Handling the Package Delivery Challenge

As millions of packages were making their way to their final destinations this holiday season, delivery companies and USPS were not the only ones wading through the package deluge. Apartment communities were charged with holding and handing-off packages to more than 39 million apartment residents.

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Rick Haughey

But it was not just gifts that were arriving. Americans are shopping online and for many it is their preferred mode of consumption. To better understand how apartments are dealing with the dramatic rise in deliveries, NMHC and Kingsley Associates recently partnered on a new Package Delivery Survey. The new study includes responses from more than 2,000 community managers from 29 industry-leading multifamily firms across 44 states. It also provides an update to a 2014 package survey and complements data from the most recent NMHC/Kingsley Associates Renter Preferences Survey.

Packages Pile Up

Package deliveries to multifamily buildings continue to grow. In fact, 61 percent of community managers report that package deliveries have increased year over year. For the average apartment community, that’s roughly 150 packages per week delivered to their door. However, that number jumps to an average of 270 packages per week during the holidays—that’s an 81 percent increase during peak package season.

While most apartment buildings (77 percent) now have a dedicated space for package storage, some  property managers say their buildings’ package storage solution are inadequate, especially during high volume periods. To further complicate the matter, packages are becoming more difficult to store with residents ordering heavy, oversized and perishable items.

Managing the Volume

Apartment managers are turning to a variety of solutions to notify residents and deliver packages. The majority of managers (57 percent) say that self-serve package lockers are the best way to handle package deliveries, as packages remain secure and residents can pick them up at their convenience. Yet, less than half of those respondents actually used package lockers. More managers report that they mostly hold packages at the management office or in a non-resident accessible room.

While package lockers are the preferred package solution among community managers, there are hurdles to making them work. The top three reasons community managers say they don’t have a package locker solution are: They are too costly (33 percent), there’s not enough space on site to install them (25 percent) and there isn’t a good location for them (22 percent).

Part of the reason solutions like package lockers are so desirable among community managers is not only that they provide convenient, on-demand access to packages for residents, but the systems also handle resident notifications. The survey data shows that the industry is making a rapid conversion to more electronic notifications with 45 percent of respondents using some kind of package check-in system to alert residents by email or text when packages arrive. However, some communities are still providing high-touch notifications like leaving delivery notices on residents’ doors (6 percent) or calling residents (18 percent).

Regardless of the method of management, this responsibility requires staff time. Sixty-eight percent of community managers say they typically spend between one and four hours per week managing packages.

What’s in the Box?

According to data from NMHC/Kingsley’s renter preferences survey, apartment residents are ordering all kinds of things, including non-standard delivery items that can pose additional management challenges for on-site staff.

For example, more than three-quarters (76 percent) say they are ordering high-value items that requires a signature. Seventy percent say they are ordering heavy and oversized items like furniture, rugs, exercise/recreational equipment and the like. These deliveries aren’t typically happening every week, fortunately, but they are happening once every month or couple of months.

Also noteworthy is that 42 percent of residents say they order perishables. Grocery delivery is expected to be an area of increased growth between food subscription boxes and online grocery deliveries. A recent Forbes article from January reported that online grocery sales are predicted to capture 20 percent of total grocery retail by 2025, reaching about $100 billion in sales. This is, of course, driven by companies Instacart, Walmart’s Jet and Amazon with its purchase of Whole Foods.

The data also shows that 20 percent of those folks ordering perishables are receiving them at least once a week or more.

Bigger Than the Locker

There are many implications, because clearly a couch isn’t going to fit in a package locker and perishables need to stay cool. And apartment communities are responding to these trends. For example, 85 percent of community managers say that they have secure package storage with roughly half indicating they have either camera systems (58 percent) or controlled-access touch screens (50 percent). Similarly, while just 4 percent of community managers indicated they had refrigerated lockers, of those who did, 43 percent indicate they are used daily.

However, unusual and oversized items remain problematic to some degree. More than half (52 percent) of community managers report that they often hold them for safe-keeping in the management office, about a third (32 percent) will delivery them to the residents’ door, and less than a quarter (22 percent) stash them in a separate storage area.

Beyond common bulk items like mattresses, rugs and furniture, community managers report receiving car parts like snow tires, exhaust systems and even entire vehicle rear ends; live animals, including insects, small rodents and even a rooster; and other miscellaneous items such as boats, swords, and mannequin heads. One community manager even received a box of pig flesh on behalf of a resident that was a budding tattoo artist.

It’s clear that how people shop has evolved significantly in recent years and will continue to do so as online shopping becomes a larger share of all retail sales. As a result, the multifamily industry is challenged to find new and creative ways to meet the demand for package storage, sorting and security. Finding and using the right technology solution while managing the costs for handling the growing volume of package deliveries will be important considerations for multifamily firms going forward.

Rick Haughey is vice president of technology initiatives at the National Multifamily Housing Council (NMHC) in Washington, D.C.

Read the CPE-MHN Guide to 2019.