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The owner-operator’s view on real estate technology

Proptech is creating operational efficiencies and driving returns in the US rental housing sector, says Tricon Capital Group's Jonathan Ellenzweig.

Jonathan Ellenzweig

Q. Proptech disruption – a challenge or opportunity for the real estate sector?

Clearly an opportunity. Technology should allow operators to better serve residents through an enhanced product and service offering. Proptech can also drive returns for investors through increased operating efficiencies. The key to leveraging proptech is looking beyond existing systems, processes and technologies and not being afraid to do things differently or challenge conventional wisdom. In Tricon’s single-family rental business, we’ve reinvented the traditional leasing model, allowing residents to do ‘self-showings’ on their own schedules with digital lock boxes. We’ve received resoundingly positive feedback for this initiative.

Q. To what extent is proptech allowing investors to make better investment decisions?

Proptech allows investors to improve decision-making by expanding access to data and by enabling efficient and accurate analysis of massive amounts of information. Tricon’s proprietary technology allows us to increase our underwriting efficiency for single-family rental acquisitions. Our software can scan online residential listing services and use an algorithm to screen against dozens of acquisition criteria. We can underwrite each home in fewer than five minutes by assessing historical portfolio performance across precise investment metrics allowing for a better-quality portfolio combined with process efficiency.

Q. Is proptech facilitating a more customer-centric investment sector?

It enhances customer experience by providing a broader suite of products and services that simplify people’s lives. At Tricon’s recently completed a state-of-the art high-rise apartment building in Toronto, we offer innovative consumer technology, from smart features in suites to easy-to-use apps that allow for everything from submitting a maintenance request to booking a yoga class in the gym. Residents are thrilled. But companies can become reliant on technology at the expense of personal interaction and a high level of customer service. There’s no substitute for a great concierge to welcome you home every day.

Q. Is there a positive correlation between technology and investment returns? 

It’s opening up new opportunities in real estate where adequate investment returns could not be made in the past. We’ve seen a positive relationship between the use of technology and investment performance and Tricon has numerous examples of how technology has driven operating efficiencies and enhanced investment returns. Tricon’s single-family rental maximization program allows us to toggle between occupancy and rent growth to optimize returns.

Q. What are some examples of Tricon’s use of proptech across its residential portfolio?

For property management, we use 360-degree (3D) imaging technology that captures every component of a home, eliminating the need to take pictures to document its condition. We can then catalogue the age and make of various major home components, including appliances, water heaters and air conditioning units. The collected data can be mined to estimate the cost of annual repairs and to better manage inventory in our maintenance trucks. And with more than 100 maintenance crews across our single-family rental operation in the US, we’ve invested in new network fleet technology to ensure timely and high-quality service to our residents. We can track the location of our fleet at all times, allowing us to optimize travel routes to ensure on-time arrival for maintenance calls or provide accurate updates if needed.

We’ve also been rolling out a ‘smart home’ system that provides keyless home entry for residents, smart thermostats to reduce energy consumption, and in-home sensors to monitor any water or moisture intrusion in key areas. In essence, we believe proptech is benefiting our residents and investors, which makes it a great area of focus for Tricon.