The Service Side of Residential Space-As-A-Service

Space-as-a-service is a concept we discuss often. It’s fitting, as the new model for real estate leasing, where landlords provide a host of perks alongside just renting out space, has been spreading far and wide variously through co-working facilities, luxury apartments, and flex space providers.

In many cases, space-as-a-service is the result of tech developments that make it possible to offer more to tenants than ever before: tenant experience platforms, IoT-driven networks that open up new vistas of personalization, and similar disruptive technologies all have played their part influencing the future of the model. But space-as-a-service has another side to it as well, one driven by good old customer service and hospitality skills.

It’s a side plied by startups who have the ability to take tasks very familiar to us (walking the dog; taking out the trash; grocery shopping) and erase the stress and time commitment that each one represents. And for their efforts, these companies are being rewarded with business success. Hello Alfred, for instance, just announced its acquisition of tenant experience platform Bixby; Valet Living, another residential building service platform, just broke the news of its expansion to Arizona. But while these companies may seem to be part and parcel with high-tech luxury development around the country, similar to other PropTech platforms, they shouldn’t be confused with truly tech-based providers like sensor systems or tenant experience apps. While building service providers may utilize apps or the internet to communicate their offerings, technology isn’t as central to these platforms as companies based around AI or IoT, for instance.

First, service platforms are more “plug and play” than physical amenities like wellness spaces or even tech platforms like IoT devices. A prime reason for this is that service platforms don’t require any actual building modification to be effective. Shawn Handrahan, CEO of Valet Living, recently told us that “Thanks to the Valet Living Home’s flexible technology platform, it can be deployed in any style apartment community. Owners and developers from all types of communities engage with Valet Living’s amenity services in order to differentiate from their competition.” For secondary or tertiary markets, or far-flung suburbs of big cities, it can be much easier to simply sign an agreement with an amenity provider like Valet Living than to try to build in new physical amenities or tech features.

The big differentiator between service platforms and tech platforms comes down to manpower. Where tech providers have their own, often unique challenges to solve, service providers face a very old-school challenge: providing good service through the right staff. Whether the provider helps building residents walk their dogs or dry clean their clothing, a fallible human has to execute the tasks.

Valet Living solves the issue by providing its own in-house employees and management infrastructure. “Quality and reliability are two major factors in the decision-making process for Valet Living’s clients, specifically in multifamily,” Shawn added. “It is, for this reason, that for Valet Living Home’s pet visits, home cleans, in-home package delivery and laundry pick-up and drop-off we do not engage in partnerships. Instead, Valet Living sources, hires and manages its own trusted W2 associates. Our associates are led by a local District Manager in each market to manage quality and span of control.”

But at the end of the day, perhaps the biggest difference between typical PropTech platforms and these service platforms is the competition they face from other companies completely beyond the PropTech landscape. A building service provider can offer pet sitting or grocery runs, to be sure, but offering such options pits them against the likes of more single-issue tools like Rover or grocery delivery apps. Shawn mentioned that providing multiple types of amenities through one app increases resident willingness to use the app from 70 percent to over 95 percent. “Residents are experiencing app fatigue, as they do not want to download multiple apps for various amenities when one app can provide them all,” Shawn said. “Also, most of the single-purpose platforms are following the gig-economy model through which they are not vetting experts in the field. Instead, they allow multiple independent contractors to set up free profiles that are then empowered to manage their business as they see fit.”

Building service platforms have a range of challenges and opportunities that the typical tech-heavy platforms lack. For building owners, their best use may be as one part of an amenities ecosystem that also includes tech and physical offerings, for a true bundle of services worthy of the space-as-a-service moniker.

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