Deal Snapshot: Valet Living

Harris Williams recently advised Valet Living on its sale to GI Partners. Valet Living pioneered doorstep waste collection and now offers a full suite of premium home-related amenity services to the multifamily housing industry. Here, we discuss what makes the segment appealing, the factors differentiating Valet Living from other companies, and our advice for buyers active in the multifamily housing services segment.

Why is this an appealing space?

Lucas: The total addressable multifamily housing services market is very large, and the industry is highly fragmented, which creates tremendous opportunity to build platforms. Also, the contract-based structure of multifamily housing services provides highly predictable, recurring revenue, driven by strong customer and unit retention.

Baltimore: Property owners and managers are increasingly turning to outside partners to manage resident engagement at the community level. And residents, particularly millennials and those in luxury Class A and B communities, want more and more services within their buildings. Companies that can provide a range of services can be attractive partners and capture this growing demand. Services could range from doorstep trash collection to concierge, mailroom, or laundry services to turnover services, dog walking, exercise class instruction, or a variety of resident engagement services.

What made this an especially attractive company?

Morris: Valet Living is the only nationally recognized full-service amenities provider in the multifamily housing industry. As an early entrant into the segment, Valet Living continuously evolves its processes and is a valuable resource for property management partners. Its services have been shown to boost residents' satisfaction with their homes.

It has grown both organically and through the acquisition of 15 companies that complemented its service offerings, broadened its geographic reach, and expanded its capabilities. The company is significantly larger than the next competitor and enjoys many benefits of scale. Yet there is still tremendous growth opportunity because of the size of the total addressable market.

Lucas: The company has made substantial investments in both talent and infrastructure to support that scale and growth. Its management team has relevant experience from leading Fortune 500 firms. It has also replaced legacy technology with industry-leading platforms and has developed proprietary mobile technology. Through its mobile app, Valet Living offers clients a fully integrated, one-stop interface to comprehensively manage amenities from home cleaning to pet walking, package delivery, exercise classes, and more.

Morgan: Valet Living also fared remarkably well throughout the pandemic. It became regarded as an essential service early in the economic shutdown. As families stayed home, they generated more trash than usual, and building owners and managers quickly realized the importance of Valet Living's doorstep trash pickup. Prior to the pandemic, Valet Living also had strong market momentum, with the early-stage rollout of home services such as concierge services, dog walking, and exercise classes. It quickly shifted to virtually engaging with residents through online exercise and cooking classes, among others.

What should other prospective buyers know about this subsector?

Lucas: The more a company can become integral to the community and the resident, the better. Turnover services support the building owners and managers through the quick turn of residences. Services such as pet walking are value-added for residents, as are dry cleaning pickups, exercise classes, and other services. The goal of companies in this space is to be doing so much for residents that they are the go-to for any type of service the resident is considering.

Baltimore: It's also important to note that Valet Living plays in just one segment of the multifamily housing industry. There are other areas where providers can establish themselves, such as in monthly rent payment processing, and create a stronghold, as Valet Living is working to do in its space.

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Published February 2021

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