Leasing and management software can improve a property’s bottom line while streamlining operations.
The student housing industry, like any residential property, relies on the organization of accounts, payments and data. In today’s market, much of that data is inputted into software programs and management systems in an effort to streamline management and gauge a property’s success. As such, student housing operators are always on the hunt for the best software and management systems available. While products and services are available, companies continue to push for more student housing specialized software, which would accommodate the unique needs of a student housing property.
Accounting and revenue management software is vital for most student housing operators. These systems allow for easy tracking, organization and recording the daily activities involved with managing a multifamily property. With options in the marketplace, operators are able to select products that work best for their specific property or management style.
Austin, Texas-based Innovative Student Housing uses OneSite, a product from Carrollton, Texas-based RealPage, for both its leasing/rents side and accounting side. For Innovative Student Housing, the software and system was easy to implement due to its user-friendly design, which extends from the site level to the corporate level.
Jeff Arnold, vice president of Innovative Student Housing, notes that the integration between the leasing and accounting aspects of the software, which automatically updates information across the entire system, has diminished excessive inefficiencies for the management and accounting operations, which has allowed the company to realign payroll cost.
In additional to general management, some software allows operators to collect a variety of data points from residences, including birthdays, emails, interests and social media outlets. Having this additional information allows managers to provide an extra level of customer service to the residences.
“This [information lets] you easily engage tenants by having activities geared toward their interests, which creates a great student experience,” says Arnold. These options also assist the on-site team with providing excellent customer service, which leads to increased retention of tenants, he notes.
Another important aspect of any management system is the ability to offer real time purchase order data that ensures items are budgeted for before they are ordered. This was a vital element in consideration when Innovative Student Housing selected a software platform.
“There are several good software options available, however it was important to find one that was user-friendly but would also interface with what is being entered on site and push that information into the accounting side,” explains Arnold.
In Arnold’s opinion, the most important function of a management system is proper reporting, which is crucial to monitoring the performance of an asset. “Having a system that shares information from the property to the accounting side is essential to this process, and we like the transparency and real time information that [the software] provides,” he says.
One aspect of any business offering a product or service is the prospect of unpaid debt. With the student housing industry, it’s no different, but there are options to make the process of collecting outstanding debt easier for a property management team.
Tampa, Florida-based Hunter Warfield is a national debt collection agency that specializes in the student housing industry. With the large turnovers in the student housing industry, management companies often find the collections process near impossible, which is where outsourcing collections becomes a way to handle the collections and still manage the property.
Glenn Swan, senior account executive with Hunter Warfield, explains that a student housing property typically holds an account for 60 days, which is a bit longer than the traditional multifamily property, but once the files are turned over to collections, Hunter Warfield is positioned to make a big impact on returning the debt.
Hunter Warfield has been a pioneer on electronic delivery of files and software integration for the collections industry. The company is equipped to handle automatic electronic transmission of files through integrated account placement with software such as OneSite, MRI Software and others, as well as manual file transmission through fax and mail. Once the files are submitted to Hunter Warfield, the property management team is free to return to the task of property management and leasing, while Hunter Warfield works the files through the collection process.
Unique to Hunter Warfield, is that the company is legally allowed to add interest to the principal debt of the individual, whether a student or a guarantor. With the addition of interest, the company is able to report two numbers — the principal and the interest — to the credit bureaus, and while the principal stays the same, the interest is compounded monthly so the individual’s credit report is being hit on a monthly basis.
“The benefit to the student housing client is that instead of charging an enormous amount of money up-front, now you’re applying a reasonable amount of pressure and the person’s credit is continually getting dinged,” says Swan. “The interest also gives us the added leverage of being able to settle on the interest instead of the principal.”
The company also has an in-house auto-dialer, which gives them the ability to handle large volumes of calls and accounts. “Many of the collection agencies have to out-source dialing so it’s an added cost,” notes Swan.
“We’re able to work more files and work them faster than most other companies. The technology is what really sets us apart from other agencies.”
Beyond Hunter Warfield’s technologies and processing abilities, the company prides itself on establishing business partnerships with all their clients rather than a simple business relationship.
“We’re trying to increase the bottom line by being able to actually get back as much money as we possibly can for our clients in order to affect their bottom line and get them the biggest net back possible,” says Swan.
The student housing industry is uniquely different from the traditional multifamily market and has a variety of needs that traditional multifamily management software and systems are lacking.
“One of the problems we have in student housing industry is there really isn’t a good off-the-shelf software, in my opinion,” explains Donna Preiss, founder and CEO of Raleigh, North Carolina-based The Preiss Company.
As the challenge presents itself, property management teams are left to fill the gaps for management software in order to make the products work for the needs of the student housing industry. Companies with access to capital may have the ability to develop their own software, but that can be costly and time consuming for management teams. Many companies have resorted to creating a mix-match of off-the-shelf software and using multiple systems.
Preiss notes that while there are adequate accounting systems available, her company has not found one product that can accommodate all their needs. Because of the lack of a comprehensive product — especially a product that integrates the accounting side with revenue management — The Preiss Company has gone the extra step to develop their own in-house software and system. One of the systems it has developed is called Daily Numbers, which generates a base spreadsheet from which specialized spreadsheets and analysis can be formed. The Preiss Company uses a variety of software and systems across their properties to accommodate the customization it requires. Some products include OneSite Leasing and Rents – Student Living Edition, OneSite Accounting, OneSite Leasing Desk, OneSite Online Living, OneSite Document Management and OneSite Payments. Additionally, the company utilizes ReManage at a couple of properties.
The company is also exploring an opportunity to test out OneSite’s product Online Leasing, which will enable the company to have a website that facilitates an entire leasing process from virtual tour to application to online payment and processing to real time criminal/credit screening to digitally signing the needed leasing documents.
The specialized spreadsheets are visual aids for properties so management teams can measure the successes and needed improvements a specific property, in a specific marketplace or against comparable properties and sites. Being able to visualize monthly target numbers against actual numbers, gives properties and management teams the ability to see where improvements are needed and what elements are proving successful.
Another challenge is comparing rents among properties in a given market. Being a niche market, student housing does not have the traditional comparable properties — a small percentage of residential properties may be true student housing property, but a majority are multifamily-student housing hybrid properties.
Although the traditional multifamily industry has experienced success with the available software, which offers rent comparing, the student housing industry oftentimes does not have the needed data points to make the software advantageous for the property owner.
As Preiss points out, “We’re by-the-bed leasing and the majority of software out there is by-the-unit software. None of the [software options] really get their arms 100 percent around student housing.” A revenue management system would be an ideal addition to the student housing industry, says Preiss.
While her company can easily modify a property’s target numbers — through rent reductions and concessions — to ensure success, it is more difficult to gauge when and how rapidly to raise rents, especially when pre-leasing velocity exceeds their expectations. “If we had a system that was objective and creditable, our properties would be comfortable with raising rents,” she notes. “I think a good revenue management system would do that for you.”
As with any market, challenges and solutions will continue to arise to meet the current and future needs of student housing operations and owners. Products are continually being adapted and modified as needs change and markets evolve, especially when servicers and users are able to connect and communicate across the marketplace divide.
— Amy Bigley