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The 20 for 20 Blog

The Multifamily Technology Projects that Dominated 2018


It’s easy to get caught up in industry hype – especially when new and exciting technologies come along.  Industry press, conferences and blogs like this one provide the platform to engage an audience in a conversation about the next big thing.  We recently took the opportunity to step away from the domain of thought leadership and ask a group of senior multifamily executives for their own perspectives about a range of issues – most notably, technology.

We started to interview our 20 executives at NMHC OPTECH, meaning that current technology trends were bound to be top of mind for our interviewees.  Our line of questioning, however, focused not on what was new and sexy, but which technologies constituted the biggest priorities for our interviewees’ companies. When we reviewed the interview responses we were struck by the types of projects that had dominated 2018.

The Technology Projects That Dominated 2018

We started off by asking about the technology projects that had dominated 2018, in the eyes of our interviewees.  Below we have summarized the responses; bold text represents an answer that we heard from multiple respondents.

  • PMS/platform implementation or major upgrade

  • CRM

  • Business Intelligence implementation

  • System rationalization

  • IoT/Smart Home technology

  • Cloud migration/enterprise Office365 rollout

  • AI-driven leasing and service pilots

  • ERP Implementation

  • Complete rebuild of the company intranet

  • Asset Management System design/build

The most obvious point about these responses is the prevalence of PMS platform shifts.  Of 20 executives interviewed, seven of them had either cut-over from one PMS platform to another or completed a major system upgrade on their existing PMS platform.  Simple arithmetic makes this result stand out: companies don’t change PMSs every three years, after all.

In addition to the seven PMS projects, three other companies reported having completed projects that monopolized IT project capacity.  It seems that after a decade of growth, many operators picked 2018 as the time to invest in foundational projects that will continue to deliver efficiencies through leaner times to come.  System rationalization was another prominent 2018 initiative which was seen as necessary after a decade of portfolio growth for many companies.

CRM and Business intelligence were the next most popular projects with the companies interviewed.  And smart home technology was cited as a 2018 highlight for two of our technology leaders, and an area that was being tested by several others.   Overall - as we discuss at greater length in our recent white paper (20 for ‘20) - we were left with the impression that 2018 was dominated by more familiar technologies than the ones that have been grabbing industry headlines.  

What about those technology costs?

It’s often hard to have a conversation about multifamily technology without some mention of spiraling costs, so we asked a simple question to gauge the direction of technology spending.  We asked each respondent to compare per-door technology spending in 2018 spend to that of 2017, and their prediction for how 2019 will compare to 2018. In each case, the question was whether the total was lower, higher or about the same as the previous year.


The numbers (shown in the table above) are interesting: few companies see technology spending going down, and a majority see them increasing in 2019.  Anecdotally, none of the leaders spoke of cost-reduction or even cost-containment initiatives. However, every respondent articulated a clear logic for why the numbers are what they are.  The cost dynamics were to do with projects and capabilities, all of which had clear ROI objectives, either through efficiency or improvement of resident experience.

A common explanation of the general increase is that although technology spending is increasing per se, the investment is in replacing costs elsewhere.  Numerous respondents had incurred higher technology spend by replacing legacy proprietary technology with off-the-shelf projects, for example.  Others had outsourced labor functions, reducing payroll costs but requiring some increase in technology spending.

Where respondents said that they were gearing up their platforms to pursue a particular growth strategy they also reported increased technology spend.  Examples include fee managers who, under margin pressure, had deployed new technology to drive efficiency. Another operator's portfolio strategy was changing to focus on the urban core, leading them to adopt new technologies to help service a different resident profile. In the cases where companies had implemented smart home projects, technology costs had increased, with the expectation that the investments will deliver revenue upside.

The fluctuations in spending are, of course, influenced by what happened in the preceding year. The timing of a platform shift was the usual explanation for reductions in year-over-year spend.  Given the unexpectedly high incidence of platform projects, it will be interesting to see where if this changes the direction of this trend beyond 2019.

In praise of “shutting up shop”

We didn’t expect to find so many companies so focused on a single project in 2018 and were curious about the potential implications.  In the case of platform changes, the need to eliminate all distractions is obvious. But different types of project, from back-office transformation to custom analytical system design-and-build, demonstrated some single-minded delivery last year.

On the one hand, this suggests a maturity in companies' approach to technology implementations.   In a confidential setting, several executives shared how they had purposefully "shut up shop", eschewing new projects to secure delivery of the highest-priority initiative.  None felt that they had over-extended their organization with too many projects. One feels the answer would have been different a decade ago.

On the other hand, focusing on a single project risks acting as a barrier to innovation, as the dominant initiative starves smaller ones of focus and resources.  We are hopeful that the foundational work of 2018 will spur greater innovation over the next few years. As we discuss in our white paper, we are at a tipping point in multifamily technology.  We look forward to seeing how it shakes out.


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