Digital wallet and embedded payments will help PropTechs turn renting an apartment into a community based, digital experience.
Bond CEO Roy Ng told Karen Webster that the wallets can conceivably be used by renters and developers at properties across a range of use cases and digitally-enabled experiences — eventually forging connected ecosystems that extend far beyond the confines of the monthly rent payment.
Those digital interactions will include everything from apartment applications to connecting with, and transacting with, local businesses, he told Webster.
Ng’s own firm is aiming to help forge that connectivity.
Earlier this month, residential real estate company Flow, WeWork founder Adam Neumann’s latest venture, said it is partnering with Bond to launch a digital wallet tool in what Flow has said will aid “an experience that will fundamentally change what renters expect from their homes.”
Although details of Flow’s business model have yet to be disclosed, the real estate company, which is also backed by venture capital firm Andreessen Horowitz, seems on track to borrow at least some aspects of WeWork’s operations, with standardized access to technology, amenities and the goal of fostering a sense of community for renters. Neumann has purchased more than 3,000 apartment units in Miami, Fort Lauderdale, Atlanta and Nashville, according to media reports.
Those capabilities will be announced later, said Ng, “but the whole idea is to ensure that Flow’s community members — the people who rent within their portfolio — have a seamless experience, for everything from getting into their unit, to completing the rental application to using the [complex’s] facilities to paying and transacting within and outside of the community.”
The Network Approach
Digital wallets are already gaining traction, as PYMNTS has estimated that 59% of consumers have used them in the past year, and the network approach is already finding a berth in the rental market, said Ng.
Companies like Zeus Living manage properties that can be rented for 30 days or longer across more than 100 destinations in the United States, effectively allowing consumers to move from one apartment to another, city by city, seamlessly. They do so with a single payment method, and there are incentives in place to use Zeus’ partners, he said.
Ng noted that embedded finance will play a critical role. Credit likely will be important (Flow joins the list of Bond’s partners that have chosen the FinTech to build credit-based solutions). For renters, generally speaking, said Ng, the ability to build credit is an attractive concept. Ng noted that the due diligence and know your customer (KYC) processes that must be satisfied to complete an approve a renters’ (or mortgage buyer’s) online application yield all sorts of financial and personal information that can create the cornerstone of a more widely connected experience.
Beyond rental payments, the opportunity for a wholesale digital transformation of real estate is massive.
“PropTech itself is an enormous space,” he told Webster, as the processes surrounding everything from buying properties to renting them to managing them is done by a fragmented roster of providers and myriad, paper-based processes.
For the landlords and rental offices, collecting rent payments has always been challenging. Rent changes according to the economy at large; tenants may want to split the rent with their roommates. And the property managers need to keep the lights on, pay staff and conduct due diligence on would-be tenants.
Thus far, he said, there have been “pockets of software that have been built for specific use cases.”
But if Apple, with Apple Pay and the Apple Card and its bundled offerings, can be viewed as a lifestyle, a community might be viewed symbolic of a lifestyle, too, especially with the growth of remote work situations. That lifestyle mindset extends well beyond 55-plus communities and can include younger demographics and the amenities that are nearby (restaurants, supermarkets, sporting venues and the like).
The interplay between rental communities, merchants and providers in the surrounding vicinity, said Ng, “is a really good way for companies to build networks around their specific target audiences,” adding that “how much you pay in rent is a good indicator of where you’ll tend to shop and what you’ll tend to do — those data points are valuable.”
Ng said unified ecosystems can take shape, tying all of those activities together through apps and payments capabilities with the digital wallet enabling transactions across all settings. Networks can evolve to include grocers, gyms and health programs, complete with embedded payments and loyalty programs tied to the apartment’s “brand.”
“Taking multi-family properties to the next level will be a really exciting endeavor,” he told Webster.