Internet quality is a key decision-making factor in multifamily today. The typical renter has seven or more internet-connected products and spends an average of 60 hours per week using them. Your renters depend on internet connectivity to stream entertainment, play video games, video conference with friends and family, and work remotely.
Quality internet is also essential for operations, as staff and proptech solutions rely on it more and more. Everything from resident communications to cloud-based CRMs to smart access control needs to be connected.
The quality of internet connection can have a huge impact on the day-to-day happiness of residents — and your bottom line. So we commissioned a third-party report to find out how community WiFi is addressing residents’ needs, and how multifamily owners are using it to boost profits.
We’ll dive into some of our findings here. But first, let’s define what community WiFi is and how it’s different from other multifamily internet options.
What is Community WiFi?
Community WiFi is the next evolution of modern managed WiFi. With community WiFi, every resident can have their own network and stay connected to it no matter where they are on the property — and achieve a particular speed. It’s a completely seamless experience that residents can set up themselves in minutes and not have to think about again.
In this model, owners finance the WiFi access points and place them strategically around the community so signals don’t overlap and compete. On the backend, each apartment — and staff office — has its own network and password, so there are minimal security concerns. A centralized brain manages each network and seamlessly hands off the connection to the closest access point as a person moves about the community.
Generally, owners can deliver this experience to residents at a lower cost than they might pay individually, which means community WiFi is both a revenue opportunity for owners and a savings opportunity for residents. That said, many owners find that they can charge more than retail for the connection since it’s more convenient and works better.
What are alternative WiFi options?
Community WiFi delivers a high-quality connection, a seamless experience for residents and proven benefits for community owners. But it’s not the only kind of multifamily internet on the market.
Here’s a breakdown of the other ways communities can get internet access:
Managed WiFi is a type of bulk internet that uses fewer access points to optimize internet in a multifamily community while minimizing competing networks. Instead of each resident dealing with the internet company directly and using their own access point, owners (or a company they hire) manage the WiFi for everyone. There may be only one or a handful of networks that everyone is on.
Residents experience fewer dead spots and slowing than retail and bulk WiFi, but security risks are greater because everyone is on the same networks. And guaranteeing residents a particular speed is nearly impossible. On the plus side: owners can deliver access immediately upon move-in by simply providing the network and password to new residents.
Your staff can be on a separate network than the residents, but they’ll lose connection as they move away from their office.
Bulk internet is one step above retail internet. The community owner signs a (usually exclusive) agreement with an internet provider to offer internet to all residents and staff. This lowers the price point for residents, but it might put more responsibility on the owner/operator, depending on the contract with the provider.
Residents tend to experience poor connectivity because each unit has its own access point and network, and those networks overlap and compete. There will be dead zones in some areas, and if owners want to provide internet access throughout the community, they will need to create additional networks on their own.
Staff internet needs can be handled at the same bulk-rate discount, which can lower overhead slightly. However, staff will encounter poor connection speeds or lose the signal if they venture beyond the leasing office.
Retail WiFi is what most apartment dwellers have. Residents choose from the available internet providers in their area, sign individual contracts for service and pay the provider directly. Retail WiFi is typically the most expensive internet option for residents. It’s the most expensive option for owners, too, because they have to sign their own contract with an internet provider to establish a network for their site team.
With this model, residents may rent equipment from the internet company or provide their own, and each unit will have its own completely separate network. As residents move away from their unit and into community areas, they will lose their WiFi signal.
Some owners choose to provide WiFi in community areas at their own expense, but these networks add to a large number of competing networks in each unit. And when multiple networks compete for connection among a sea of computers, tablets, phones and IoT devices, connection quality drops significantly — a common problem in multifamily communities.
Community WiFi attracts and retains residents
Internet connectivity is no longer a luxury — it’s a utility. And quality internet service is an amenity on par with fundamentals like laundry facilities. Community WiFi delivers a better experience than retail, bulk and even managed WiFi, so it’s no surprise that it can help you attract and retain residents.
Our research confirms it.
Community WiFi adds a regular revenue stream
According to our third-party report, most owners earn back their community WiFi investment in just two or three years. After that, continued profits more than fund equipment upkeep and replacement.
Even better? Owners can use this additional income to fund investments such as building technologies and smart amenities for residents — further solidifying their communities as tech-forward.
Renters are willing to pay extra for community WiFi
When it comes to community WiFi, the majority of renters are willing to put their money where their wants are, which means owners who invest in community WiFi have a revenue opportunity that competitors don’t.
Currently, renters pay an average of $58 per month for 300 Mbps internet, and the vast majority of these plans are retail or bulk internet. Given that these models deliver a subpar WiFi experience, it’s not surprising that our report found 64% of people would pay at least $49.99 for 300 Mbps community WiFi. It's a better deal for better connectivity.
Meanwhile, 35% of respondents said they would pay at least $99.99 for this service. Considering the cost of providing 300 Mbps to residents in many communities is considerably lower than retail rates, that’s a huge revenue opportunity.
So community WiFi can be highly lucrative. But is it worth the initial investment? Our research shows that it is.
"There’s lots of financial advantages [and] you’re able to make a profit off of it, too: bring in additional revenue, bring in NOI. Ultimately all that revenue adds value to the asset, makes the profitability go up. These are far more lucrative than a traditional marketing agreement with a carrier.”
- VP of Information Technology, Multifamily Owner/Operator
While the deal you negotiate with an internet provider will vary across communities, most owners recoup their initial investment in just two or three years. Even after accounting for equipment-replacement costs every five to seven years, owners still make a tidy profit. And the numbers work for both new builds and retrofits.
Many owners use this recurring income to fund additional technology upgrades like Smart Apartments, smart access control and smart parking management — each of which can also improve your profitability.
Nearly everyone wants community WiFi
Today, just 3% of residents have managed WiFi, and only 1% have true community WiFi that lets them roam seamlessly throughout the property while connected to their own network. Apartment dwellers who don’t have community WiFi want it — at a rate of 79%.
When we dive into what kinds of people want community WiFi, we found high interest levels across the board. People living in luxury communities are the most interested (88%), but even market rate communities (79%) and affordable housing residents (77%) want it.
There’s also wide appeal among residents who aren’t especially tech savvy. Around 87% of residents who identify as early technology adopters want community WiFi — and so do 59% of the slowest adopters.
In general, the people who want community WiFi most are households with kids, online gamers, remote workers and smart device owners.
Renters rave about community WiFi
Thanks to better performance and often lower pricing, people with managed and community WiFi tend to be happier with their living situation. Modern managed WiFi, including community WiFi, can boost Net Promoter Scores (NPS) by 26 points over retail internet.
That means these renters are much more likely to recommend your community to friends and family. Residents who are this happy with their living situation are also far less likely to be lured away by your competitors.
Community WiFi lays the foundation for competitive communities
Community WiFi benefits residents and your bottom line. But did you know it can also help you prepare for the future? Many proptech solutions rely on connectivity throughout a community to run devices, share data and enable communication. These solutions can bring efficiency to your operations and support additional premium amenities.
Building operational technology
When your entire community has quality, reliable WiFi, you can choose an access control system that runs on that WiFi. You ensure residents and staff can use their phones to enter your community instead of carrying keys or remembering a PIN code.
“Community WiFi offers faster speeds to residents and connectivity across sites. It’s the foundation for what
we want. Initiatives like EV charging stations in the parking lot – they need to be connected. We can put on a cell signal, but that might not be consistent. We want an operational network across the site, where we can connect EV chargers, access control, and camera systems that are remote from the leasing office.”
- Director of Building Technology, Multifamily Owner/Operator
Community WiFi also helps lay the foundation for streamlined maintenance management. Technicians can stay in communication with residents, see work orders on their phones and track assets from anywhere in your community.
Finally, community WiFi helps you implement or improve self-guided tours by ensuring prospects can fully explore your community and experience a seamless connection at the same time. And that makes it easier to fill vacancies quickly.
Offer a premium lifestyle
Tech-enabled apartments are more in-demand than ever, and the communities that offer these premium amenities will attract young, affluent prospects. Deliver a great resident experience, and these renters will want to stick around for years to come.
Community WiFi makes it easy to add Internet of Things (IoT) hardware to improve resident satisfaction. Smart locks, thermostats and sensors increase convenience with the ability to give guests temporary-access PIN codes, automate temperature changes and receive alerts when a leak is detected.
Community WiFi is the best internet option on the market for multifamily properties. It delivers a better resident experience, boosts staff efficiency and increases profitability. ROI varies from community to community, but this technology pays off by adding recurring revenue and laying the foundation for additional proptech opportunities.
Not sure how to take your multifamily community to the next level?
Planning and implementing your next smart proptech upgrade isn’t easy, but that’s why we’re here. Our experts can help you figure out how to make your community Next-Level Smart™ — and get the most value from your investment.