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Property Management
show a slower amount of increase in the last several weeks, as the seasonal decrease in prospects begins.”
Inflated Occupancy?
Beyond the strong occupancies numbers is an unknown: The effect of eviction moratoriums. “How inflated is occupancy because of people who haven’t paid their rent?” says Clare.
When Chris Riley, a Co-Founder and Managing Partner of Blaze Capital Partners, looks across his A and B portfolio, he sees occupancies generally in the 90s. The market took off in March and pushed forward throughout the summer. “Universally across the board, we’ve seen a lot of demand and out-sized rent growth for sure,” he says. “Much of that has just been predicated on the high occupancies.” But like Clare, Riley notes that there is a catch. “Some of that occupancy in the B and C space is somewhat hyper-inflated and is a byproduct of the eviction moratorium,” he says.
Clare agrees that the number of people in units but not paying rent varies by location and asset level. “Some markets were more impacted than others,” she says. “The markets where there’s a lot of service industry jobs felt it more than markets where people were able to work from home.” Occupancy hasn’t surged everywhere. In some places, particularly pricy urban areas, occupancy also suffered during the pandemic. And it still hasn’t totally recovered, though it also picked up during the summer. “The increase in remote work options boosted an out-migration as renters saw the opportunity to move closer to family, in the suburbs or any place that offered a change of scenery,” says Tina West, Senior Managing Director with Cushman & Wakefield. In the future, Tina West thinks hybrid working will benefit both urban and suburban markets. “Homeowners who capitalize on elevated home values and have no place to go after they sell will push a higher demand on rentals, which will continue to lower vacancies, eliminate concessions and bump rents,” she says.
Even with these increases, other issues are cutting into profitability. “Rents have gone up in my region, but we are just trying to keep up with the steep increases in inflation,” says Dan Flamini, Area Vice President for Morgan Properties. “Payroll, maintenance supplies, taxes, insurance, and repair services are all increasing steadily.”
Leasing Tech is Here to Stay
During the height of the COVID lockdowns, face-to-face leasing was nearly impossible. For the companies that had at least tested virtual tours before the pandemic, the transition was more manageable, according to Tina West. “The benefits of a digital landscape gave prospects access to leasing 24/7 and transparency in pricing and inventory,” she says. “The use of chatbots and interactive functionalities also helped us identify great prospects and guide their buying decisions.”
As it did for many other companies, the pandemic expedited the adoption of technology into leasing for Bell. While companies were already testing artificial intelligence tools and virtual leasing, the pandemic expedited their adoption. “We rolled it out across the board because there was a pandemic
going on,” Clare says. “But what we’ve seen is that we are now better able to meet the customer where they want to be met. Some people love the idea of doing a virtual tour and doing everything with an AI tool. And that’s great. We have that for them.”
In many cases, leasing teams led the way in this adoption of new technology, according to Flamini. “Many of our property managers and leasing agents took the lead and started showing our individual apartments and communities through virtual leasing and self-guided tours,” Flamini says. For ZOM, the pandemic has changed leasing forever. “We never imagined how well people would adapt to virtual leasing, which some customers prefer,” Greg West says.
A Hybrid Future
But that doesn’t mean technology is totally taking over. “You hear people saying that we’re going to be going to all virtual,” Clare says. “I don’t believe that. I do believe that we will continue to have people that want to come in and see their apartments and interact with leasing agents in person.” Wood has noticed that in-person tours have increased back to pre-pandemic levels. “However, virtual and self-guided tours will continue to be a part of our leasing strategy,” Hallsey says. That’s why leasing agents won’t be going away anytime soon. The pandemic has helped the industry figure out how to serve its customers, regardless of their desire. “The leasing consultants are there for them,” Clare says. “We also have people who want to do self-guided tours. We can accommodate that. So, I think [the pandemic] has expanded our ability to meet our customer’s needs.”
At ZOM, the strategy is similar. If the customer wants to connect virtually, most managers will maintain the virtual option for leasing. “Connecting with our customers in the virtual world was, of course, important before the pandemic but now [it is] more than ever,” Greg West says. “It is clear some people expect some, if not all, of their shopping experience to be online. It is our mandate to constantly find ways to more efficiently find and engage those customers.”
As technology has changed, so have some of the skills that leasing agents need. Flamini calls good computer and social media skills a “must-have” skill set. “Many of today’s leasing transactions are fully automated online without a face-to-face meeting until the day of move-in,” he says. “With that said, there are still renters who like to see the apartment and will always kick the tires before they make a commitment. This is why soft skills like being a good listener, friendly, informative and genuine are equally important in today’s marketplace and post-pandemic.”
Those same soft skills have been essential for leasing agents for decades. And even though the pandemic and leasing technology have upended the marketplace, they aren’t going away anytime.
Search Engine Optimization (SEO) Gains More Prominence
The apartment industry’s focus on search optimization and
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