Deal Snapshot: ResMan

ResMan provides a leading property management SaaS platform that serves multifamily, affordable housing, and commercial markets in the U.S. Its end-to-end offering integrates mission-critical front- and back-office functions, including marketing, leasing, resident engagement, property operations, payments, accounting, budgeting, and compliance solutions. Harris Williams recently advised ResMan on its sale to Inhabit I.Q.

Here, professionals from the Harris Williams Technology Group share insights on what made ResMan an exceptional investment opportunity, as well as their advice for buyers and investors interested in property management and integrated payment technologies.

What makes the property management technology sector an appealing space for buyers?

Szyndlar: This is a multibillion-dollar market opportunity benefitting from strong tailwinds. An acute housing shortage in the U.S., combined with rising home prices, is driving significant demand for multifamily rentals. The shortage is also motivating the construction of hundreds of thousands of new multifamily units each year, as well as construction of mixed-use properties that deliver more convenience and flexibility. This growth is driving demand for technology to assist with all aspects of property management, with a preference for integrated one-stop-shop solutions. Demand is expected to remain strong into the future as high housing prices delay home purchases and aging baby boomers sell homes in search of lower-maintenance alternatives.

Titterington: Mixed-use properties like multifamily, affordable, and commercial housing have unique and complex needs. In particular, affordable housing requires purpose-built solutions that address strict regulatory requirements. It can be difficult to track and report compliance across local, state, and federal regulations, creating demand for technology solutions that ease this burden. On the commercial side, many properties are now mixed-use spaces. Owners and managers need flexible, integrated SaaS solutions that can handle a combination of residential, office, retail, and other types of tenants efficiently.

Monjauze: While there are industry incumbents focused on serving the large property companies, mid-sized property companies have been underserved, creating a highly attractive target customer segment. These customers require intuitive, easy-to-use solutions that are scalable and flexible. In addition, the property management technology landscape is fragmented, with substantial consolidation potential. The combination of these factors adds up to an appealing investor opportunity.

What made ResMan particularly appealing to its investors?

Titterington: ResMan is a single-instance, multitenant SaaS platform that is open and scalable. With more than one hundred different APIs, ResMan easily integrates with other solution providers and can be tailored to customer needs. Property management companies increasingly want a single-source solution to address their critical functions, and they want the ability to pair best-of-breed third-party capabilities with their core property management software. ResMan offers that.

Szyndlar: From a tenant perspective, the experience a property provides can be differentiating. ResMan helps clients provide a valuable experience, from client branding and single sign-on to an end-to-end leasing experience. Prospects can see interactive floor plans and complete an application and a background check. Tenants can manage their move-in and move-out scheduling and, importantly, pay rent through the platform. This also benefits the property owner, as electronic payment increases rent collectability and speed.

In the back office, ResMan helps property management companies manage all critical accounting, budgeting, reporting, and compliance functions from one place. It’s a robust solution that simplifies complex functions for owners and managers while providing convenience for residents.

Titterington: One of the benefits of providing an end-to-end solution is strong customer retention and embedded growth opportunity. Once the system is in place, the customer relationship is very sticky and scales over time as property managers acquire new units and add additional functionality to the system. This leads to significant visibility into future performance and highly scalable customer unit economics. ResMan empowers its customers to grow and operate more efficiently, and in turn grows its own business as a result. It’s a powerful model with a compelling value proposition.

What advice do you have for prospective buyers interested in this space?

Szyndlar: The best technology companies can demonstrate the ROI that clients are achieving with their platform, whether that’s cost savings, revenue growth, or both. In the property management space, questions to ask may be, “How does the technology enable clients to directly engage with their customers? Does the solution drive an engaging experience with tenants in a way that increases tenant satisfaction, supports rent collections, or decreases vacancy rates?”

Titterington: Another consideration is how well the technology can be leveraged into additional end markets either through organic product development initiatives or M&A. For example, an end-to-end solution such as ResMan could be a good fit for management of student housing, storage facilities, and other near adjacencies. These adjacent markets offer upside potential such as a larger addressable market and faster growth.

In addition to property management technology, the Harris Williams Technology Group has deep expertise across a wide range of enterprise application software, integrated payments, and tech-enabled services sub-verticals.

For a deeper discussion, please contact our senior professionals.

Brian Titterington | Director
Thierry Monjauze | Managing Director
Erik Szyndlar | Managing Director

 

Published October 2021

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