The multifamily housing market is proving to provide both manufacturers and distributors a strong business avenue, even during the pandemic stricken era of 2020.
“The multifamily housing market has been growing throughout the U.S. at an unprecedented rate. It is expected to see multifamily continue as single family housing prices increase, making it more difficult for the average American to purchase their own house,” says Jacob Reese, sales and operations, Standard Plumbing Supply out of Sandy, Utah.
“To keep up with rent rates of new properties, older multifamily properties are renovating constantly. The large suppliers are catering to renovations teams, and seeing ample revenue growth and acquisition opportunities because of it” Reese adds.
Columbus-Ohio based Plumbers and Factory Supplies says there’s opportunity in both downtown areas and the suburbs.
“There are great opportunities in multifamily in both downtown and more suburban markets. Consistent population growth is driving that demand. We expect to see more price point driven projects due to a shortage in entry-level housing inventory,” explains Chris Reynolds, director of marketing.
Over in Pennsylvania, Duff Company, a PHCP supplier with a specialty in MRO and multifamily products, is seeing rentals become a more permanent lifestyle.
“There has been a clear shift to renting as a permanent lifestyle in more groups than just millennials. As a result, in order to attract and keep residents, properties are renovating older, dated apartments more than ever. We continue to see strong growth throughout the Mid-Atlantic region,” says Michael Genkin, general manager, multifamily housing.
Top product and customer needs
Across the board, smart technology and ease-of-install are leading in multifamily housing product trends.
“Water damage can be devastating, so it’s important for property owners to be able to protect themselves and the residents that occupy their buildings. Smart technology can help provide peace of mind and allow teams to manage issues with efficiency,” says Christina Pace, strategic account manager, single family rental, Moen.
Water heater manufacturer, Rheem, says multifamily housing products need to be able to fit into many different — often small — spaces.
“Multifamily builders are interested in products that fit into a variety of limited spaces. Applications could include skinny closets, lowboys under an air handler or patio closets. Plumbers are looking for products that are easy to install, especially if presented with a tight space,” says James Courtney, senior product manager.
“End-users are looking for products with enough capacity to fit family needs while also working efficiently to drive down energy bills,” he adds.
Reynolds notes there are three main customer needs distributors in the multifamily housing market are seeing right now: quick product availability, fast delivery and great customer service.
“Apartment managers make money when units are rented and renters are happy. If a unit goes down, maintenance workers cannot wait two weeks for a new faucet or water heater repair part to arrive. We have to stock the common cartridges, repair parts and let our customers know what is available. Distributors who are succeeding in this sector provide a ‘one-stop-shop’ for their customers.”
“Maintenance managers have plenty to do. Running to a store is no longer the norm. The expectation of MRO customers is same-day or next-day delivery service. Price and availability are necessary, but good service and a strong relationship will win the job over your competition; one aspect of this business that can never be overlooked is service to the customer,” he adds.
Genkin agrees, saying speed, product availability and quality service are what it all comes down to in the MRO and multifamily market.
“The reality is most multifamily communities just don’t have the space to stock everything they’re going to need or predict everything that’s going to break. Plus, with so many renovations being done, it’s easier and less expensive to have orders delivered right to the apartment, instead of stocking and lugging everything from the shop,”
“The longer it takes to renovate an apartment, the more rent that’s lost. Our customers realize far more money is lost in rent not coming in due to renovation delays than is ever saved by shopping and squeezing suppliers for a better price. With an average rent of $1600, finishing renovations just one week faster can save $800,” he adds.
Genkin also notes that quality service doesn’t just mean accurate orders. “It’s doing all the little things in-between like being available and responsive 24/7, making same-day deliveries, negotiating with manufacturers on behalf of customers and stocking new items.”
Making it easy
Whether talking about the maintenance contractor, building owner or end user, the bottom line within the multifamily housing market is making products simpler to get, install and use.
“Property owners are looking for technology that makes the lives of their tenants easier and make rental units a more comfortable and desirable place to be. The peace of mind and security that comes with something like a smart leak detection system can help both property owners and tenants feel more secure with their assets,” Pace says.
In order to make the lives of its customer easier, Gerberit, in-wall system and bathroom manufacturer, is focused on product availability and conversion kits.
“To eliminate supply chain delays, Gerberit is increasing stock levels. We have also developed easy retrofit kits to convert our in-wall toilet systems from manual to touch-free flushing,” says Ronn Jefferson, product manager.
In terms of new technologies developing in the multifamily market, Reynolds notes smart technology is making things easier for distributors and building owners.
“I think we can expect to see more smart home products creep into the space. Asset protection, along with preventative and predictive maintenance are huge for management companies,” he says.
In terms of technology, Genkin explains it’s important for distributors to pay attention to software used by multifamily housing professionals.
“It is becoming more important than ever for suppliers to integrate their operations with a number of third party purchasing software platforms apartment communities use. While the idea of shopping across multiple suppliers for the lowest price is appealing, customers more importantly want to know if you actually have the item and can deliver it the next day,” he says.
“In the end it’s a partnership. Those vendors that can execute well will save their multifamily customers money, make peoples’ jobs easier and build better relationships.”