It's December, which is the time of the year when I have the absolute pleasure of sitting down for 20 in-depth conversations with multifamily executives. For those unfamiliar with 20for20, it's an annual survey where 20 leaders (ten heads of operations and ten heads of technology) from leading multifamily companies share their thoughts on the year that is ending and the year to come.
2024 will be the sixth annual edition of 20for20. The survey changes somewhat each year to ensure the conversations focus on whatever is top of mind in our industry. Regular readers of this blog will recognize several of this year's themes as they have been developing stories during 2023. But to preview what we can expect when the new results come out early next year, below are the main topics the 20 participants in this year's survey will be talking about.
How Operators Buy Technology
This subject is close to my heart. I'm interested in knowing what, if anything, has changed about the way that people research and purchase technology. A year ago, leaders predicted 2023 would see a pivot to profitability as the deal pipeline slowed. That would mean a much sharper eye on the technologies we consider adding to our platforms. I'm curious to know if that has come to pass and what, if anything, has changed about the way that people buy technology and, more broadly, think about their technology stack.
The State of AI
Earlier this year, it seemed that AI was about to revolutionize everything in our industry. It hasn't quite come to pass, although AI offers revolutionary potential and could transform operations to a greater extent than any other technology. What I want to know is how people are thinking about it. For example, is there evidence of overarching strategies, or is it more like what I noticed in last year's 20for20, i.e., that companies were mostly looking for AI facsimiles of individual processes with which they are already familiar?
For a few years, I have been noticing that property technologies (i.e., technologies that require installation at properties) are subject to different decision-making processes compared to enterprise technologies. Obvious examples include the increasingly important selection of internet providers and smart technology solutions like access control, thermostats, and so on. As usual, the objective of 20for20 is to find out what's going on, but in particular, I want to know what involvement the leaders I speak to have in the decision-making process. I discussed this matter at length in a Thesis Driven post a week ago.
As I have mentioned elsewhere, short-term rentals (STRs) have been having a moment in 2023. There is evidence that the sector has restarted after a COVID-enforced pause, and the business models now look more robust and compelling than the previous iteration. Now is a good time to take stock of what these 20 leaders think about STRs and, in particular, where they see the opportunity.
Some look to, e.g., Airbnb Friendly Apartments as a way to make 12-month unfurnished leasing more affordable. Others are compelled by the lease arbitrage model that enables companies to diversify and de-risk their revenues by opening up to different types of renters. Pre-COVID editions of 20for20 observed that most operators viewed STRs as a solution to an occupancy problem, and since few operators were worried about vacancy, STRs were not a priority. I expect a different perspective today.
Data and Analytics
Perhaps the most interesting thing about revenue management, business intelligence, and so on at the moment lies in the economic conditions our industry faces. We know that the prevailing macroeconomic conditions have changed, and we also know that we are facing record delivery of new product into many markets. Concessions have and will continue to go up in markets where the new inventory represents a high proportion of total inventory. The question is, what are companies doing differently, given how different the market is?
Finally, the meatiest part of this year's interviews will, unsurprisingly, be centralization. 20for20 has been tracking sentiment and progress on centralization for several years now, and we will be seizing this opportunity to develop a detailed progress report on what people are doing. This year, there's an additional twist: Last year's survey demonstrated that people have been thinking about this to a greater extent than they had previously. One year on, we invite leaders to speculate on the realistic end-states for centralized leasing, admin and maintenance. It's a different question from the ones we've asked before, and I can't wait to find out what people say.
That's what will keep me busy for the next couple of weeks. I am fortunate in that every year, between December and January, I get to go back to school. And by the time we emerge with a finished survey for publication in February, we have a great read on what's happening and, in particular, what's changing in our industry. Keep an eye on these pages for more as this year's issue takes shape.
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