With an economic downturnlooming, the market is poised to shift in favor ofbuyers and renters. To navigate the changing commercialreal estate market, your residentialproperty management company must embrace technology and efficientlymanage its costs and working capital. That starts with streamliningback-office operations.

The Demand for Digitization

COVID-19, combined with ademographic shift, has increased the demand for everyday digitaltools. An increasingly large share of tenants are young people—andthey expect:

• Information in a singlelocation, not through mail,phone calls or multiple logins.
• Electronic and mobiledocuments, such as leasingapplications, renewals and cancellations.
• Modern paymentmethods, including electronic,mobile and real-time payments and refunds.

Common Challenges Across Property Management Companies

Meeting these requests may bedifficult for management companies, which operate in silos createdby a decades-long history of organic growth andacquisitions-related expansion. The resulting piecemeal legacyplatforms, antiquated processes and "we've always done it that way"mentality makes it difficult to introduce innovative digitalsolutions. 

• Time-consuming paper processesincrease costs and the risk of fraud 

Many management companies usepaper for everything from leasing applications to vendor invoices.These manual processes require more staff members and consume timeand money that could be spent developing innovative solutions. Theyalso put companies at a higher risk for internal and externalfraud.

• Relationships and accounts at multiple banks can triggerhigher bank fees.

Oftentimes your managementcompany uses separate accounts outside of their primary bank. Thoseaccounts multiply, as do bank fees, when you consider accountsreceivable, accounts payable and payroll.

• Poorly implemented technology can cause processinefficiencies. 

Without the necessarycustomization, modules and integration, newly implemented systemsmay cause more problems. Because the technology may not be properlyutilized, the business may question its investment and avoid futureones.

• Incomplete forecasting and reporting can increase the riskof falling behind competitors.

Manually compiled, incompleteinputs are less reliable, making your true cash requirements andfunds available for investments unclear. This dearth of dataanalysis-based insights on things like tenant behavior put you at adisadvantage. 

• Advocating for solutions is more difficult without atreasury team or formal key performance indicators (KPIs).

Companies that lack a designatedtreasury team often lack KPIs, not only across treasury, but alsoaccounts payable and receivable teams. Without a dedicated treasuryteam, building the business case for an end-to-end solution can bedifficult.

Streamlining Operations to Create Efficiencies

Your company may be hesitant tochange. However, if you don't upgrade your back office, your frontoffice and growth could suffer.