Multifamily companies that deploy smart thermostats in common areas of their properties report energy cost savings of 18% to 20% annually and 20% to 30% reduction in energy use, according to a new white paper from Parks Associates, in partnership with SKBM SmartTech.

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Drawing on the results of 10 interviews with leading multifamily owners, operators, and management companies, the white paper highlights the benefits of understanding the return on investment (ROI) smart technology can provide in multifamily.

"It can be difficult for companies to determine the best strategies and benchmarks to measure ROI from smart building solutions, so naturally many properties are hesitant to make such large-scale investments," says Kristen Hanich, research director, Parks Associates.

"Our research and interviews show smart building technologies, when properly deployed and managed, can have significant positive impacts on operations and resident satisfaction, so it is important to take the guesswork and uncertainties out of these deployments."

Participants reported that smart door locks and access control provide a 20% efficiency boost for maintenance staff by allowing them to enter residential units without needing to pull unit keys. The implementation of smart door locks and access control also reduces the number of door and lock replacements and associated labor experiences. With 10% fewer maintenance requests, respondents estimated a savings of $80,000 per building per year.

Water leak detectors and smart water meters have resulted in 25% or more in savings for old construction and per incident savings of $12,000 to $35,000. Benefits also include a reduction in the number of water leaks across portfolios and gallons of water saved.

In addition to the perks of energy use reduction and cost savings, smart thermostats prove to lower energy costs in vacant units but also the number of burst pipes and associated damage, saving anywhere from $2,000 to $700,000 per incident, according to multifamily executives.

Interviews found that cellular intercoms and gate controllers reduced costs by 75% compared with telephone-serviced systems, especially as plain old telephone service (POTS) providers are terminating service entirely. The closure of these providers could present immediate operational challenges for properties that rely on POTS for access control.

Additional smart tech that has boosted revenue for multifamily properties is self-guided towers. Respondents noted a 10% to 15% increase in close rates due to self-guided tours and the technology involved.

Parks Associates found that smart amenity packages are increasingly expected by residents and potential residents. "ROI for smart apartment amenities varies. In select markets, these amenities may be necessary for residents to consider renting at all. In others, they may result in lifts to rent ranging from 5% to 10%. These solutions commonly have a three-year payback period," the white paper reads.

While smart amenity packages vary, most include smart thermostats and other solutions such as smart lighting controls, video doorbells, and smart appliances.