Blog Post

Multifamily Owners Cashing in with 5G and Fiber

Written byextwpusr

11/30/2022

Whether your apartment community has a 19-year-old tenant who plays online video games all day or a doctor who practices telemedicine from her apartment, consistent and fast digital connectivity is a must.

From young people just starting out to retirees looking to downsize, multifamily homes have been an increasingly popular option in the United States. According to the Department of Housing and Urban Development, approximately 43 million U.S. residences, or more than a quarter of housing, are in multifamily dwellings. 

According to research by RVA LLC for the Fiber Broadband Association, fast, reliable broadband is now rated the single most important amenity for residents moving into multifamily buildings in the US. Broadband is more important to residents than a pool, 24-hour security monitoring, covered parking, gym access or even cable TV. 

Smart speakers, thermostats, door cameras and intelligent appliances will all require an indoor wireless network with robust, ubiquitous connectivity. That means a building or community-wide WiFi network that can scale along with growing wireless demands. Owners can supplement fiber-based networks with private communication technologies like 5G wireless to ensure they have coverage in their buildings.

As smart devices continue to proliferate, high download speeds and reliability are going to be expected, and tenants may gravitate toward the most prepared communities with the most advanced technology. 

Fiber Is a Differentiator

Broadband Communities Magazine defines Fiber as a long-term broadband medium that is essentially future-proof, supporting bandwidth requirements for today and tomorrow. The service tiers can be easily altered by software changes or, in the case of moving to a new technology generation, by upgrading the equipment on either end of the network. 

Fiber has at least 100,000 times the capacity of any other medium and is limited only by the electronics that are connected to it. With bandwidth demands increasing 10 times every 10 years, fiber is the only technology that can keep pace with the life of a building.

As a result of the significant growth in multifamily demand, asset managers are looking for ways to differentiate their residences. One emerging trend is to create “fiberhoods” in multifamily developments, providing high-speed, fiber-fed broadband to every unit. 

Revenue Improving Strategies

Over the next decade, we will be seeing a mass migration in the Multifamily industry to privately owned “Revenue Generating Internet” networks. According to Multifamily Insiders, if you are already in the business of selling Internet to your residents, your Private Network is safe, as long as you keep your competition out. 

Wireless carriers need to get their last mile, 5G equipment extremely close to your residents in order to fulfill their high speed, high latency promises indoors. They will need your permission and access to your property to do so. At some point, most property owners (HOA’s, etc.) will get a call or a knock on their door from a large wireless carrier (i.e Verizon, At&t, Sprint, etc.) asking for permission to install 5G equipment on the property. If you say yes, you will be giving a 3rd party access (i.e easement and or a right-of-way) to sell services to your residents. For those of you who own or plan on owning a private revenue-generating internet system, simply turn away the 5G installation request and if necessary, upgrade your network with 5G equipment.

Potential Property Value Increase Is 8 Times Your Investment

Multifamily Insiders indicates the revenue is too lucrative to ignore and the increase in property value is significant. Consider that 95% of all apartments do not own a Private Internet System, this means most sellers are listing properties without this revenue and the property resale value that comes along with it. Creatively increasing NOI from technology improvements not only sets your brand apart, but capitalizes on easy NOI others are missing. Many landlords are already taking advantage of this sweet spot. 

What Next?

According to RVA, consumer research shows that fiber broadband increases consumer satisfaction with the community itself, decreases churn and increases the perceived financial value of each unit. The property owner, with effectively marketed fiber broadband, can enjoy higher occupancy and higher rental rates, increasing financial return and ultimately the value of any fiber project. 

Here’s what it means for property owners and managers; 5G is the technology that will move analog apartment living to digital, transforming the way residents live and the way multifamily communities operate. With 5G, digital transformation will be amplified via innovations such as connected locks, centralized package delivery lockers, connected thermostats, intelligent appliances and smart data management.

To navigate the ever-evolving 5G landscape, owners should plan for property wide wireless coverage that accommodates rapid growth in digitization and rising resident expectations. If they don’t already, residents soon will get 5G speeds and coverage at work and on the go. They’ll want that same experience at home, raising the bar for fast, dense, low-latency property networks that extend beyond units into common areas such as the pool, gym and lounge.

And that’s just the beginning, as many 5G innovations have yet to be realized. For example, 4G was built before the app economy really took off with companies such as Uber, Lyft and Netflix. 4G technology enabled a new digital age. Now imagine what we can do with 5G. The possibilities are endless.

Extenteam is the #1 trusted staffing outsourcer for property management professionals operating short-term rentals, vacation homes, multifamily communities, and boutique hotel properties. Our dedicated remote team members work exclusively for you to supercharge your tenant services, leasing, digital marketing, accounting, and other critical support functions.

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