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Accelerated evolution

How COVID-19 hastened technology adoption in property management

By John Salustri
Elevators Inside Modern Office Building

“The pandemic hasn’t changed life as much as it has accelerated the speed of changes already taking place.”

So says Pepe Gutiérrez, CPM, founder of Megafincas Alicante S.L., a manager of 187 condominium properties, based in Alicante, Spain. That the COVID-19 pandemic didn’t change life might seem an odd thought, given its degree of massive and ongoing disruption.

But Gutiérrez is right. For many property managers, especially those we spoke with for this article, COVID-19 was an accelerator of changes—in particular, technological changes—that had already rooted themselves in the operations of their companies. “Changes that would otherwise have taken 10 years happened in 10 days,” he says.

Ted Brownfield, CPM, chief operating officer at Washington D.C.-based SJG Properties, agrees. “A lot of companies have been pushing in the last three months to pivot toward technologies such as electronic payments and leasing,” says the manager of just under 1 million square feet of mixed-use assets throughout the Washington D.C. area. “We had already been working on implementing all of these strategies before this happened, so SJG was really in a good place.”

Tech seeds planted years ago, he says, took serious root in the first half of 2020. “We’ve put greater focus on the video tours we were already doing, and we’ve gone totally toward electronic leasing only.” The firm is now fully portal-enabled, wherein tenants and residents can submit payments and work orders, which, for many routine maintenance requests, can often be handled by video tutorials, thereby limiting person-to-person contact. “We have a growing library of videos on how to use appliances and how to program thermostats, as well as how to replace filters and the like.”

Ted Brownfield, CPM, SJG Properties

Health and safety were an issue long before March—really part of Property Management 101, explains Sharon Hart, CPM, an account director with Cushman & Wakefield, AMO. “Health and safety are always paramount in any commercial setting,” says Hart, who is president of the IREM Greater New York Chapter. “There are so many things going on in a building that have to happen to maintain its health—things that pertain to air filtration, water testing and chiller cleaning. We had all of those protocols already in place.”

That preparedness was due in part to Cushman & Wakefield’s upfront diligence in assessing the needs of the buildings it manages as well as to the expectations of ownership. In Hart’s case, that meant New York Life, which owns and is a 60% occupant in the Madison Avenue building that bears its name.

The pandemic clearly accelerated adoption at SJG and, Brownfield says, “it has gotten some people on board who were reluctant to use a lot of the technology before.” Those people, he says, are mostly residents, although he admits that maintenance teams were also originally reluctant to fully embrace certain tech advancements, such as the do-it-yourself work-order videos and FaceTime tutorials.

“These were both proven timesavers,” says Brownfield. “Our in-house maintenance teams have come to embrace them, especially since easily half the work orders that come in can be diagnosed remotely with FaceTime, a video and some pictures.” This compares favorably to the need to make a house call, diagnose the problem at hand, fetch tools and equipment and then return to the occupant to perform the fix. “It’s a great time-management tool.”

He who hesitates is saved

While workers hunkered down at home during the crisis, tech vendors with all sorts of gee-whiz solutions seemed to come out of the woodwork. “We’re getting inundated with people coming to market with building technologies,” says Hart. “Many make amazing claims that, for instance, if you put UV lighting in your HVAC system, you’ll neutralize the spread of COVID-19. But that hasn’t been proven yet, or that ionization will eliminate the coronavirus. Nor have they proven that it’s not horrible for the environment.”

Sharon Hart, CPM, Cushman & Wakefield, AMO

The result, she says, is a “wait-and-see” attitude. “We have a lot of in-house experts in many of these areas who can provide a lot of guidance, and we want our clients to know what’s legitimate. We’ll tell our clients to look at the applications and products that we know are working.”

Among those are new elevator technologies that allow for hands-free queueing. Hart says it has been tested in the field by one of Cushman & Wakefield’s major institutional clients. But it comes with downsides, including the need to integrate with lobby turnstiles and other security protocols. Partially for that reason, implementation will take another three or four months. “In a newer building you could probably implement the system more quickly,” says Hart, who manages the New York Life Building, a 1928 vintage landmark property.

But a wait-and-see approach to new technologies is different than tech aversion, and the Cushman & Wakefield team is also seeing traditional hesitations melt away. “People are getting comfortable leveraging technology,” says Bryan Berthold, Cushman & Wakefield’s global lead of workplace experience. “We do a lot of surveys, and during the pandemic, we found everyone was as productive as before, and collaboration went up 10%.”

He says that users and team members alike are starting to embrace new technologies for what they were originally meant to do: enable mobility. This is especially true in operations where work-from-home policies were more limiting than flexible. “Now, the new normal is, ‘Convince me why I shouldn’t work from home.’”

Communications first

If there was any doubt before March, the importance of timely, informative and accurate communication with occupants and staff has become clear. Gee-whiz tools are great, but even if the application is low-tech, such as simple email, the change here comes in the elevated importance of any communication. The keywords are “clear” and “regular.”

“We started to produce regular COVID-19 newsletters to keep people up to date with practices we will be implementing and what’s happening in the community,” says Brownfield. “That’s been a big change, too. Prior to COVID-19, tenants would usually stop by the desk for packages and to talk. We disseminated a lot of our information this way and prided ourselves on this more intimate style. The focus going forward is going to be on regular updates using vlogs, our community portal bulletin boards and other digital media. Our focus is still on personalized service, but we want to make it easier for our clients to not have face-to-face interaction if they don’t want it.”

Pepe Gutiérrez, CPM, Megafincas Alicante S.L.

For Gutiérrez, the main means of communication have been email and WhatsApp—not the first name in communication in the U.S., but in Spain, “95% of the people use it,” he reports. That has resulted in greater awareness among his building occupants of the coronavirus risks. “Before the pandemic, we had 60% or 70% of our residents’ necessary emergency phone numbers. Now we’re closer to 95%. People understood that with no phone or email, there was no communication.”

“Before we manage a building, we’ll do a once-over and talk with ownership about what makes that building work and how we can make it healthier, more productive and more energy-efficient,” says Hart. It’s a conversation that never stops. Even after an agreement is signed, “We ask what more we can do in terms of sharing information and knowledge about the building, which comes down to signage, properly placed email communication and webinars with our tenants as well as with our employees,” she says.

Shifting responsibilities

To a great extent, it seems that the COVID-19 pandemic not only accelerated the rate of high-tech (and even low-tech) adoption, but it also secured technology’s position in the strategies of property managers going forward. In short, tech aversion is evaporating. This is a particular area of interest for Gutiérrez, who is on the last leg of a master’s program in data science at the IE Business School of Madrid University.

Bryan Berthold, Cushman & Wakefield, AMO

He refers readers to the website willrobotstakemyjob.com. The site, which extracted data from a 2013 report that examines the probability of computerization for over 700 occupations in the U.S., states there’s an 81% likelihood that current functions for property, real estate and community association managers will be automated.

“It’s highly likely that this occupation will be replaced by robots/AI,” the site states. “However, workers may be able to take some comfort in the results from our [reader] poll, which shows a 29% chance of automation within the next two decades.”

Gutiérrez disagrees. “Machine-to-machine communications is the future,” he says. “But it’s happening now,” with measurable results. He tells of a conversation with the CEO of a major global insurance company who told him: “If you have Internet of Things sensors in your building, you will pay maybe 20% less in the cost of insurance than a building without. You’re minimizing the risk of fire or water damage.”

He uses his own firm as an example of the efficiencies that will come with AI and machine learning: “We manage 12,000 units with 12 people in the company, and four are IT people.”

And for Hart, some are robots. “I wanted them in the building to help clean corridor areas, so housekeeping can focus on more of the high-touch cleaning,” she says. “Of course, it’s not a cheap option, so there was some hesitation.”

Notice she said “was,” as in before the pandemic. “When this hit, they couldn’t wait to pay for them,” Hart says. She adds that there is a potential payback model in such advancements as robotics and elevator upgrades. “But from my client’s standpoint, it’s worth it to keep their employees more comfortable about the process of returning to that corporate office.”

Gutiérrez agrees, and he says that a large chunk of company profits return to the business, specifically for new tech. “We want people to know they’re in the right hands,” he says. “It’s a question of loyalty.”

“In one sense, robot and AI technology might be a luxury,” says Berthold, “but it’s vital to monitor such things as knowing where people are, when they’re leaving and making sure everything is properly sanitized. A lot of the new developments in work environment technology platforms have just gotten a new prioritization from our entire client base.”

Hart admits that, given the rapid onset of the coronavirus, everyone had to think on their feet, and there was a lot of backroom hand-wringing to get things accomplished—things like ensuring remote workers around the globe were supported by a robust infrastructure. To paraphrase an old slogan, the trick was to never let them see you sweat.

“It all has to look seamless,” she says. “Everyone can look good in good times. When there’s a challenge, the companies that can rise to that challenge will be marketable after the fact.”

That marketability, she concludes, more than ever, revolves around technology.

The Pain in Spain
Among COVID-19-infected countries, Spain ranks ninth for number of reported cases by Statista.com.

But relatively lower numbers don’t imply straightforward responses. Pepe Gutiérrez, CPM, reports that implementing new procedures and protocols was a particular challenge. “In the 100 days we have been in lockdown, more than 20 new laws came out about the pandemic. With every single Saturday came a new law, so we had to work weekends trying to understand how to respond to these new and changing laws.”

This was especially difficult because the first set of governmental restrictions did not recognize property management as an essential business, he says, nor was there any initial guidance as to the management of residential properties. While that would come later, Gutiérrez says in the meantime his firm was focused on, “trying to do the right thing in the right way in the right moment.”

The only skill available to them in those early days of the pandemic wasn’t technological but interpretive. “We needed to do major interpretations about the laws and how they would affect us. And it all needed to be done yesterday because there was no time to react.”

the Journal of Property Management staff

John Salustri is a contributing writer for JPM.

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Accelerated evolution

How COVID-19 hastened technology adoption in property management