By Jack Stubbs
In the current age of commercial real estate tech, many platforms are looking to streamline the property management industry. Urbandoor, a company founded in 2015, seeks to simplify the apartment searching process for tenants.
We recently spoke to Erik Eccles, co-founder and CEO of Urbandoor, about what platform, how it aims to redefine the property management industry for residents and managers and what lies ahead in the increasingly tech-driven commercial real estate market.
What can you tell me about Urban Door (where and when the company was founded, current objectives, etc.)? In a nutshell, what does the platform allow industry professionals to do?
Urbandoor’s mission is to make it incredibly easy to find a place to live. Today there are tons of websites to find an unfurnished apartment for a year, but we realized people are looking for more than that today. Companies like WeWork have redefined what a place to work means in the commercial office market by giving you ready to move in office space at flexible terms. We are doing that in the apartment world. One key aspect of our approach is that we focus on the technology that enables the current apartment managers to expand their offerings versus trying to compete with them. To begin learning and testing our technology quickly, Greystar, one of the largest apartment operators in North America, came on as an early investor.
Through our technology platform and automation, we help multifamily apartment owners and operators offer and operate apartments that come fully furnished with wifi, cable, utilities, and optionally housekeeping, all included in one simple rate. This includes a full digital experience, from discovering the apartment, renting it online, performing a background or credit check if needed, providing rental insurance, and lastly establishing the payment method.
The Urban Door platform offers business accommodations rather than vacation rentals or second homes. What accounts for this more specific strategy?
Success in these apartment communities is really about creating an amazing environment for their residents. To date, most apartment communities have only been available through hard-to-find brokers or vacation platforms like Airbnb and Homeaway. By aligning ourselves with the goal of the community and focusing on prospective customers that look at it as home, we have been able to grow our available inventory faster than any other platform on the market.
We focus on multifamily apartments since [they] deliver [the] consistency people are looking for as well as [providing] a clear way for Urbandoor to scale. Since a major part of our platform are the tools necessary to run these apartments, we felt it was best to focus and deliver a world-class experience.
How have you seen the demands/expectations of potential clients changing over the last 2 to 3 years? What property features/amenities are clients tending to prioritize when searching for an apartment?
People want things online. It’s frustrating in today’s day and age to not have information immediately accessible. Early on, many customers that began testing us could not believe [that] it [could] be this easy. The most important features we’ve seen really depend on the type of customers. Someone staying as part of a relocation tends to thoroughly examine everything, as they may move to a longer-term lease on their own once their employer-paid rental ends. Our first ever booking on Urbandoor was for 90 nights and at the conclusion of the stay they walked into the property’s office and took a 12 month lease.
How do you see demographic/generational trends influencing client preferences?
This is very much in parallel to what WeWork is doing in commercial leasing. More and more prospective customers have an expectation that things can be ready immediately, [asking] ‘why would I need to furnish this? can’t you do that for me?’ An interesting move last year was Ikea buying Taskrabbit. It was a clear indicator [that] the emerging generation of renters are willing to pay for immediacy.
What are some of the broader regional and national regulatory requirements (e.g. safety, security, property transparency, etc.) that Urban Door implements into its business model? In broader terms, how are these regulatory issues playing a role in the multifamily markets regionally and nationally?
We work with our property managers and owners to constantly look at how our technology platform and automation can apply to their entire resident base over time. We see many of these lines blurring over time.
One of our company’s values is trust. As part of that, we make sure every property is operating within the rules of the local municipality. In most cases, this is [the] length of stay. On Urbandoor, each property can set their minimum to match the local law. In the case where there are stays under 30 days, we provide a full tax solution so that every stay collects and remits taxes to each locality. The other key area is working with the properties to maintain all the items necessary such as background and credit checks as required.
Currently, what are some of the trends driving demand in the multifamily rental market? What do you predict rental rates and demand for properties in the next 12 to 18 months?
Supply has been the major driver of slower absorption rates within some US markets. If you look ahead, the number of units coming online in the next two years it shows that this increase in supply will start to reduce and as a result return most markets to rates that they have been accustomed to. On the demand side, population data still shows strong growth in apartment demand, so it’s really about managing supply.
At the end of the day, how does Urban Door seek to make its mark, and what are some of the challenges involved in predicting/participating in the evolution off a continually-evolving multifamily market?
Marketplaces and platforms are incredibly tough to build. We think our strength lies in our early investors, apartment owners, and customers. Instead of taking a traditional venture approach out of the gate, we partnered with companies that are convinced and want this change in the industry and in turn want to take this idea through to success.
In the current day and age—where most products and services are going virtual—privacy and security issues are increasingly prominent concerns, both for prospective residents and for property managers. How does Urban Door strive to address this complex and unpredictable variable?
Privacy starts with technology, extends to processes and ultimately ends with transparency to the customer in the case of not meeting your expectations. Our approach starts by focusing on the task at hand and not looking at ways to sell data, share data, or any other approach unless its to fundamentally deliver the service we are providing. Many companies do well at the technology part, but they lose focus on what their business truly delivers and begin to figure out how to leverage data for other revenue.