Centralization of Multifamily Leases: Preferences & Playbooks

Estimated read time 6 min read

When we consider the various ways to centralize leasing activities, it is important to keep in mind that the goals of leasing are paramount. It is to sign leases. To get to that point, leasing teams have to process a lot of inquiries. But only a small percentage will convert.

In the United States, multifamily communities have a turnover rate of nearly 50%. Filling these units requires a lot of work. The conversion rate for a multifamily building is typically between 5% and 9%. For every 100 leads, maybe nine will lead to a lease. This is why leasing efforts are focused on identifying the best leads.

In order to provide effective leasing, it is important to balance the prioritization of leads with service delivery. To provide consistent service, leasing teams must handle each inquiry in the same manner. Prioritizing leads is a great way to use information about the source of the lead, how they found it, and when they want to move. The leasing team will miss out on identifying the most valuable leads if they fail to triangulate these three factors. Companies rarely have a structured method of analyzing leads. This means their leasing strategies don’t prioritize the most important calls. This presents an opportunity to most operators.

Playbooks: The Importance of Playbooks

To organize centralized leasing, you need a leasing playbook. This is a collection of strategies and processes that ensures associates are taking the correct action with the customer at the appropriate time. The goal is to find the lead that has the greatest chance of conversion, while the process is how teams should proceed to convert the lead.

Two prospects arrive on a Saturday. One tells an associate they have to leave their current home within 48 hours. The other says they cannot move in until a month later. The associate is guided by a playbook to give priority to the lead with the 48-hour window to move in, since they are more likely than the other to convert.

The systems and processes we create in the multifamily sector do not typically separate leads into different types. When trying to convert leads into leases, many companies use a “one-size-fits all” approach. A playbook that prioritizes leads allows for a new set of interactions and increases your chances of achieving your goal.

Your Playbook Needs

We have already covered the importance of high-probability lead identification and how it can help you convert a potential lease into a real deal. There are still a few more essential elements to include in your playbook.

The playbook should address the entire leasing life cycle and the level of engagement of prospects at each stage. The directions must be specific enough to guarantee consistency in execution from lead to lease, and that each step of the process is assigned to the appropriate team member. This dynamic is especially important as the number of activities shared between the property and central resources increases. We can now focus on prospects, rental history, and which properties they’ve already visited.

Playbooks should also focus on cross-selling properties. When a prospect decides to not lease a property they have seen, they may accept a tour of another one. The leasing playbook must now include a section on cross-selling.

The leasing team must work with a platform that puts the prospect, not the community, at the heart of the process. Data structures and technology centered on prospects are essential to enable leasing associates work anywhere via any communication channel. Structure and organization of data supporting the central process is vital as it can either limit or enable your leasing strategy.

Once all these elements have been included in the Playbook, it will be necessary to implement digital methods of collecting data and ensuring that the actions in the Playbook are completed. Centralizing data into a digital environment has the advantage of giving us a better view of the entire sales process. This trackability allows us to identify weaknesses, risks, and opportunities within the leasing pipeline. It must therefore be at the heart of the technology.

Philosophical question: How much automation?

The last aspect of the playbook is how much automation are we willing to accept in our central leasing function, and in particular the extent that the property supports self-guided tour. We assume that when it comes to automated services or automation, companies will have different levels of acceptance based on their risk-reward perception.

Some companies are willing to risk everything to automate, even if it means falling off the edge of the cliff. Operators may use as many tools possible to encourage self-guided tours, and they will probably embrace the maximum degree of automation.

A high level of automation can make many operators uncomfortable. This could be for a variety of reasons. Some operators may be concerned that their customers’ experience will suffer, or they may doubt the return on investment. The ability to increase the level of automation, and to centralize easily is crucial to the design of the playbook.

Most companies are likely to fall somewhere between the two extremes of this automation spectrum. These companies will be focused on improving both the net operating income as well as customer experience. It is important to be open to changing the way you interact with your customers but to not sacrifice their ability to speak to a person when they want to.

This post teaches us that there is no one-size-fits-all solution. Centralization can be done in many different ways, each with its own advantages and disadvantages. The technologies used by these companies are the same, regardless of whether they take it slowly or all at once.

Even if companies are only taking small steps in this direction, it is important to know how the technology will work at the end of the day and devote time to designing a thoughtful operating playbook. This is how people can make the best decisions for their company’s long-term success and customer experience.

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