CoStar — So Long, On-Site Apartment Manager: Landlords Favor Centralized Model, Sometimes With Bots

Rental Owners Like Idea of Cost Savings While Trying to Make Customer Service More Efficient

By Andy Peters
CoStar News

Here’s a hot tip for property managers at apartment complexes: The jack-of-all-trades is out. The specialist is in and, sometimes, the specialist is a fake person.

It’s long been the case that an on-site general manager wears dozens of hats: collecting keys from renters who move out, finding a mechanic to repair a broken air conditioner, knocking on the doors of tenants who are late on rent.

That role of an on-site manager is going away, at least at some apartment property management companies, industry executives said this week at the National Apartment Association’s Apartmentalize conference in Atlanta. Executives from Cortland, Greystar, LCOR and other companies said they’re shifting many of the on-site property manager’s job responsibilities to a central office located off-site.

They’re also replacing many job functions with bots that automatically field renters’ complaints and requests.

The shift to centralizing and automating tasks kills two birds with one stone, Tyler Christiansen, CEO at Funnel Leasing, said during a conference panel discussion.

“The shift to centralizing and automating tasks kills two birds with one stone,”

— Tyler Christiansen, CEO at Funnel Leasing, during an NAA conference panel

“We’ve struggled with talent retention and we struggle to provide a quality experience to our renters,” Christiansen said.

“We’ve seen a reluctance” by some property managers to adopt these principles, he said. “But these are no longer unproven and unknown concepts.”

“We’ve seen a reluctance” by some property managers to adopt these principles. But these are no longer unproven and unknown concepts.”

— Tyler Christiansen, CEO at Funnel Leasing, during an NAA conference panel

Keeping Sales Staff Engaged

LCOR, which develops and manages apartments in the Mid-Atlantic and Northeast, once dealt with the problem of employing sales agents who were too good at their jobs, Chief Operating Officer Mike Hogentogler said during a conference panel.

“You have rock star leasing agents who are crushing it but when the building is completely leased up, they get bored and then they’re gone,” Hogentogler said.

“You have rock star leasing agents who are crushing it but when the building is completely leased up, they get bored and then they’re gone.”

— Mike Hogentogler, COO, LCOR, Inc.

Now, LCOR has centralized some leasing functions among properties in close proximity. That means a sales agent is no longer chained to a single property, Hogentogler said.

“Now they can float between properties,” he said.

Cortland, which develops and manages apartments, has seen improvements in its customer service because the central office now handles things such as sales and accounting, and it’s not all left up to the on-site manager, Scott Moore, chief technology officer, said during a conference panel.

“When you have someone as the manager on-site, that person has to be great at 50 things,” Moore said. “That’s really hard to do.”

“When you have someone as the manager on-site, that person has to be great at 50 things. That’s really hard to do.”

— Scott Moore, CTO, Cortland

Cortland is also conducting more virtual property tours, something the industry began fully developing in the days of pandemic restrictions. While some potential new renters still want an in-person tour, many consumers are comfortable with a digital experience.

“If you’re thinking about making reservations for dinner, you don’t call anymore and you don’t walk into the restaurant,” Moore said. “You do it online.”

“If you’re thinking about making reservations for dinner, you don’t call anymore and you don’t walk into the restaurant. You do it online.”

— Scott Moore, CTO, Cortland

Case for a Central Office

Apartment management companies have talked for years about the benefits of centralizing office functions, but a sold number still aren’t doing it. According to an informal survey that Christiansen conducted at the Apartmentalize conference, more than a third of property managers said they’re just thinking about taking the plunge or not considering it at all.

But it helps to organize job functions into a single department at the corporate office, said Kim Nicholson, senior director of property systems and owned assets at property manager Greystar. It allows staff to stick to the types of work they prefer, rather than feeling pressured to bounce around to deal with any problem that emerges.

“Our [staff] turnover rate in leasing has gone way, way down” as a result of centralization, Nicholson said during a panel discussion. “That’s a huge win because you don’t have those onboarding costs because you’re not consistently turning over the staff.”

Automating certain business functions can help in other ways with staff morale, Richard Malpica, general manager for the eastern region at Yardi, said during a panel discussion. After all, many tasks handled by property management staffers easily get tedious.

How many times do you want to answer questions from renters, ‘What’s your pet policy?’ and ‘Can I move in early?’” Malpica said.

“Automation leaves the tasks of higher-level issues to the humans,” he said.