Four smart strategies to navigate capital constraints at multifamily properties

Current difficulties accessing capital can prevent multifamily developers and owners from taking actions to effectively address high vacancy rates, minimize resident turnover, and perform necessary maintenance or amenity upgrades as they attempt to keep properties up to market standards in today’s competitive residential environment.

Compounding this, landlords of multifamily apartment complexes, offices, and other commercial real estate face $1.5 trillion of hard-to-refinance debt that comes due at the end of 2025, according to Bloomberg. Multifamily apartment building owners hold about 40 percent of that maturing debt, and many are effectively underwater today due to declining property values, said Bloomberg.

Alternatively, development projects that haven’t yet broken ground may already be causing concern about funding.

Dodge, bolster, adopt, and secure are four strategies that can illuminate ways to ease your liquidity challenges and elevate your property’s value. Future developments can also leverage these strategies to turn your project aspirations into reality. Surprisingly, a key commonality includes fiber internet solutions.

1. Strategy: Dodge capital investment expenses

It’s simple when you know your Internet Service Provider (ISP) will cover the investment costs. For both new and existing communities, ISPs can agree to incur fiber network and equipment investments and the expenses of installation and ongoing customer support. Here’s how the right ISP can help keep your money in the bank, do more with less funds, or allocate budget to something else.

A door fee is a cash payment that an ISP offers developers as an incentive for giving the ISP permission to install fiber within their new residential community of single-family homes or multifamily buildings. It is called a door fee because it’s a one-time, lump sum paid per unit (or “door”). Door fees can be extremely useful to developers with limited funds.

Older multifamily buildings must stay competitive even as new apartment buildings—which are likely to include fiber internet access from day one. By choosing an ISP that will make the investment and deploy fiber “overbuild” directly to each unit in your building, you can upgrade your property to the latest technology, future-proof your building for technological advances, and increase your competitiveness, all in one swoop.

Choosing an end-to-end ISP partner like Quantum Fiber, a Lumen Technologies brand, helps ensure you receive expertly engineered and tailored solutions that add value to your community and free you to look at other investment needs.

2. Strategy: Offer WiFi as a premier amenity and bolster cash flow

Imagine being able to tell prospective residents that their apartment would be pre-wired and pre-equipped with everything they need to get access to high-speed fiber broadband—and that they could be online before unpacking their first box in their new home. WiFi can give you an edge positioning your property against competition, by offering premier amenities.

How else can installing fiber bolster your cash flow? It can allow you to:

• Increase occupancy rates by attracting more residents.
• Minimize turnover as satisfied residents stay longer, reducing advertising costs to vet new ones.
• Justify higher rents due to the premium nature of fiber connectivity, driving higher revenues.
• Boost overall property values with fiber-to-the-unit or fiber-to-the-home.
• Create a revenue stream or savings with a bulk agreement.

A bulk contract sets the rate an ISP sells you a multi-year bundle of fiber internet services for residential use. Like anything purchased in bulk, there are advantages to the buyer (you), primarily, an exceedingly competitive price compared to current and future market rates.

You can then generate more revenue by increasing your monthly rental rates or amenity fees—which now include fiber internet access. Or, with no markup, give residents amenity internet at the discounted rate. The choice is yours. Either way, the investment is covered, and benefits of amenity internet are yours to gain.

3. Strategy: Adopt cost-saving smart amenities

By offering smart community and smart home features, multifamily property owners can easily justify charging more rent. And, smart technology can streamline the time and cost of building management by giving property managers the ability to remotely monitor and control vacant unit HVAC, lighting, and door locks. Both reducing the maintenance costs of running your property and increasing the speed at which such services are delivered is a win-win.

Fiber is foundational for making IoT-connected smart devices function in a multifamily environment. For example, Quantum Fiber offers a service called Connected Pass℠ which allows IoT traffic to pass through the Quantum Fiber network, whether or not an active subscriber is living in a particular unit.

4. Strategy: Secure an internet service representative to your team

Having your ISP assign you a dedicated support professional—one you know by name—can bring value-added services that can support your management objectives. With expertise, resources and frequent involvement, Quantum Fiber Connected Community representatives support communities by:

• Training staff on Quantum Fiber features, equipment, and how to utilize gratis WiFi services.
• Educating staff on the resident sign-up steps, move-in/move-out process, and how to access additional support 24/7.
• Reviewing the property’s marketing agreement terms for marketing and promotion opportunities.
• Co-planning events for residents to help them learn about their internet service.
• Enrolling staff in rewards programs (as permitted by the property, excludes bulk agreements).
• Periodically conducting equipment refreshes after move-outs.
• Continually delivering materials for residents, refreshed signage, updates on promotional offers.

In summary: Generate cash flow and don’t break the bank.

It might sound too good to be true, but you can simultaneously integrate a fiber internet infrastructure and improve your capital position. By installing fiber in your multifamily property, you get a valuable, in-demand amenity. But make sure to choose your ISP wisely. Before deciding to sign an internet agreement, here are some insightful articles with additional factors for you to consider.