Multifamily Accounting to Manage Projected Growth

A fundamental of economics is that when supply and demand meet in that coveted sweet spot, the piece of the pie usually gets larger. Never more true, is in the current multifamily housing cycle. The last five years haven’t disappointed, as transaction volume has reached record proportions, exceeding $100 billion annually. According to the National Multifamily Housing Council, 33 of the Top 50 owners in 2017 boosted the size of their portfolios. And while transaction volume has dipped slightly since a record run in 2016, future investment in multifamily housing is poised for gusto. NMHC maintains that more than 325,000 apartments will need to be added each year up to 2030 just to meet a new generation of residential customers. Current growth of portfolios are already impacting corporate accounting in multifamily, and the future will certainly have an even greater effect. As portfolios expand, managing intercompany accounting for the corporate and operations sides of multifamily will require more firepower. Without a robust accounting platform, routine functions like billing and invoicing for a stable of properties will necessitate more manpower and adversely affect general and administrative operating expenses under old-school bookkeeping practices. Some are fighting through such scenarios just keeping up the current pace. “We’ve heard from our key customers about the inefficiencies of intercompany cost charges and allocations,” says RealPage Vice President Dan Newbern. “They spend significant time paying bills back to themselves.” Learn more now: RealPage Accounting Solutions Eliminating the headache of intercompany charges and allocations Property management companies have the arduous task of generating bills and invoices for each apartment community in the portfolio day in and day out. A PMC may choose to pay an invoice from a vendor, like the overnight delivery service, in full and then charge back each property appro...