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AI’s Influence on Multifamily Is Spreading

If the words artificial intelligence only call to mind ChatGPT (or, for Boomer types, the autonomous assassin HAL 9000 from the 1968 Kubrick film 2001: A Space Odyssey), you’re missing out on its tremendous potential for your business.

Yes, the popular language model program can write real estate listings and flyers, but there are many other potential benefits of emerging AI technologies that far exceed these capabilities, though there are challenges ahead.

“AI is profoundly transforming the industry,” observed Jason Steiner, Seattle-based partner of design and planning firm Mithun.

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The National Multifamily Housing Council recapped top takeaways from last year’s OPTECH Expo by noting that AI was a common theme throughout the program but not a foregone conclusion: “The desire to leverage data and analytics to drive decision-making and optimize performance means multifamily executives are hyper-focused on leveraging machine learning and AI. However, it’s still evolving. Executives noted the need for (1) clean data and (2) just lots and lots of data—both of which can be difficult to achieve.”

Marketing support

In the meantime, AI has already proven to be useful in the marketing department. “We use AI tools to help with our online reputation, like drafting responses to online reviews.” said Matt Mehon, marketing director for Marquette Cos., a Chicago-based development, property management and investment firm. They are also starting to use it for pricing strategies and for turning cell phone photos into

“AI can allow you to imagine what spaces will look like and create instant renderings so that marketing to various preferences is much cheaper and faster,” commented Lisa Cini, whose Columbus, Ohio-based commercial firm, Mosaic Design Studio, creates apartment and condo communities for the 55-plus market.

Leasing aid

AI-powered leasing, with prospective residents communicating first with digital agents, scheduling tours and receiving relevant information online, is widely and successfully used, commented Lela Cirjakovic, managing director of multifamily property management JLL. This lets leasing staff focus more diligently on what she calls the “critical nurturing steps” for those prospective residents who have advanced past automated initial inquiry phases.

“There are numerous tools in use today that were met with a bit of resistance initially but are now welcome enhancements that improve the employee and resident experience,” commented Cirjakovic. “AI-powered chatbots and virtual assistants can answer resident and prospective resident questions accurately 24 hours per day.”

Mehon also sees AI as a leasing helpmate and timesaver: “Most customers expect immediate responses, and if they don’t feel that communication is good, they will move on to the next property. Our AI engages the customer instantly, through their preferred channel, answers questions about the community, and offers information about the property.”

AI-generated building design image

AI tools can help create building and design efficiencies in multifamily projects. Image by Mithun

Resident service

Smart thermostats, lighting, stoves, refrigerators and hot water tanks can be very helpful in managing utility costs, but also in handling complaints, Cini suggested.

For example, if a less tech-savvy resident calls the office to complain that her thermostat or heating system isn’t working, smart devices can determine what the situation actually is, the designer noted. Perhaps the caller just raised the temperature five minutes ago, but it takes 10 minutes to heat the apartment.

AI can also reduce the risk of expensive insurance issues. “Potential leaks will create an alert and can be dealt with prior to ruining four floors of apartments,” she adds, citing another use. These tools can also point to security issues and potential energy savings, Cini noted.

Marquette properties are using AI to help with routine work requests. “For example, if a resident needs to file a work order request, we have trained our AI to help the customer take the appropriate actions so the on-site team doesn’t need to get involved, (unless it’s an emergency), which results in a quicker resolution than if a person was involved,” Mehon explained. Emerging AI technology will go even further and file the work order for the resident, saving everyone time, he anticipates.

Marquette has a strong Generation Z client base, which provides the firm with an advantage. “Gen Z is the first generation to live in an entirely online world, which means they expect to be able to do everything and get all the information they need from entirely digital resources,” Mehon pointed out.

There’s probably no better market than these youngest tenants and condo buyers for AI integration. That can, in turn, add convenience and luxury to their resident experience without adding payroll expense to the property. “I imagine we’ll see AI-powered concierges/door staff soon,” he predicted.

Data wealth

There is also data—the “oil” of the 21st century—and its benefit to multifamily operators. “We now have unimaginable amounts of data available internally and externally,” declared Cirjakovic. “Real time data that is actionable, predictive and maximizes performance throughout the asset’s life cycle is a gamechanger.”

The firm has created JLL GPT to optimize this potential, “allowing staff to harvest proprietary databases to answer questions by its users,” she said.

“We would like to see AI help us evaluate specific business problems based on multiple inputs,” Mehon commented. “We would also like to see AI accurately analyze and synthesize data and render it in a way that’s easily understandable. This information would then be used by experts on our team to help make informed decisions.”

Design and planning

Mithun’s Steiner currently uses different categories of data for effectively planning projects. “We use AI to explore and discover site and building configurations for various development scenarios, optimizing layout, unit count, mix, efficiency and economic metrics,” he said. “AI tools allow designers to rapidly iterate options and make informed design decisions in real-time.”

Cini sees future AI potential in her design work. “Lighting should be smarter to help with sight issues and help to increase proper sleep,” she explained. “Windows with AI can block folks from seeing in, help to create a consistent environment, and auto-darken for sleep.”

Fully integrated security, safety and smart products with the ability to reduce costs, handle issues quickly and provide a safe environment fill out her AI usability wish list.

What could go wrong?

Not every industry pro is completely sold on AI’s potential. Cirjakovic cites cost as a concern: “Anyone who is looking at technology needs a proven value proposition or business case that demonstrates how the technology can improve performance, reduce operating costs or in some way positively impact value.”

Marquette is also not rushing in. “Our main concerns are around how feasible it is to implement a technology into our operations, including the associated costs, how quickly we can integrate it with our business and, most of all, how it affects the customer experience,” Mehon said.

Cini sees potential for her developer clients and their older prospective residents but is concerned about data security and user comfort. Many of her 55-and-older end users are already experienced with smart assistants—like Siri, Alexa and Google Home—but some are wary of privacy issues and less well-known (to them) services like ChatGPT.

“Everything is being watched and recorded in an effort to create a more tailored high-quality experience [so] that you will want to spend more time and money,” is how the designer hears their concerns,” Cini said.

The NMHC recap highlights another serious concern for the industry: “…there’s more scrutiny around unintentional bias coming out of the algorithms driving AI applications.” When AI tools fail in this way, quickly and transparently addressing legal and regulatory issues for the affected population is key.

“AI will complement human creativity and expertise, allowing for the exploration and development of a wider range of design possibilities,” predicted Mithun’s Steiner. Being able to create much-needed multifamily housing faster and more cost efficiently will have huge societal benefits in alleviating acute housing shortages in many parts of the country.

Cini’s oldest residents may not be quite as sanguine. “Ninety-two percent of Boomers state that safety is one of the largest considerations for a living environment,” the designer shared. AI and AI-enhanced robots—if these older users can get past decades-old HAL-inspired concerns—can provide more opportunities for older adults to age in place, she said.

Jamie Gold, CKD, CAPS, MCCWC is a Forbes.com contributor, wellness design consultant, industry speaker, and award-winning author of Wellness by Design (Simon & Schuster, 2020).

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