It’s Friday afternoon. Your car is in a sea of traffic, slowly slogging its way out of an overcrowded city. And just ahead, on the side of the busy road, you see a row of well-maintained apartments next to a billboard that trumpets, “If you lived here, you’d be home by now!”

A roadside billboard is just one of the many ways to reach potential residents. Property managers of multifamily real estate need to be very strategic about using collateral and marketing tactics that 1) maximize their advertising budget, and 2) build a brand for that particular property.

WPM Director of Multimedia Marketing and Communications Brent Gratton describes his process for achieving these two objectives for a brand new or takeover property.

“A lease-up property has no face. It’s up to us to communicate a property’s points of distinction. When we start, we look at who is the resident or demographic for this property. Will it largely be students? Is it intended to be high end? Then we put ourselves in the shoes of that target market.”

From there, Gratton’s team creates collateral—the collection of media used for marketing—that helps the property stand out to that specific potential resident.

“We understand that perspective residents have choices. There may be five different properties in the same area with similar amenities. So how can we help our property stand out? One strategy is helping the resident envision his or her life in our property. All of the images and language of our collateral depicts the lifestyle the resident will enjoy if they lived here. For example, we may create a sidebar of ‘Things to do’ on a brochure or webpage so that they can picture what their first Saturday as a resident would look like.”

Another essential element in Gratton’s narrative about a property is the promise of community.

“People don’t want just a residence, they want a community,” he explains. “We foster camaraderie among neighbors by hosting and encouraging social events, such as ‘yappy hours’ for pet owners, wine night mixers or even creative events like a murder mystery dinner. These events help residents feel more at home because they build friendships with each other. This, in turn, helps us because it means they are more likely to stay. Naturally, a property with a great sense of community is a selling point that we are certain to highlight when reaching out to potential residents.”

Obviously, this is too much information to fit on a billboard! So which media provide the best options for getting a property’s “story” in front of potential residents? Gratton asserts that the best way to reach perspective residents is online.

“Print advertising is no longer the way to go,” he explains. “The best way to maximize your marketing dollars is to place ads on Facebook, Twitter, Instagram and Google.”

Not only are these placements often less expensive than traditional print, they boast the added benefits of “re-targeting”—a cookie-based technology that anonymously follows the target buyer all over the web—and returning valuable analytics about the ad’s performance, such as the click-through rate. These ads then drive traffic to a property’s website, another key piece of the suite of marketing materials that tell a property’s story and paint the scene for potential residents.

So back to that roadside billboard… Chances are, if you, as a weary commuter, were interested in avoiding traffic and moving into those tempting apartments, at the next stoplight, you might pull up that property’s website on your phone. And if Gratton’s team did their job well, you would spend a few moments picturing what your life would be like if you lived there. And later that night, when you finally made it home and were relaxing and scrolling through Facebook, an ad for that property would “re-target” you and show up in your newsfeed. Next thing you know, you’ve clicked-through to the website to view gorgeous property images and imagine how much fun you’d have at a community wine night and how convenient it would be to be able to walk to so many nice restaurants… And before you know it, the combination of great storytelling and advertising placement may just have the desired effect of converting you from commuter and prospective resident to resident.

Mark M. Caplan

We recently sat down with Mark Caplan, WPM Real Estate Management’s Chairman – who is also an investor in multifamily real estate and is a large client of the firm – and asked him to put on his “customer” hat for a brief discussion about his perspective as a client about the multifamily real estate market for 2018. 

WPM: How would you describe the multifamily real estate investment market today?

Multifamily real estate continues to be perceived as a desired property type. With significant amounts of capital pursuing limited transactions, low capitalization rates (5-6%) have resulted in higher sales prices for all properties both old and new. This has caused more money to shift towards development, particularly for more expensive rental units. As the supply of higher-end multifamily continues to increase, potentially faster than demand, the operating environment has become challenging for lower price points as well.

WPM: How has this market changed over time?

A lot of forces are at work. First off, the real estate industry – like the rest of the world – is becoming increasingly data-driven. There’s much more information available today regarding property performance. That’s critical because investors perceive access to more data as leading to less risk. The more you know about something, generally the more you’re willing to pay for it, because you’ve eliminated some risk by possessing additional context.

Real estate is also increasingly considered and compared to other asset classes (stocks, commodities, etc.). The hierarchy of perceived risk has changed. This has resulted in more money flowing into real estate, further driving down returns.

WPM: Where do you think the multifamily real estate market it is headed in 2018?  

Overall, I think it will remain comparable to where it was in 2017, absent something unpredictable and catastrophic. Perhaps there will be some hesitation on new projects as investors wait to see if what has been created is absorbed. Remember, residential units to be realized in 2018 were conceived in 2015/2016. Real estate doesn’t turn quickly, and projects conceived in 2018 won’t deliver until 2020. With more supply coming into market in 2018, and fewer new deals done, 2020 may see less of a supply/demand imbalance.

WPM: What do you perceive the biggest opportunities to be in 2018?  

I think the areas that are most variable and challenging are office and retail – how people work and how they shop. If you feel confident in your perspective and are willing to invest, you have the potential to be really right or really wrong. I have a good sense of where people sleep and where they want to live, but work and shopping are changing quickly. Because real estate is less permanent, these types of investments are challenging, but they also represent opportunity.

WPM: What do you think will have the biggest impact on investors/owners in 2018?

At a macro level, the national and local economy are the two biggest external factors. I think the third is consumer preferences or residential preferences. We’re living through a time where people want to live in cities. But as millennials get older, and schooling and open space become more important, it could cause the suburbs to be more attractive. Transportation-oriented development has become more prevalent, the need for a car less so. Changing demographics of renters and the makeup of the student population at U.S. colleges and universities may also have an impact.

WPM: How do you think the Baltimore market stacks up against neighboring markets (DC/VA/PA)?

Politics and real estate are local. I don’t see individuals generally choosing between neighboring cities from just a rental perspective. That being said, look at Marc Train ridership between Baltimore and Washington. From a fundamental economic basis, Baltimore is compelling in that we have great transportation, higher education and a lower cost of living. But Baltimore has perceptual and real challenges right now because of crime. Baltimore could use a good year.