5 IoT Mythbusters
By Felicite Moorman
MultiFamily is rapidly moving to the forefront of technological capability –converging with millennial and boomer demand, and in an ever more competitive market, embracing technology as an amenity is increasingly important. The decreasing costs of smart, connected, and “Internet of Things (IoT)” hardware and the increasing sophistication of software, make significant return on investment more viable in MultiFamily, and pioneering strategic partnerships more prevalent. Many are eager to capitalize on this market, but understanding some pervasive misinformation is crucial to success.
Here, we dispel the top myths of the market, with a moment of technology truth.
Single Family IoT works for MultiFamily.
Our first MultiFamily Myth is that single family IOT works for MultiFamily. This simply isn’t true, though many property owners and managers are being convinced to shoehorn traditional single-family automation devices into multifamily. But with a moment’s consideration, it’s clear that building systems are entirely different than house systems and a property manager or owner’s needs are entirely different than the single-family homeowner.
Pin pads and key codes lead to less secure properties and thermostats that have to be taken back to the leasing office, connected to internet, and factory reset when a resident moves out, were clearly never considered for multi family when designed. The space is specifically challenging for door locks and thermostats, but some other devices have issues as well. It’s important to pause and consider whether they were developed for the single-family home or for multifamily buildings, otherwise your smart technology can feel pretty dumb, pretty quickly.
A Property needs Internet everywhere.
Many are under the impression that Internet needs to be installed property-wide in order for the Internet of Things to have an impact. This is MultiFamily Myth Number Two.
It’s not necessary to run wire to every unit in order to participate in the Internet of Things in a way that provides return on investment to property owners and managers. Wire can be run to the telecom closets and even trash chutes, places that provide for discreet connectivity and don’t interfere with your building systems or require you to run cable throughout. This is called a mesh network system, but they’re not all built the same, and any network, mesh or otherwise, that is reliant on your Resident’s WiFi disables the system when your Resident leaves.
A Property must install ALL the Things.
Myth Three is the representation that IoT is an “all or nothing” scenario. A property doesn’t have to install ALL of the Things to participate in the Internet of Things.
If a company is making margin on hardware sales, it makes sense that they present the “all or nothing” approach. But you don’t have to go whole hog if bite size is the right size. The focus of your Internet of Things pursuit should be on your pain points and issues. Don’t create a need where there isn’t one.
It’s very simple to start with electronic door locks or smart thermostats and expand your system from there. If you are dealing with an offering that doesn’t provide step-by-step expansion, find another company and build out for your needs. This is especially true of the retrofit market. Easily installed technology is a great way to differentiate to compete with new construction, but budget constraints may require a three to five year plan of adoption, a welcome model for the right provider.
IoT is expensive and complicated.
MultiFamily Myth Four is that the Internet of Things is expensive and complicated.
The goal of your IoT provider should be to make the technology all but disappear. Of course you want to show that technology off when you show an apartment, but after that it needs to become an integrated part of the life of you and your Resident in the same way that it’s integrated into the building -nearly invisibly. This happens with easy to use interfaces that integrate into the databases of your current property management software and hardware that’s made for MultiFamily.
As far as expense, return on investment should focus on the property owner and manager, through a tangible decrease in operating costs and increase in security and mitigation of liabilities. With a real return on investment, the cost of the systems pay for themselves, even outside of revenue lift from increased rents.
The only ROI is via revenue lift.
Which brings us to MultiFamily Myth Five, that return on investment is only achievable through an increase in rental revenue. As mentioned above, when using any Internet of Things technology, the cost should pay for itself in the form of return on investment, through a decrease in operating costs and increase of security and mitigated liability, which we expect will soon be exhibited in a reduction of insurance costs, much like a home security system reduces the insurance of the homeowner.
Access management and control is a great example. With the right system, property owners and managers no longer have to leave the desk to “rekey” a door lock, create a replacement key, or create a new key. In addition, your maintenance staff member no longer has to go to the office to receive a credential on your property.
Your Resident simply sends a maintenance request via app to your property owner or manager with the picture of the problem. After which, your property owner or manager can schedule a time slot verification to the Resident and send the credential directly to your maintenance member’s smart device. All of this is entirely and perpetually auditable, without key pads and pin codes, increasing security and accountability on your property.
Operating costs are also decreased when property owners and managers automate the management of energy usage of vacant units and common areas, and during turn in student housing and new construction. Incentives and rebates are also available from municipalities, utilities, and others for these energy saving measures. We have seen systems paid for almost entirely my grants and incentives from local, state, and federal governments and utilities.
But here’s the real question: Is the need for the IoT the biggest myth of all?
Do you need to engage the Internet of Things? Or is this just a passing trend?
Today, the IoT is a great competitive differentiator, technology as an amenity, but think about your hotel credential. Can you remember the last time you received a hard key at the front desk? For some of us, we don’t even go to the front desk anymore. That’s because the electronic access system of hospitality, that was once a competitive differentiator, like Hilton’s Bluetooth access today, became a competitive advantage by significantly reducing operating costs, enough so that it transitioned again from competitive advantage to industry standard. That’s the arc of adoption, and it’s what we’re seeing in MultiFamily. Similarly, other devices and systems are taking their place as competitive differentiators today.
Which will transition? Stay close. We’ll be watching and sharing. Join us on LinkedIN at IoT for MFE.
STRATIS has successfully installed more than 120,000 MultiFamily units with the STRATIS platform. Reach out to our Team, to find out more.