Arize CEO talks about smart apartments in the multi-family industry

arise, A smart apartment technology company that partners with multi-family properties to provide smart ecosystem services to residents, delving deeply into the multi-family industry. It examines the drivers of growth in this sector and how property managers and landlords deal with competition against rising prices.

“During a recession-like economy, people are moving from luxury apartments or shrinking from homes to apartments, and with home prices ever going to rise, it drives up the pricing of many homebuyers, which in turn creates new tenants,” says Sylvia Crawford, Senior Managers of marketing strategy and planning in the company.

According to its website, Arize provides services to residents such as Smart Hub, remote apartment access, leak detection, and a resident mobile app. In March, it also launched IoT devices, including the Arize Smart Thermostat and Smoke Listener, and upgrades to its existing products.

FinLedger spoke with Kyle Finney, Director of Business Development at Arize about convenience as a service in smart apartments, smart devices that deliver risk mitigation and driving NOI and what that means for today’s multifamily industry.

As the Generation Z demographic enters the rental market, Finney says, smart technology is on the rise. The Internet of Things is all around us, especially when we talk to turn on the TV or want to listen to music. More tenants are willing to pay more than an extra $50 per month to avail services in smart apartments, and more people need to reserve parking in cities for just one night of hosting.

Q: Can you tell us a little bit about the concept behind the start of Arize?

a: Arize is really the brainchild of some sister companies that have been in the smart home business for many years. Arize itself is an owner-centric company that collaborates with property owners and operators to define and deliver integrated solutions that meet their everyday needs and challenges.

Within that, our mission is truly to deliver the best automated experience with customized turnkey solutions that instantly enhance the value of our customers’ property and also help simplify operations, without forcing them to pay for devices they don’t need. And a lot of times we notice that when we work with clients who already have a smart system, they either have a bunch of hardware they didn’t want to start with, or they don’t really need it that they’re paying for.

To successfully accomplish our mission, property owners can self-select and build product packages that work together in a cohesive ecosystem that helps respond to different scenarios and community living situations.

Q: What are some recent trends in multifamily housing that you have noticed in a post-pandemic environment?

a: 91% of renters think home intelligence is a necessity at this point. Especially when coming out of the pandemic, many people are working from home etc. But the residential landscape has already seen many changes over the past couple of years. That includes increased spending on the Internet of Things.

Globally, this multi-billion dollar model and the adoption of amenities as a service model, has become really popular in the smart apartment scene.

This is due to the presence of devices and products that work as a service. So things like having a smart thermostat in the unit to help control the temperature in the home allow property managers to really generate extra income, while adding an extra level of comfort to their accommodations.

Q: How is the current economy affecting the multifamily rental space industry?

a: Both renters and owners understand that rental rates are increasing at an astronomical rate. It’s important to understand where that comes from because the Fed rates are rising and so forth, the cost of capital for owners is much higher than it used to be.

Not only is there this, but you have increased construction costs, which has been the trend for many years, and labor shortages. You have to pay more to keep people or to hire people to do the same job they were paying less for in the past. All these factors into it, and when the landlord thinks, “My NOI’s going to be X per month, based on what I’m getting paid for rent”, and they’re going to decide the rents accordingly.

Often times, when you see these high rental rates, there is always a reason behind it. In terms of smart apartment technology, we see that it is no longer new, it is now just a cost of doing business.

70% of property owners and managers believe that smart tech devices are profitable to invest in. We would like to show that not only smart home appliances are in demand and that demand is not only always created by residents, but they can also see the return on investment through its implementation.

Q: How are amenities as a service changing the rental industry?

a: Regarding convenience as a service, it is often associated with owners who want to maximize their profits. More than half of the real estate owners surveyed agree that maximizing profits is their primary concern.

Proptech allows managers and owners to maintain productivity with fewer employees, which has a positive impact on payroll expenses. So you see many owners of large and small communities taking advantage of amenities as a service to boost NOI.

It could be that they roll the various amenities into a single utility fee that appears as a line item in their lease, or perhaps they are splitting it up in the smart apartment technology fee as a separate item. But either way, they charge a modest fee for the added convenience of the system they can offer residents.

It brings them a new stream of revenue. They put together a study that said residents would pay an average of $38 per month for smart apartment technology in their apartments. But in general, residents are willing to pay upwards of an extra $53 per month, depending on how many devices are already in that home.

In terms of classroom types, the use of this model of amenities, the model of service, and the application of smart technology within that should not only be for brand new buildings. I’ve worked with a lot of property owners and managers who have old properties, and properties that have already been built. So when it comes to retrofitting, you don’t really have to wait for a heavy rehab in order to get these types of hardware done. This is because they are plug and play.

Q: What other smart utilities are on the rise?

a: It depends on the society in which it is located. For example, communities located in an urban downtown area, where there are a lot of buildings vertically, as opposed to horizontal, there is not a lot of parking. If you look in Southern California, this ratio of parking spaces compared to resident cars is often very unbalanced.

Being able to offer a parking reservation app, so if you have a guest coming in for a few hours or maybe a couple of days, you can reserve that space to make sure parking is available.

The owner or manager may charge an upfront fee to use this, or they may charge X dollars to reserve a space for five hours, or two days. Others I’ve seen offer solar powered or managed Wi-Fi.

Q: What is the role of smart devices in the industry today?

a: Much of the demand is driven by tenants to have it. When you start looking at the population of Generation Z, they are getting into the rental industry more and more. Smart technology devices within the unit, and the value that owners have the ability to raise rent on these communities, everyone tends to smart technology to meet those needs.

Arize provides a simple, smart and innovative solution to many common multi-family problems. It seamlessly forms bonds that enrich people’s lives.

Q: Based on your feedback, can you point out some proptech tools that are underutilized, but have the potential to become indispensable in the future?

a: You just mentioned parking apps. As a lot of major cities are either redeveloping or running out of land in places like Phoenix, Austin, Denver, San Diego, and Los Angeles. I think reserved parking would be a bigger deal.

With all the immigration that’s happening to a lot of metropolitan areas like Phoenix, Denver, and Austin filling up these apartments with high occupancy rates. It’s just an ongoing battle. I have talked to friends who invite us back, we go to the park and we have nowhere to stop.

When it comes time to renew that lease it can be a deterrent, like I’d like to host people, but it’s impossible for anyone to find a parking spot when they come here.

Different sensors from a risk mitigation point of view, this is just a subjective opinion. But I speak to a lot of property managers who may spend anywhere from $20,000 to $30,000 a year on water damage to units. This is something that gets budgeted and allocated year after year.

If you can implement a system for $10,000, it will help you mitigate it. So you find this leak when it first occurs, take care of it and don’t have to hire a restoration company to go in and crack the drywall and put in fans.

At the end of the day, would you rather spend 10,000 up front, or maybe even 15 years, rather than having to incur not only the higher expense of paying contractors, but also the headache of displacing tenants and carrying out construction work on your property.

Q: How do IoT and AI fit into the multi-family landscape?

a: When it comes to the Internet of Things, there are a lot of IoT devices and ecosystems that people may not be aware of, such as the Internet of Things. If you’re used to walking into your home or apartment and saying, “Alexa, turn on the lights” or being able to change the channel on the TV just by talking, a lot of these types of IoT devices have really accelerated the demand for smart technology.

It’s here and multi-family residents want it, so smart technology isn’t a luxury anymore, it’s the cost of doing business. We see this as evidence as more and more developers adopt this technology in building plans for their multifamily communities across the country.

Arize’s smart tech ecosystem is here to help attract and retain residents in those communities. I think it’s a win for both residents, owners and operators. This applies to older societies right up to the entry of the Generation Z demographic into the market. It distinguishes itself from competitors.

Q: What are some of Arize’s upcoming plans that we should keep an eye on?

a: Iteration on existing hardware and then in terms of new hardware, we’re constantly doing market research and looking at what’s going to be the next thing.

And maybe we want to be ahead of the market in some of those. But if anyone wants to know more about Arize, we’ll be at Optech in November. We will have a good preparation. I would suggest coming to say hi, if anyone is going to be there, but also head over to the website, submit a contact form, follow Arize on LinkedIn, or reach out to me.

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In other recent proptech news, Hallstatt Real Estate Partners, Women-owned real estate private equity firm, announced its commitment to capital Stillwell Jerome, A project launched by a multi-family real estate management and investment company Coastal Ridge Real Estate. pure property management It also announced its 50 acquisitions since its launch in October 2020, including 20 completed during the first half of 2022.

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