How Multifamily Firms are Leveraging Centralization to Lower Staffing Costs
Mar 31, 2025
How Multifamily Firms are Leveraging Centralization to Lower Staffing Costs
Multifamily operators today face considerable challenges, including rising operational expenses, higher vacancy rates, and managing an influx of newly constructed units. In response, many firms are adopting centralized operations to streamline processes, reduce overhead, and effectively address staffing shortages.
The Growing Trend of Centralization
According to the NMHC & One11 Advisors’ 2024 Multifamily Technology Benchmark Survey, 48.4% of multifamily operators implemented centralization programs in 2023, with another 51.6% planning to adopt this approach in 2024. This demonstrates centralization's growing significance as a cost management and efficiency strategy.
Areas of Centralization Driving Cost Savings
1. Centralized Leasing and Administration
Centralizing leasing and lease administration allows multifamily operators to reduce the need for extensive on-site staffing. This model simplifies administrative processes, enhances scalability, and significantly reduces redundant staffing expenses.
2. Maintenance Operations
Centralized maintenance operations offer substantial potential for cost savings. By consolidating maintenance requests and management into a central hub, multifamily operators can strategically allocate resources, eliminate downtime, and maximize staff productivity across multiple properties.
3. Customer Service and Resident Interactions
Employing centralized call centers and virtual customer service technologies streamlines resident interactions, reducing reliance on on-site personnel while maintaining high-quality customer service. Centralized solutions efficiently handle routine inquiries, allowing on-site teams to focus on essential property management activities.
Leveraging AI for Enhanced Efficiency
Artificial Intelligence (AI) complements centralization by handling routine tasks like collections, tenant inquiries, and administrative duties. AI tools can significantly increase operational efficiency, improve rent collection rates, and minimize staffing needs by automating repetitive tasks and interactions.
Challenges in Centralization and Technology Implementation
While centralization and technological advancements offer significant benefits, operators often encounter several challenges:
Staff resistance to operational changes
Need for comprehensive training and expertise in new technologies
Ensuring new technological solutions align closely with existing operational processes
Strategic Recommendations for Effective Centralization
To successfully implement centralization:
Clearly define operational objectives and desired outcomes from centralization.
Introduce new technologies systematically, paired with strong change management practices.
Continuously provide staff training and ensure technology solutions align seamlessly with operational workflows.
Conclusion
Centralization is increasingly vital for multifamily operators aiming to lower staffing costs and enhance operational efficiency. As the multifamily sector evolves, partnering with specialized recruiting firms like Percy can help operators smoothly navigate centralization, ensuring effective staffing and successful operational transitions.
Inspired by: Altus Group research and reporting ("Get Your Operational House In Order")