Introduction
Build to Rent is set to have a record-breaking year for development starts in 2022 (CREB, 2021). Build to Rent apartments can be found in almost every major city in the UK, and developments like these can offer residents a personalized luxury rental experience that can replace the generational appetite we’ve seen for owning your own property.
During the financial underwrite creation for a BtR development, one of the key factor’s investors will be looking at is the expected lease velocity. Lease velocity can be defined as how quickly a development gets to stabilization (stabilization usually being around 95%+ occupancy). For example, a good lease velocity for a BtR development of 250+ units would be 30-40 leases per month.
The pandemic accelerated a trend already taking shape in the industry – Automated Leasing. In response to the market disruption, forward-thinking BtR operators have implemented new operational strategies and automated leasing technologies to address the needs of today’s renters while maximizing asset performance.
In this article, we review how technology and specifically automations can be used to increase that lease velocity.
Lead Tracking, Apartment Tours, & CRM
Historically, leasing offices relied on paper guest cards which were riddled with errors, constantly lost among the shuffle, and otherwise required manual work that took time away from customer service. They also forced onsite teams to cobble together lead tracking. This dynamic necessitated the physical presence of both the prospective renter and leasing staff, which slowed lead generation and put unnecessary hurdles in the path of lead-to-lease conversion.
Self-guided and virtual tour technology, digital leasing platforms, and integrated CRMs have mercifully replaced paper guest cards. Self-guided and virtual tours not only make apartment touring more convenient, but also facilitate more secure and efficient leasing experiences.
According to LMC Marketing development with virtual 3-D tours are receiving 49% more inquiries from prospective residents than listings without virtual tours.
Payment Solutions
Managing paper rent checks is a time-consuming process that not only comes with manpower costs, but also lacks convenience, security, and NOI, and often contributes to incidental expenses. Meanwhile, online payment solutions provide renters with payment options while allowing leasing teams to focus on generating and closing leads.
Automation in Action
Rent payment technologies automate payment processing and integrate with property management systems, thus optimizing financial performance, reducing risk, and streamlining operations. As more renters faced financial challenges due to the pandemic, automated payment solutions offered greater flexibility for both residents and operators. Onsite teams were able to extend payment options through these integrated systems to ensure rent was paid and residents were comfortable with the payment process and timing.
Pattern recognition of void periods
One of the most important aspects of Build to Rent is understanding when an apartment will be up for rent. Pattern recognition technology can be used to estimate when and for how long an apartment will be void. This can help leasing teams to better manage their resources and increase their lease velocity by being proactive to unpredictable void periods.
Automation in Action
When a tenant is due to move out of an apartment that has been historically difficult to lease – for example because it is on the first few floors of the development. Systems can notify the management team of the previous difficulties and recommend the ideal tenant who is likely to request the location and commit to a longer-term tenancy. Therefore, allowing operating/ marketing costs to be spent on locating and targeting the ideal tenant profile for a historically difficult apartments within a development.
Conclusion statement
Technology has always been an important part of the property industry, and it’s no different for Build to Rent developments. Automated leasing technologies have revolutionized how apartments are rented, making the process easier and faster for both tenants and leasing teams. Payment solutions automate rent payment processing, reducing risk and streamlining operations. And pattern recognition technology can help leasing teams better manage their resources by estimating when an apartment will be up for rent. By automating these processes, Build to Rent developments can save time and money to focus on providing a more convenient experience for renters.