It’s that time of year again – time to buckle down and figure out your budgets for 2019. As property teams everywhere dig into the details of what their property management budget looks like next year, it’s common to put blinders on and focus on your existing operating expenses and allocation. Many property teams aren’t actively considering new ideas and projects, like technology, unless they’re unavoidable.
As a result, technology has previously been left out in the cold during budgeting season. More and more, however, property teams are starting to realize the importance of allocating dollars for new technology in their budgets. Technology is playing a bigger and bigger role in building operations and tenant engagement, so if property managers don’t begin considering it during the early stages of budgeting, they risk falling behind as other buildings begin implementing new technology next year.
Here are a few tips to help you evaluate the right technology for your building and fit it into your budget.
Look at Your Challenges
First, look at some of your biggest challenges. Technology is only going to be worth the investment if it solves a real problem in your building, so take a step back and see where your biggest challenges are. Maybe you’re spending a lot of time managing manual processes like tenant billback, or looking for new ways to save energy, or trying to increase tenant engagement with new, flashy amenities. Whatever the challenges are, there are likely technology solutions that are trying to help teams fix them.
Do Your Research
The next step is to do some thorough research. The more knowledgeable you can be as you go into the discussions with your asset manager, the better. This can be intimidating because the world of CRE technology is getting more and more overwhelming by the day as new investments and startups pop up everywhere, but by starting with your specific challenges in mind you’ll be able to focus your search.
If diving into Google and sifting through the options is too intimidating, try looking within your network. Who’s trying to tackle this challenge at their buildings? What interesting technology announcements have you seen from other buildings in your company or network? You’ll likely see some trends arise once you start looking at what others in the industry are doing. It could also unearth some proven technology solutions you didn’t realize existed, which could be good to add to your list!
Do Some Demos, Get Your Bids
Once you’ve identified a few possible technology solutions that could benefit your building, reach out to the companies for one-on-one demos. That’s an opportunity to really dig into the functionality and ask for specifics about how it works with your systems and process nuances. Make sure you get references and actually call them to ask for details about the implementation process. No question is too specific. Every building is a little different and you want to make sure it will work with your setup.
This is also your chance to get multiple bids, so you’ll be able to compare and contrast different options, as well as being able to show your building owner that you did your due diligence.
Look for Possible Offsets
Many technology solutions are designed to offset other costs in your building. Implementing this new technology could save energy, save time, or even increase revenue. If there is quantifiable ROI potential from putting this new technology in place, you might be able to offset the tech budget somewhere else.
Depending on the type of technology you’re looking to implement, you might be able to make it a pass-through or administrative cost to your tenants. Then you don’t need to find dedicated space for it in the property management budget at all. Ask your network, the vendors, and their references how they handled budgeting for the new technology. They will likely have some creative justifications you haven’t considered.
Build Your Case
Now that you have all the information you need, build the case. Be ready for your asset manager’s questions and concerns. Explain how you determined the budget amount, the potential offsets you discovered, and the possible effects the tech could have on tenant satisfaction and retention (which can be more difficult to quantify).
Be prepared to mention the names of other buildings in your market that are implementing new technology to woo new tenants. This will be a potent reminder of how much the war for tenants is heating up. You can even provide the building owner with the references the vendor gave you so they can talk with other buildings personally to get a better picture of the effect the technology could have on the building.
Start the Conversation Early
Finally, make sure you start the conversation early. Budgeting is a long process, and in order to have something in your budget at the end, you’re going to have to make sure you’re planting the seed from the very beginning. Your building owner may push back initially, asking for more information or vetting, which could take time. By starting early you’ll ensure you have the time to get all the information you need to secure the appropriate property management budget for next year.
There’s no doubt that the world of CRE technology is taking off. The buildings that embrace the right new technology will be able to stay ahead of the curve, while the buildings that delay it will find themselves behind the eight ball sooner than they think. Hopefully, these tips will inspire you to jump in and implement some exciting new things in your building in 2019!
If you’re interested in learning more about how Genea’s Overtime HVAC, Submeter Billing and/or Access Control solutions can elevate the functionality and value of your property or portfolio, request a demo.