00:13 – T. Tran
Hey guys, welcome to Multifamily Manager Pro. T, Chris, and Skylar here with you today. I think one of the things we want to talk about is amenities and what kinds of amenities and how can some of these amenities either help or hurt your property. One of the things that we’ve been talking about a lot and have actually implemented in some of our properties is bulk internet. Definitely pros and cons to both. And we’re going to talk about kind of the back-of-house pros and cons, and I think the front-of-house operational as well, tenant relations, and things like that. Guys, do we want to dive in? What do we like about bulk internet? Well, first of all, let’s talk about what is the difference between bulk internet and managed Wi-Fi. Bulk internet is actually for the individual unit. So that’s a package deal that’s coming to the property, but it’s wired to each unit individually. The managed Wi-Fi is actually community-wide. The bulk internet is definitely where we’re talking about the additional revenue lines and quality of service that tenants are getting. And so obviously one of the biggest points, which is the revenue generators. So Foti, you’re our back-of-house guy. You do all of our books. How do you see that affecting our portfolio right now?
01:33 – Chris Foti
Well, I think it’s probably one of the best line items that we have when it comes to other revenue opportunities. In addition to that, it’s something that’s becoming, I think, more and more expected. A few years ago, it was probably something that could have been seen as just sort of an upgrade to a property. But even these days, when we’re hearing people doing showing appointments, they are asking like, ‘Is there an internet package included?’ And it’s just a great way to add more revenue to any project. And what I like about it is it’s a win-win. It’s a great thing for us as property managers and ownership to see that additional income come in, but it’s also better for the residents because they’re actually paying less than they would pay if they were to go set up internet service on their own, and then to make that even better when it’s an even better service than what they are getting from third-party internet provider-it’s just a win-win. So it’s cheaper for them, it’s a better service, and it actually makes ownership money on our side by having control over that. How we see it affected is major, and obviously depending on the number of doors and how you’re setting your pricing, I think we’re going to go more into selecting like like the right vendor for this type of thing, because that can affect your pricing and how that translates to what you’re making each month. It’s a great revenue line, if not the best one, I think that we have.
02:43 – T. Tran
So I love having all three of us on. And the reason is, I think you guys will start to see this more and more as we talk through a lot of different issues and things is. Our perspective on all of these things are really different. So again, Chris having the background, the accounting, and looking at these revenue lines and things like that. Skylar having the front of house, the tenant experience, and the actual live feedback. What I actually look at is why and how do we implement these kinds of things? So for me, the things I looked at was what is the actual product, right? Because we had a property that we were using one of the big box names. They said, ‘Oh, yes, we can do bulk internet for your tenant.’ And it sucked. And the reason it sucked was the service was not great. Right. Speed was not great. And any time there was actually an issue, it suddenly became Skylar’s issue. Skylar all of a sudden had to fix the Internet. It was Skylar’s fault that it was down. So it was very time-intensive. And I was like, this is actually not a generating as much revenue. The cost-share was not that great for us. And then B, it was now sucking away time from our management. It was causing issues. And so I was like, we’ve got to just get rid of this. This is not working. So I was shopping around and doing some things, and found a local company that was actually able to provide a way better quality and speed. And they actually had their own customer service department. It wasn’t just now you’re calling one of these huge call centers and you’re on hold and all this stuff, or you’re banging down the manager’s door trying to figure out what’s wrong with your net. You actually had a 1-800 number that was local, US, could talk to someone, and they could actually troubleshoot remotely. I think that one of the things that people need to look at in your area, if you guys are looking at these things, or if you’re even already with one of these big box names, is actually try and find a local source because the feedback that I see kind of nationwide is, yeah, it’s a great idea, but it becomes our problem. There’s been a couple of us who’ve been able to find that local source. It’s, I think, worked out better. From top to bottom, I mean, for me, operationally, it makes sense. The cost share is great. And I think Skylar, after we made that conversion on that one property, how we got pretty instant feedback on that, right?
04:57 – Skyler Vanderwell
We did a bit relieving as well. We did actually have a resident who did work for one of the big box names to kind of further that point too, is, is this something that is going to help or hurt your community? And again, coming from day-to-day operations, again, my priority is going to be the tenant experience, right? That is generally where I like to hone my focus. So getting that positive feedback that we went with a company that not only that made sense for us operationally in terms of a revenue-generating line item, but also that it was a product or service, it was a value add to residents and not something, not some unscrupulous service in which we are just trying to generate revenue. Residents see it as just another way for us as management to make money operationally. That’s the key difference. I feel that it’s important that these products or services; it can be a tremendous benefit or it could be something that winds up being an absolute nightmare for day-to-day operations. Again, as you said, we had one of those big box names. It wasn’t anything that we were seeing value in. It wasn’t anything that residents were seeing value in. But once we did a little more homework and did some research, and found a company that shared in what we were trying to provide as far as resident experience. And also at the end of the day, we are looking for other avenues to generate revenue, but also that ties directly to resident experience.
06:23 – T. Tran
Internet is a necessity now, right? I mean, I think we can all safely say that. You’re right, Valerie. I don’t think it’s just some little like, oh, here’s our fitness center. Some of these things that we always offer, they don’t get utilized that well. But I would say that, Chris, I think we’ve got a hefty amount of our tenants that work remotely.
06:42 – Chris Foti
We do. I think it’s a big thing. And to your guys’ point on the internet, it’s one thing that you don’t want to mess up. You don’t want to have a mediocre internet service in your community. And you’re trying to provide bulk internet. And it’s something that people are having trouble with. It’s going to cause so many problems for your team. It’s going to cause problems for the residents. It’s something that everybody kind of expects to work good. And unfortunately, a lot of the big names don’t have that capability. Not so much like they don’t know how to do internet, but when it comes to larger apartment buildings or communities, there’s just a lot of moving pieces there. I mean, we need internet a lot of times for access gates and smart locks and things like that. We’re using it not only for the residents, but also to operate the community. It’s important that that’s done right. If you’re going to do it, do it right. Definitely look into some different options. Yes, a lot of people are doing work from home. So they’re using the internet often. The other thing I’ll say when it comes to like looking at different vendors that provide this locally, there are other services that can be packaged with your internet. We found at least one great option in our area where it’s like there are smart tech options and things that can kind of work with the internet systems that they’re putting in. So you have different options and different ways, I think, to provide different levels of services depending on what you want for the community. Yeah.
07:50 – T. Tran
Next time, I definitely want to get into the smart home tech that we’re seeing out there with not just the electronic door locks, but with your thermostats and lighting and stuff. So that’s a good one that we’ll definitely dive into. The one thing I would say, though, guys, is this is something that’s happening all across the country. And again, in your area, there are a few options. And I will say that one thing that we should be watching is the FCC, because the FCC actually came out and tried to ban this idea of bulk Internet communities. This is live and ongoing. I think the latest was late last year, 24. And basically, the FCC was trying to prevent these unnecessary charges. But the argument for a lot of us in property management, especially when we’re working in areas that maybe aren’t so metropolitan, I mean, they’re not these real dense cities. We’ve got rural areas all throughout our country. And so actually bringing services like this out to these areas that don’t have access is a big deal. I see where the FCC is coming from as far as they want to ensure that apartments communities are not dictating or saying, ‘hey, you have to use this’ one provider because this is the agreement we have. But at the same time, I think that we in the industry need to be paying attention. And this is why you guys have to do your research too, right? We, again, had some trial and error in figuring out which companies were actually able to provide a service and at a good, not just return for us, as Skylar said, you know, having that revenue is nice, but actually a tenant going out on their own, purchasing their own internet plan from one of these other providers is more. We actually are saving these tenants money. So it is a win-win for both, which actually is really nice. We don’t get to see that too often, but it is a really, really nice amenity. It’s important. And again, I think it’s becoming more of a must-have, a necessity. Definitely just some of the things that I look at when we’re shopping these kinds of different products and deciding whether or not we’re introducing something into our communities and into our operations, because paying attention to what’s going on in those is sometimes very tedious, but very important, because if there’s a ban, it’s going to affect all of us. And I think we should all be keeping a pulse on it and speaking up, because it is a very positive thing for not only us in the industry, but for the residents. At the end of the day, we do want to say that we care. We are providing housing for people. And so I think it’s important that we’re as all encompassing as we can be. I know I get to do all the fun infrastructure, legal nonsense. So that’s what I get to do.
10:11 – Chris Foti
Yeah. And the other thing I’ll add is it has become where it’s like expected. So I think anytime that we’re taking on a project, we’re pretty much looking for that to kind of be there already. It is kind of a surprise sometimes when we see like newer projects go up and don’t necessarily have thought about bulk internet yet. If you have the opportunity to think about this in the early stages, right? So, like if you’re getting ready to go through construction and you guys are talking about plans and stuff, I think that’s the best point to start thinking about bulk internet, even though there are ways if you’re taking on a property already built. It’s been operating for years already. There are ways to implement it. So, you would agree that it’s most easy to implement from the very beginning. And it certainly should be thought of like during that process.
10:51 – T. Tran
Yeah. Construction is definitely its own animal. And unfortunately, a lot of the times as property managers, we don’t get a say. They bring us on when the project’s done. There are a lot of developers who start the consulting process in the beginning. So if you guys are fortunate enough to be in that kind of position, for sure, think about those. Because if you have the opportunity for them, management down the road, you want to make sure that you’re creating something that’s going to be as easy as possible on yourself and your staff to actually manage and run, right? So it is nice being on really early in the game to be able to say, hey, these are things that we can do and get wired in the building before instead of having to retrofit afterwards. But it’s definitely a possibility. And the numbers usually still make sense, even if you do have to retrofit afterwards.
11:34 – Chris Foti
Yeah. And you have full control over those numbers in most cases, right? There’ll be a deal that you work out with the provider. It’ll cost you so much per door. And then you can kind of set your pricing, what you’re charging residents on your own. And when you’re doing that, you can either price it as just internet or if you have other things that go with it, it could be like a smart tag package, anyway that you want to kind of structure that that makes sense to your business or your community and residents, there’s a lot of different ways you can structure it for it to make sense, yeah.
12:00 – T. Tran
For sure. Just kind of an ongoing conversation. We’re going to start seeing that more and more. Skylar, you hear it on tours. They’re asking, what kind of internet service are you guys providing? I think it’s really important that we’re all paying attention to that and just keep moving with the time. Well, if anyone ever has any questions or they’re curious about what’s available in their area and need any help, feel free to reach out to us and we will see you all next time.
