The pandemic appears to be under control. Students are returning to classes. And student housing owners are singing the praises of a newish trend that has not only gotten many through the pandemic, but served as a blueprint for the next phase of student housing operations. What’s this trend? It’s called proptech.
“Proptech is the entire connected technology stack inside of a building that drives value to our building by enhancing the resident experience and boosting operational efficiencies,” explains Mark Zikra, senior vice president of technology and innovation for student living at CA Ventures in Chicago. “This is everything from building automation and integration with HVAC, all the way down to the way residents interact with our staff.”
Simply put, proptech in the student housing realm utilizes technology in an intelligent way that reduces the need for on-site staff, manually run operations and non-critical decision-making. Whether keyless entry, smart sensors, virtual tours, touchless controls, digital lockers, data analysis, climate control, online rent collection, service requests and even off-site management, proptech provides the comprehensive ecosystem and human-centric solutions that make life easier for both student residents and the managing staff.
“Student housing properties that focus on proptech are ahead of the game,” says Peter Weiss, chief real estate officer at New York City-based Latch, a building-wide system designer that integrates products, software and services. “There are security, safety and convenience benefits for students, there are operational benefits for property management, and there are benefits for stakeholders, guests, maintenance workers and delivery personnel.”
For the Students
College students are always at the forefront of technology. It stands to reason, then, that this is a trend student housing operators can count on not going away. Utilizing proptech is a streamlined way for property managers to provide the seamless tech experience students love, while keeping them safe at the same time.
“In this post-COVID environment, students and their parents will be looking for spaces that provide an extra level of safety, security, convenience and control,” Weiss notes. “Students have come to expect certain technology they are used to at home — smart home features, smart access and the like. Not offering these features would put student housing owners and operators behind the pace, which will ultimately negatively impact lease-up and retention rates and create additional costs.”
These student-centric features include state-of-the-art climate control in units, strong Wi-Fi throughout a building, the ability to reserve common areas like study lounges, gyms or pool facilities, and keyless entry for residents and guests.
“If all of these features can be managed under a single software ecosystem and a single app, that is a game changer,” Weiss continues. “A community that is connected, safe and convenient will enable students to feel more comfortable and productive, especially under a hybrid learning model.”
Trimark Properties utilizes the Latch smart access system at Cascades, its newest luxury building near the University of Florida in Gainesville. The system was installed on all building entry points, unit doors and amenity spaces like the fountain courtyard. The student-facing Latch app allows residents to gain access to the building’s front door, parcel room, amenity spaces and their private residences. Trimark officials have noted Cascade has an above-average renewal rate of 60 percent, which the company partially attributes to the Latch system.
A similar story is playing out in Louisville, Kentucky, where PeakMade Real Estate operates The Clubhouse, near the University of Louisville. The 758-bed community contains amenities like a computer lounge, fitness center, resort-style pool and movie theater. With enviable amenities, Peak needed a solution that would allow residents and their guests access, while keeping out the general public. They chose Butterfly MX, a smart video intercom that lets residents receive video calls, unlock the door remotely, and grant managed access for delivery people and service providers.
“Proptech will help student housing facilities come back after COVID-19 by allowing them to grant contactless and remote property access,” says Cyrus Claffey, founder of New York City-based ButterflyMX. “Since many schools will still mandate some kind of social distancing policy, contactless entry will be important — think contactless entry for friends, family, deliveries and visitors. Also, the ability to grant remote entry will not only assist with maintaining social distancing guidelines, but also allow student housing staff and residents to manage access without being physically at the building.”
Two other pain points for students and parents — particularly during the pandemic — were leasing and moving. Most in-person tours were canceled in 2020, and many still remain paused. Austin, Texas-based Aspen Heights Partners was using proptech before the pandemic, but found its applications particularly useful once face-to-face interactions ceased.
“For students, proptech provides an added layer of convenience that quickly became a necessity at the onset of COVID-19,” says Demi Sterling-Kinney, the firm’s executive vice president of operations. “Virtual reality tours offer resident prospects the ability to tour our properties from the comfort of their homes. Through proptech, students and guarantors are able to tour, apply, sign their lease, pay their rent, submit service requests and stay in communication with the site team, from anywhere in the world, 24/7.”
Staying connected is one thing, but moving into a new residence — one you haven’t seen in person, on your first time away from home, during a pandemic that requires social distancing — is another.
Aspen Heights enlisted Turnable to help with its move-ins. The software solution manages all aspects of the turn process in one centralized dashboard with a self-guided interface that supports turn end-to-end.
“Turn is arguably the busiest time of year and one of the most impactful on the resident experience,” Sterling-Kinney notes. “Turnable gives us the same level of visibility and better organization — eliminating the need for chaotic spreadsheets and other physical documents — as we manage and track the process.”
Though Turnable works well for student housing owners and managers, Philip Cannata, CEO and co-founder of the Austin, Texas-based software provider, says it’s ultimately the residents’ experience that will indicate whether a proptech tool is successful or not.
“When operators can more effectively manage a turn, residents can experience smoother move-outs, unit transfers and move-ins,” he says. “Operators who have had rocky turns can often draw a correlation between their turn and a spike in negative online reviews. While proptech can’t ‘do turn’ for us, solutions such as Turnable help operators effectively manage the process, therefore achieving optimal turn results. A successful turn results in clean, move-in ready homes, which translates to happy customers, and having happy customers can give operators a market advantage.”
The pandemic may be waning, but Aspen Heights, for one, will continue to utilize proptech whenever it provides easy, convenient solutions for students and staff.
“Proptech will continue to offer convenience well after the pandemic passes,” Sterling-Kinney says. “Utilizing smart locks to physically tour a model through the use of a limited access code texted directly to a prospect’s phone means they don’t have to rearrange their schedules around our operating hours. Parcel lockers that are 24/7 allow residents to pick up packages when it’s convenient for them. Smart thermostats allow them to better monitor their utility usage and save money throughout the year.”
For the Owners
While students may see a seamless experience through proptech, owners are naturally concerned about what these processes look like if you pull back the curtain and see the wizard. Thankfully, most solutions offer as much convenience to the owners, managers and developers as they do to the residents.
“While proptech can help students, the true value is felt by the property management team as it can help them create more efficient operational processes from a management perspective, a better experience for those student-residents living on campus, and protect assets,” says Demetrios Barnes, COO of Scottsdale, Arizona-based SmartRent, a smart home automation company that builds and deploys property solutions. “The great part about proptech is that it really doesn’t impact the initial design of a project too much.”
This is good news for every owner and operator. New door locks, thermostats and Wi-Fi can easily be added to current buildings with little disruption. Even leak sensors can be mounted anywhere in the student housing facility, often with no prewiring.
Such was the case at The Rochester, a 96-unit luxury apartment complex by R.W. Selby & Company that is situated near UCLA in Los Angeles’ Westwood Village. SmartRent installed leak sensors that detected a burst bathroom pipe on the third floor. The sensor picked up on the leak and notified staff before the damage moved beyond the unit and into the greater community.
“Had there not been any leak sensors installed, the water would have flowed down to the floors below, causing major damage throughout the building,” Barnes explains. “This would have impacted R.W. Selby financially — having the insurance deductible raised, labor costs to fix the issue — and created a major inconvenience to student-residents. Fortunately, the damage was minimal.”
For Aspen Heights, proptech wasn’t just a means to continue operating through the pandemic, but a time- and money-saving solution when it came to training. Before Turnable, Aspen Heights traditionally flew all of its general managers and maintenance supervisors to a one-week, in-person training conference to address turn.
“This was not possible mid-pandemic,” Sterling-Kinney says. “Luckily, the Turnable software is far more intuitive than the complicated turnboards of the past and is supplemented with thorough online training modules that reduce the need for expensive, in-person trainings. Even further, the visibility the software offers made in-person turn support unnecessary as supervisors and support teams were able to offer even better oversight and support remotely than they could in person.”
Properties that feature keyless entries also save money on staff, as there’s no longer a need for front desks or personnel to manage package pick-up.
“Businesses have long looked to manage the cost of human capital through automation, and that concept is more prevalent today than ever,” says Branigan Mulcahy, co-founder at Austin, Texas-based Virdee, a SaaS (software as a service) company that provides virtual reception and customer engagement software. “Technology provides the ability to streamline the customer or tenant acquisition process through automated workflows. When customers are comparing two residences, they will often choose the one offering a more modern experience.”
Amy Blackman, managing director of the student housing practice at Apprise by Walker & Dunlop, has seen the tangible values of proptech on student housing communities up close.
“Implementing proptech into student housing properties can increase tenant satisfaction, thus driving quicker pre-leasing, higher occupancy and, in turn, higher rental rates than competitors,” she says. “While these initiatives can be expensive to install and implement, tech-savvy students expect innovative experiences, amenities and designs.”
For the Bottom Line
Like all tech initiatives, not every proptech trend, company or product will be a success in student housing. As other industries, such as retail, have shown, some technological advances stick and are worth the upfront investment, while others are simply bells and whistles that sound fancy, but don’t serve any useful purpose and don’t justify their cost.
So how do you determine which proptech features will bring value and are worth the investment? Zikra believes this starts with asking the right question.
“One thing I hear over and over again is ‘how is this going to help me increase rents?’” he says. “This is unequivocally the wrong question to be asking. While there are opportunities to increase rent with proptech — as with all technology — many of these ways will be table stakes in the next year or two as residents continue to expect cutting-edge tech in their living accommodations. The better question to ask is, ‘how is this going to improve the resident experience or drive operational efficiency?’ And to take it a step further, ‘what problem is this technology solving for me?’ If you have a clear problem that is being solved, the value will be obvious.”
For Claffey, this involves talking to your staff and residents to determine their pain points. From there, the solution(s) shouldn’t involve lots of wiring or infrastructure improvements. The best proptech solutions today, he notes, leverage wireless technologies, the internet, and the cloud to eliminate the need for on-site servers, building wiring and other infrastructure.
“As long as the property has reliable internet and power, a proptech company should be able to deliver all of their features without any existing infrastructure,” he says. “Once you’ve determined the pain points you’re trying to solve, find a proptech company that provides simple, easy-to-use solutions for these problems. If the solution is too complex, no one will use it, which is a waste of time and money.”
This also entails doing your homework ahead of time to ensure an existing building is equipped to handle any physical devices or changes that may be needed. This includes changing the locks on doors, installing package lockers or replacing thermostats.
Barnes recommends going with a proptech company that can not only address all your pain points, but one that is willing to do a thorough site walk and assess the various areas that would be impacted by installations. This should be followed by a detailed statement of work that includes deliverables and timelines to ensure a turnkey experience focused on efficiency and velocity.
“It’s best to first ensure the solutions you are looking at are highly integrated with your property management system,” Barnes adds. “This would allow for a seamless experience with prospects, residents and the management team. The real estate industry is leveraging proptech at a rapid pace, only driving demand from various customers, which means competitiveness in the market is key. Proptech companies have to ensure they are solving a problem, while removing barriers of usage to the customer. The customer — whether prospect, resident or manager — has too much going on to think about another product to use.”
The industry may be competitive — and proptech solutions may appear easy and seamless on the surface — but Latch’s Weiss says that a solid proptech provider is easy to sniff out as long as they’re vetted before you sign on.
“Solutions that are well designed with users in mind will stand out from the crowd and point you in the right direction,” he says. “So try before you buy. Prioritize due diligence that allows you to touch and experience the solution for yourself.”
If the experience with the proptech company and its solutions is good for you, chances are high it will be good for your students as well. Once this tech ecosystem is built out, many student housing operators also find they not only save money, but have more time on their hands to devote to their actual clients — you know, the young adults occupying these units.
“Allowing staff members to focus on the more important, human-centric activities breathes new life into the building and staff,” Zikra says. “By positioning your strategy to focus on proptech that solves problems that are either extremely inefficient, mundane, repetitive or unnecessary, you will start to see the immediate benefits of a more connected and integrated environment.”
This article was originally published in the May/June 2021 issue of Student Housing Business magazine. To subscribe, please click here.