Managing Partner, CHARLESGATE | Real Estate insights for forward-thinking developers, investors, and owners | Inc. 5000 Fastest-growing companies in U.S. | BBJ 40 Under 40
Far too many multifamily insiders simply don't 'get it'. In so many of my conversations with industry insiders (developers, investors, lenders, appraisers, operators), it's become abundantly clear that there's still far too much legacy thinking. It's insidiously ingrained in the way we design, the way we finance, and the way we operate multifamily. - It's costing owners and investors too much cash. - It's providing a worse living experience for residents. - It's creating a bad work environment for property employees. Almost to 2025, it's well past time to modernize the way multifamily is developed and operated. This means transforming the way multifamily does business (here are a few ways, in no particular order): 1. Jack-of-all-trades property managers >>>>> Functional roles and specialization 2. Status quo "spreadsheet-first" underwriting (with virtually the same assumptions in every model) >>>>> Setting a vision and designing a business plan to achieve that particular vision 3. Lowest paid, entry-level assistant managers as "leasing specialists" >>>>> professionalize leasing as a centralized sales team 4. Half measure "centralization" >>>>> Functional operating org design with centralizing and regionalizing, but only the right functions 5. Institutional capital focused only on larger properties >>>>> Mid-market & infill properties operated at scale as regional portfolios 6. Spray and pray marketing >>>>> Invest in a real revenue function (strategic leasing+marketing) Good news is, there are some positive glimpses of change happening. And we're pushing hard to be on the forefront of this transformation at CHARLESGATE.
You have it nailed! Centralization is key to a lean, mean, business. One of the easiest and most effective steps is the finance end of the operation. Centralizing the AP side from inbound invoice data collection with intelligent data capture technology that virtually eliminates human errors to seamless transfer of that invoice data through various detection methods for errors into the PropTech / ERP system of your choice, to customized approvals for your various assets and personnel with and without payment threshold all the way to payment drives efficiency, mitigates fraud, and reduces costs. Best of all - you can introduce all these improvements and in many cases actually create a new monthly recurring revenue stream (ie cash flow) from your monthly spend if you are talking to the right people 😉
Say it again louder for the people in the back, Michael! Each of these resonates in such a deep way, and I have seen some combination of these in every role, with every company that I've had in multifamily and SFR. Legacy thinking is killing companies' current performance & actual legacies.
It’s been great following along. It’s tough being ahead of the curve sometimes. Keep pushing your message - many people will benefit.
Week after week it’s the same conversations and same challenges in new conversations - often originating in old ways thinking. No choice but to educate educate educate…
3 could even be no. 1 - poor leasing impacts value big time. And 5 is a huge trend as well, we are seeing more and more of it.
You raise a very important point. What do you think is needed to drive these changes forward on a broader scale within the industry?
The traditional “spreadsheet-first” mindset has held back innovation for years!!
President @ KimmyMae | Revolutionizing the commercial and multifamily real estate finance industry by integrating cutting-edge AI and automation into lending processes.
11hThis is such a thoughtful perspective, and it highlights how multifamily’s legacy thinking impacts every corner of the industry—from design and operations to financing and investing. On the lending side, we’ve been working at KimmyMae to modernize underwriting and financing processes, moving away from static “spreadsheet-first” assumptions to approaches that are more dynamic, data-driven, and aligned with the unique vision for each property. But this is just one piece of the puzzle. The same level of transformation is needed across the board. Developers and builders can lean into designing properties that better meet today’s resident and workforce needs, while operators and investors can rethink their organizational structures and priorities. It’s going to take collaboration from all sides to fully modernize how multifamily operates. The positive glimpses of change you mentioned are a reminder that progress is possible, and it’s exciting to see leaders across the industry pushing forward. Here’s to 2025 being the year multifamily finally moves from incremental improvements to true transformation—together!