Commercial Investment Real Estate Summer 2021 | Page 45

are introduced , a turf war is brewing for the precious real estate on the home pages of residents ’ cell phones . Every service provider has its own app , so the last thing that a resident is going to do is use one app to unlock their door , another to let visitors in , yet another to pay their rent , one more to enter a maintenance ticket , and so on . Requiring a different app for every service removes the efficiencies that the technologies were intended to create . To solve this , companies often expand their offering to encompass more services — take a property management company that starts to offer tenant amenities , for example . Since both services are so different from each other , the expanded offerings are often subpar in quality compared to other companies that specialize in it . That leaves two possibilities to provide higher quality and functionality : integration and acquisitions .

Multifamily Operating Systems . An operating system could be an essential tool in the multifamily space — a single interface that acts as the system of record , while tightly integrating with best-inclass providers of other services . The companies that I believe are the most likely to succeed in this area are the property management solutions mainly due to their existing penetration , the stickiness of their products , and the deep pockets of the leaders in that space . Latch announced in September that they are building a multifamily OS , and although that sounds like a significant undertaking for the 7-year-old company , the firm has a massive war chest of recently raised cash to make this happen .
The next wave of advancements in multifamily will most likely take place inside residential units .

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Because everyone wants to be the system of record and the branded app that customers use , you end up with a situation where companies try to be everything to everyone instead of playing their role in the ecosystem . The other scenario which is equally as likely is that industry giants will continue acquiring companies that offer complementary services and build a true end-to-end solution of the industry ’ s best offerings . Yardi has completed over a dozen acquisitions in the last 10 years , and RealPage has acquired ClickPay , SimpleBills , Buildium , Modern Message , and Stratis since 2018 .
WHAT ’ S NEXT ? The next wave of advancements in multifamily will most likely take place inside residential units . Amazon is testing services like grocery delivery where the delivery driver enters your apartment and puts your food away in your refrigerator . The biggest test is whether or not residents can get comfortable with a stranger entering their home . Time will tell , but I ’ m willing to bet that they will . ( Just think , 10 years ago , would you have imagined getting into a stranger ’ s car before Uber quickly made this the norm ?) Assuming we can get comfortable with situations that were previously unfamiliar or uncomfortable , the possibilities for future proptech services are endless .
Glenn Felson Managing director at Kastle Systems
Contact him at glenn @ proptechfuture . com .
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