Cloud Computing

Time was when on-demand computer applications—the kind you access via the Internet, rather than on your company’s own servers—were as rare as hen’s teeth. Even if they did exist for the most basic of apartment industry functions, they were attractive only to small players who couldn’t afford their own IT departments.

Today, “cloud computing,” as it’s sometimes known (“software as a service,” or SaaS, is another moniker) has gained legitimacy, as companies use browsers to access such tools as quote sheets, marketing modules, online brochures, move-in/move-out accounting, renewals, work orders, report writing and all the usual back-office general ledger tools, and many other online capabilities.

“We’ve eliminated the need for a virtual private network here at my office,” says Raymond Scarabosio, senior property manager and owner of San Francisco-based Jackson Group Property Management, of his recent switch to Internet-available business applications.

Jackson Group recently switched from a suite of apartment business applications it maintained on its own server, and decided to go with an entirely on-demand suite from AppFolio. Scarabosio is quick to say that his previous server-based suite was fully up to the task of managing his business.  But, he says, cloud-based applications allow users to log into the system from any Internet-equipped device. “All I need is an Internet connection, and I can do work orders on my iPhone,” he says. “You can do everything, even when you’re on vacation.”

Keeping things separate

Segregation of responsibilities is another advantage of “the cloud.” With password-protected Internet applications, a staffer responsible for just updating resident cards might be allowed access only to that small slice of information. Sales reps might access marketing modules alone, while accounting personnel could log into their own levels. Top executives might want to check out dashboards providing graphic snapshots of trends.

Software vendors who used to be solely server-based are embracing the cloud. “Almost 80 percent of our sales now are hosted by us,” says Scott Wiener, vice president of information technology with Yardi Systems. “It’s really picked up in the last few years.” Wiener says the tradition of cloud computing being the province of smaller businesses still pertains to Yardi; of the company’s 1,800 clients availing themselves of the company’s on-demand applications, some 1,500 of them are smaller guys.

“They don’t necessarily have the technological capabilities, but they all have the Internet,” Weiner says. “With a browser, they’re up and running.”

But the cloud also appeals to larger companies, particularly because all those bulky reports and database files—server memory hogs—all can be maintained on the vendor’s own hardware.

“That’s among the cloud’s most important features,” says Georgianna Oliver, president of EverGreen Solutions, a technology consulting and integration firm acquired by RealPage last fall. RealPage also rolled out its cloud computing division for outsourcing data center and applications hosting to its own servers.

“The beauty of cloud computing is that the data is accessible immediately, and can be pulled out fast and efficiently,” Oliver said. “It no longer makes sense for companies to host their own data, no matter how big or small they are. It’s too labor-intensive and expensive. It’s not just about hosting; it’s connecting all the dots for more robust reporting.”

One reason why on-demand business applications are becoming increasingly common may be due to Google. Many individuals have become comfortable using such cloud-based applications as individual Gmail and Google Docs. It’s only natural that companies, in turn, will check out Google’s various enterprise-level applications as well, including Gmail for business, Google Calendar for scheduling, an enhanced docs-spreadsheet-presentations suite, and other services.

A ‘private cloud’

Lincoln Property Co. is an example. The Dallas-based company, with more than 130,000 apartment units under management, explodes the old idea of cloud computing being attractive only to the small fry.

“We use Google apps—plus all the rest of their services—as our primary e-mail system,” says Jay Kenney, chief information officer with Lincoln Property Co. The company also is one of the biggest customers of Yardi’s cloud-based real estate management applications.

Yardi runs for Lincoln what Kenney called a “private cloud,” meaning the vendor maintains Lincoln’s Oracle-based databases separate from other customers.  “At the end of the day, we felt that the vendor could run things better than we could,” Kenney says. “Vendors can do it at scale, for a lower price at higher quality.”

Cloud-based business apps for the apartment industry isn’t for everybody. For example, many financial services companies still insist on maintaining their own databases in-house, as do government organizations. And there are real estate companies who opt for their vendors’ server-based applications—not their similar cloud products—just to have what they feel is better control.

“But I can see the real estate industry getting to the point where everything is Web-accessible,” Kenney says. “Our own most mission-critical applications are run somewhere else.”

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