Excellent Service Is Multifamily’s New Must-Have Amenity
- May 27, 2021
The pandemic-induced anxiety, coupled with civil unrest, has put pressure on the Minneapolis-St. Paul multifamily market over the past year, urging industry players to recalibrate their business and marketing strategies.
Multifamily operators have been tasked with creating a safe space for both existing and future residents, from the leasing to the move-in process. To do so, it was essential to listen to what renters want and tailor the experience to their needs, according to David Keinert, senior director of property operations at Bigos Management.
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The company owns and operates more than 50 properties across the Minneapolis-St. Paul region, so Keinert has a good pulse of the market. In the interview below, he sheds light on trends that shape the Twin Cities multifamily market and unveils the efficient marketing strategies multifamily operators should consider implementing.
How would you describe Twin Cities’ multifamily market before the pandemic? How do you see the market now?
Keinert: I feel that the Twin Cities market was overlooked as a flyover for quite some time. The last five years saw a significant increase in out-of-state and foreign investment here. Before the pandemic, it seemed that a construction project was just about in every neighborhood you looked. When the pandemic hit, along with the civil unrest surrounding the murder of George Floyd, you could certainly see some hesitancy in the market, especially in the urban core.
While we certainly have seen renewed interest in suburban markets as of late, there is no shortage of development in Minneapolis and St. Paul proper. With multifamily looking to be a stronger investment than hotels, office space and retail for years to come, I think we will continue to see a lot of excitement in our multifamily market here.
Which Twin Cities submarkets/neighborhoods fared better over the past 12 months?
Keinert: With over 50 properties in the Twin Cities, we have a great pulse of the market. Our suburban properties certainly have fared better over the past 12 months, staying on course with national trends. Both Downtown Minneapolis and St. Paul were hit hard with closing offices, restaurants and entertainment venues. This, coupled with the civil unrest in the Twin Cities, was the perfect storm to cause urban renters to look elsewhere.
The Twin Cities have some really great suburban markets like Edina, Maple Grove and St. Louis Park that offer just as much in dining and entertainment compared to their urban counterparts. These suburban areas provided much more value than our downtown areas during the pandemic, and renters noticed.
It remains to be seen if that trend will continue as offices are still shuttered. While we see some urban areas like Downtown St. Paul making a slight comeback, Minneapolis is still lagging.
How has the health crisis impacted Bigos Management’s multifamily portfolio and operations?
Keinert: Looking back, we are indeed stronger operationally from where we were before the pandemic. Even with the uncertainty surrounding COVID-19, we were able to take on three acquisitions during 2020.
From the start, we all got a crash course in flexibility. We worked hard as a team to improve our customer experience during a time of uncertainty.
For current residents, that entailed hosting virtual resident events, being more flexible on some of our policies, and enhanced cleaning protocols, including electrostatic sprayers. For prospects, that meant providing ways to tailor their sales experience and giving them more confidence to rent during uncertain times with flexible terms and prospect-centric revenue management.
What can you tell us about rent collection across your portfolio since April 2020?
Keinert: We continue to see improvements throughout the portfolio every month that goes by. We are optimistic that the new Rent Help MN program launched in April will provide needed support to those who are still struggling to pay rent. Our management teams continue to work with our residents to help them secure this funding. We want to help those struggling to pay rent so they can remain in their homes. It’s just the right thing to do.
How has the pandemic changed your multifamily marketing strategies? What are some of the biggest changes you have implemented?
Keinert: The prospect was speaking, and we had to listen! Things that were on the marketing wish list, like recorded video tours, live video tours, 3D walk-throughs and self-guided tours, became very important. Our approach to touring was perhaps one of the most significant changes we implemented.
We want to provide our prospects the sales experience they want from us, recognizing that it’s no longer a one-size-fits-all approach. Whether that’s a video call, self-guided, or virtual 360 tour, we are meeting the prospect’s needs while respecting their comfort level with social interaction in the process.
As an industry, it was great to see the mindset shift from doing things how we’ve always done them to embrace a new way to do something. I think the companies that embrace this rapid change will come out ahead in the minds of prospects and residents.
How do you make sure your apartment communities are appealing to potential renters during a pandemic? And how do you retain existing renters?
Keinert: Marketing will always be about possessing intimate knowledge of who your customer is, how you can attract them to your business and how you keep them as a customer. How we as marketers achieve that will constantly be changing. That’s why I enjoy all the different data sources we have access to now: Google Analytics, CRM, Customer Experience, Financial and Revenue Management, to name a few. But it’s not just about having the data. It’s about finding actionable insights from the data that helped us remain at the forefront of our potential renters’ minds.
With the ability to understand how engaged—or not engaged—our potential renters were, we could make meaningful adjustments to our follow-ups and drip campaigns. We also added media where we needed to. We could see the response immediately in our metrics and it motivated us to push harder and add more.
We also constantly look at the resident experience. It was imperative during the lockdowns to keep the personal connection between our residents and the management team…Having customer experience insights allowed the team to easily understand what areas we could focus on to make the most significant impacts to keep our residents happy.
What role does technology play in your marketing strategy?
Keinert: With all the recent advancements in the marketing space, it’s hard to determine which will significantly impact the portfolio. We always look at new products. However, we are all about finding the right technology to help us execute our marketing strategy and not letting the technology dictate our strategy.
Technology that helps us understand our customers better is of the utmost importance for us. During the pandemic, our CRM system was integral in helping us understand the changes in prospect behavior. It allowed us to pivot and pivot correctly to better meet our prospect’s needs during the sales process.
Outside of our CRM, prescriptive analytics helped determine what advertising sources were working and where we should increase or cut spending. With the marketing team having to change gears so quickly, time is always their most constrained resource. These tools allow us to get essential insights and direct our management time elsewhere.
What do you consider to be the main marketing trends for multifamily communities?
Keinert: Self-guided tours are here to stay. Five years ago, if someone told us that we would have prospects tour themselves and not spend in-person time with a leasing agent, we would have laughed. Prospects will continue to demand more from their apartment shopping experience. Companies that make the experience seamless will be the winners.
A lot of questions remain, though. We are figuring out if we need a technology solution to offer a 100 percent self-guided tour or if our office teams can provide a hybrid approach. We’re going to rely on feedback from our prospects to guide us forward here.
What are some of the key amenities an apartment community shouldn’t lack in 2021?
Keinert: The amenity race has been interesting to watch over the past few years. Until the pandemic, it’s been all about who has the most extensive, most extravagant amenity spaces. This market has seen it all, from golf simulators to show kitchens and dog spas to bike repair rooms.
The interesting thing is that the pandemic essentially took away all of our amenities during our state-imposed lockdowns. We were left with selling four walls and a roof to our prospects. I really think the properties with a top-notch team outperformed the rest. Today’s constrained labor market makes great employees worth their weight in gold. They can provide a more significant return on investment than any rock-climbing wall could ever offer.
So for 2021 my must-have amenity is excellent service. It really sets communities apart. Prospects and residents will forget your fitness room, but they won’t forget how you made them feel.
How do you see the future of the rental market in Minneapolis-St. Paul?
Keinert: The change of the year brought peak season traffic levels to us in January, February and March. We made up more ground in those three months than we ever have before.
The one great thing about Minnesota is that we are always full of optimism after our long, cold winter melts away into spring. Many markets have already rebounded, while many others, including some of our urban markets, show promising trends. We’ve only just begun and are moving into our traditional new lease-up season, with a good number of deliveries planned in the area.
Even with my Minnesotan optimism, we have some hurdles to overcome this year. A looming end to our eviction moratorium may expose unplanned availability in the market. And rent control measures might land on the ballots in Minneapolis and St. Paul later this year. Regardless, the Twin Cities are full of plenty of multifamily professionals prepared for whatever 2021 throws our way.