BH and RKW’s playbook for third-party centralization + what it means for your team
In the closing session of Apartmentalize 2025, BH and RKW shared how they’re redefining centralized roles, leveraging AI, and building scalable operating models that meet the moment—and what’s coming next.
Melody King, Chief Operating Officer at BH, and Kevin Owens, President of Property Management at RKW Residential, are two of the most forward-thinking leaders in the industry who are actively shaping, testing, and evolving what centralization looks like for third-party managers. In this Apartmentalize session they explore what’s working, what’s changing, what they’re testing, and what’s next for third-party operators in this new era of efficiency and experience.
The intersection of AI + centralization
At RKW Residential—a large third-party manager and early Funnel partner—centralization is an active work in progress. Less a fixed framework, and more a philosophy under development. Owens described it as an ongoing process of optimization: evaluating tasks, roles, and responsibilities through the lens of efficiency and scale.
“We think about [centralization] as an evolution of the business,” Owens said. “Every day we should be thinking about what we can do better, more efficiently. We have a fiduciary responsibility to our owners to do that.”
Last week Owens’ responsibility expanded even more following the announcement of RKW’s merger with Quarterra Living, expanding its reach by 30,000 units. The combined platform now oversees approximately 52,000 residences and over $20 billion in assets, which according to the latest NMHC top 50 list, positions the group among the top 35 property managers nationwide.
RKW’s approach is “high tech, and high-touch.” One of the first steps in their centralization journey was to implement AI that works alongside their teams.
“AI is a fantastic tool for our teams to use when we talk about this new model…We implemented Funnel and now we have a situation where in many cases our AI leasing agents are outperforming our human agents,” said Owens, who explained their AI assistant, named KIT (short for Keep In Touch) converts at a 9.2% higher rate than human agents alone. “We are seeing great results from [our AI] that we are trying to build out across our portfolio.”
This allowed RKW to extend its leasing coverage, respond faster, and drive better outcomes for leasing teams.
“Tools like KIT, AI assistants generally have a good impact on site associates,” added Tyler Christiansen. “We polled our users and 74% of onsite associates feel that when AI is turned on and working alongside them, it’s saving them time and making them better at their jobs.”
“Tools like KIT, AI assistants generally have a good impact on site associates,” added Tyler Christiansen. “We polled our users and 74% of onsite associates feel that when AI is turned on and working alongside them, it’s saving them time and making them better at their jobs.”
But while AI and automation are driving measurable gains in efficiency, centralization isn’t just a technology story. At BH, it’s also a people strategy—one that’s helping redefine roles, reduce turnover, and deliver a more consistent experience at scale.
Moving the people needle + The Mint Experience
While AI continues to drive real efficiency gains, centralization at BH is as much about people as it is about process.
As the 11th largest third-party manager and 30th largest owner-operator on the respective NMHC top 50 lists, BH owns and manages over 100,000 units across 42 states.
With a people-first mindset, the company built an operational philosophy rooted not just in core values, but in a unified Mint Experience that bridges technology, employee engagement, and renter satisfaction.
The BH team found that centralization and role specialization created clear career paths and progression for team members. In an industry that is typically plagued by high team turnover, King revealed that 90% of BH’s centralized roles are filled internally, allowing team members to specialize, grow their careers, and stay connected to BH’s values.
“These are people who already know who BH is, what we do, and why we do it,” King said. “They are able to jump right into their role and do it in a way that is creating specialization for them instead of their generalized role on site.”
It’s HR common knowledge that team members vote on job satisfaction by staying longer and seeking more internal opportunities. The result of BH’s Mint experience for their teams? A 40% reduction in turnover among shared services roles, compared to traditional onsite positions.
Part of creating that consistent Mint Experience at scale is knowing where technology can step in—and where people should lean in. By leveraging AI and automation for repetitive tasks and supporting teams with the right tools, BH reduced friction without sacrificing the human touch.
In Q3 of 2024 alone, BH saw a 59% increase in leads handled by AI and a 113% increase in appointments set—proof that smart automation can drive both volume and velocity.
And it’s not just internal efficiency that’s improving. According to Funnel data, 96% of renters reported a positive experience with the company’s online application process, reinforcing that digital doesn’t have to mean impersonal.
“We had the luxury of looking at the overall process when we were building our centralized platform, and we asked what is going to move the financial needle, but also what is also going to move the people needle’,” King said. “We built [an operating model] that made it work for both—and you can’t do that without technology.”
“We had the luxury of looking at the overall process when we were building our centralized platform, and we asked what is going to move the financial needle, but also what is also going to move the people needle’,” King said. “We built [an operating model] that made it work for both—and you can’t do that without technology.”
Managing expectations: Upfront cost vs. NOI
After opening the floor for a Q+A, a session attendee raised a critical question: As a third-party manager, how do you convince owners to invest in centralization when the benefits don’t directly hit your bottom line right away?
It’s a real challenge, especially with flexible contracts, and sometimes opposing views on shared services.
“We are not at the point [of centralization] where we have the leverage to say, ‘take it, or else,’” Owens said. “If you can’t demonstrate the savings to the client, or revenue impact to a client, or NOI impact in a positive way, it’s going to be really hard to convince them to do anything.”
This is why many third-party managers begin their centralization journey with AI, and taking administrative tasks offsite. Many owner groups see the more immediate impact of unburdening the onsite team to focus on high-value customer service.
King noted that BH ran its centralized model at cost for nearly a year before the data could demonstrate the value on paper. This aligns with the findings in Dom Beveridge, of 20for20’s recent whitepaper on centralization for third-party managers. Beveridge noted that many of the firms who’ve made the most progress on centralization in the third-party space learned and drew insights from centralizing their owned portions of the portfolio first. BH’s ownership structure and portfolio composition make them a great example of this.
“The goal was to build the database so we could prove the ancillary benefits,” King said. “What we see is not only do you have the lower cost of turnover, better overall performance metrics, but we are seeing improvements in delinquency, fraud prevention, renewal stats, rental increases—so we are proving out the benefits in the programs.”
“Yes there is a cost associated with it, but at the end of the day the bottom line NOI is what speaks,” King added, “and we’ve been able to prove that over five-and-a-half years, almost six years that we have been running this program, that it is cost-effective.”
“Yes there is a cost associated with it, but at the end of the day the bottom line NOI is what speaks,” King added, “and we’ve been able to prove that over five-and-a-half years, almost six years that we have been running this program, that it is cost-effective.”
Still, King acknowledged that is not a one-size-fits-all approach. Different assets and different owners have different needs.
“It’s not status quo across the board. It’s about looking at your clients and saying let’s work together to get a program in place that is going to be beneficial for both organizations,” King said.
“It’s not status quo across the board. It’s about looking at your clients and saying let’s work together to get a program in place that is going to be beneficial for both organizations,” King said.
Predicting what’s next
For an industry that remained relatively unchanged for the better part of six decades, the shift kicked off by AI and centralization is nothing short of seismic.
The first wave of centralization was the REITs and owner-operators. The next wave of centralization is playing out right now: centralization for third-party managers.
As third-party management growth as a percent of all professionally managed units continues to outpace owner-operated units, the stakes are high for the leading and largest third-party managers to truly own this space.
As noted by the launch of Fenix, centralization has a new on-ramp through AI. The next wave of centralization initiatives are being built in closed-door boardroom discussions, and through shifts with AI that will revolutionize our industry.
“We live in a world of data and a world of speed to launch,” King said. “AI is replicating at a pace we can’t even fathom. The roles we’re hiring for today might look completely different by next year.”
She predicted more automation, more agentic AI, and leaner teams with higher-level problem-solving responsibilities. But the core challenge will remain the same: meeting renters, clients, and team members where they are—even as that definition continues to shift.
“I think opportunities are going to be endless for the people who choose this as a profession. I think it is going to open them up even wider, and greater, and deeper,” Owens said. “I think if we sit on this stage again next year, the picture we are going to have is completely different from today—and probably completely different than what we think it is going to be. I’m excited to travel this journey with everyone else.”
“You know, I was actually in a Blockbuster the other day thinking about this,” Owens joked. “No I wasn’t. You know why? Because they didn’t evolve. They didn’t innovate, and think about the future of what’s next. We have to do that [in multifamily]. And if we do that the right way, the right opportunity is going to be there and we are going to have conversations like this forever.”
With AI accelerating change at a pace the industry has never seen, and third-party management now outpacing owner-operator growth, the window for taking a wait-and-see approach is rapidly closing, and the organizations that will lead this next chapter are starting now.
Learn how you can get started and request a customized centralization playbook, or dive into our specialized roles and responsibilities instruction manual.