when moving, which is invaluable for today’s hypermobile rental base,” says Christopher Bledsoe, co-founder of New York City–based Ollie, an operator of a fully furnished, fully equipped co-living space in the vein of the WeWork and WeLive concepts that lavishes technology on its residents. “More than anything, we’re interested in how tech improves the day-to-day user experience for our residents.”
For Ollie, that includes offering them use of Hello Alfred, a virtual butler app that will drop off residents’ groceries, water plants, pick up prescriptions, or even do a deep clean of their apartment. Ollie also provides residents a membership to Magnises, an event service and app that gets them into exclusive gatherings throughout the city, complete with VIP treatment.
Residential Peer-to-Peer Apps
But Ollie’s most anticipated app is its upcoming Bedvetter service, still in development, which will use dating site–like algorithms to match up roommates to share living spaces. “Bedvetter will connect people to form like-minded, compatible roommate situations,” Bledsoe says. Ollie then uses team productivity Slack channels to help residents connect and communicate once they move in.
A plethora of “white-label” social networking apps has also hit the apartment industry to allow residents to connect with one another, whether to coordinate community get-togethers or just share tools or other household items. At Waterton, Peek says the firm is beta testing Mobile Doorman, which not only allows residents to submit service requests in a walled garden, away from the broader Internet, but also provides a community chat function where residents and staff can communicate without the pitfalls of a public Facebook page.
Other examples of resident-to-resident apps include ParqEx, an Elmspring Accelerator company, which allows residents or owners to rent out unused parking spaces, akin to an Airbnb for empty parking spots.
What the Future Holds
All of this technology makes someone like Ollie’s Bledsoe—who, at age 35, is the epitome of an entrepreneur with other industry experience targeting the multifamily space—see unlimited opportunities ahead. Formerly a food and agribusiness analyst at Lehman Brothers who launched online education site Essay101.com from his dorm room, Bledsoe says the apartment industry is on the cusp of being transformed by the technology it’s so quickly adopting.
With just a single location in New York thus far, Bledsoe has plans to roll out Ollie’s all-inclusive living offerings—complete with an “Ollie Box” that provides everything from bath mats to tableware for new residents—in Los Angeles, Pittsburgh, and Jersey City, N.J., and sees next-generation tech as the kind of offering apartment companies will need to become themselves in the future.
“Our business model almost resembles the software-as-service model more than it does the traditional apartment rental industry,” Bledsoe says. “Rather than paying rent for a fixed geographical apartment, people will pay a monthly fee that allows them to tap into a vast network of resources across the country and, eventually, the globe.”
Sounds like the ultimate example of how remote decision making, and the technology that enables it, will transform the next-generation apartment.