RealPage, Inc. (NASDAQ: RP), a leading global provider of software and data analytics to the real estate industry, in conjunction with J Turner Research, an online reputation management firm exclusively serving the multifamily industry, announced the results of a nearly three-year, first-of-its-kind study that reveals the measurable impact of online reputation on multifamily rental property outperformance.
According to the report, on average, properties witnessed a 3-basis-points (BPS) premium to market returns for each point a community improved its Online Reputation Assessment (ORA™) score, a metric to measure and benchmark the online reputation of multifamily properties. The ORA™ statistical model by J Turner Research, designed for property management companies, aggregates and analyzes online ratings and reviews of over 120,000 properties in the U.S. across 20+ review sites and internet listing services (ILS), with more than 10 million reviews.
The study reviewed historical financial and operational metrics from RealPage combined with 34 months of ORA™ data of nearly 6,000 properties across class A, B and C assets in every decade since the 1900s, spanning affordable and conventional apartments of all sizes from fewer than 100 units to over 4,000 units in the U.S. market. Researchers identified a correlation between key variables such as raw ORA™ scores, change in ORA™ score and revenue.
“We’re excited to announce the results of the study that demonstrates and validates the relationship between changes in online reputation and revenue performance over the market,” said Rich Hughes, SVP Data Science at RealPage. “In an environment of limited rent increases and shifting prospect expectations, paired with the need to continue to drive yield and NOI, reputation is now a proven lever to impact asset performance.”
In addition to observing an average 3 BPS premium to market returns for every point a community improves its ORA™ score, researchers observed decreased property performance with an adverse change in online reputation. The level of impact that online reputation can have on value creation varies by market and property type, but the study confirms that the role of online reputation is consistently a factor through a positive correlation between ORA™ Scores and Property Performance compared to the market.
This study also specifically analyzed the relationship between ORA™ and resident renewals by drilling down into four regional markets: Dallas, Phoenix, Atlanta, and Seattle. All four markets show that high ORA™ scores tend to enjoy higher renewal rates, while low ORA™ scores can struggle with renewals.
“This validates the need for a reputation strategy to stay ahead,” said Jay Parsons, Deputy Chief Economist and Vice President of Asset Optimization at RealPage. “Properties with lower ORA™ scores should build a strategy around raising their scores to increase property performance and value, while properties with existing higher ORA™ scores should focus on maintaining their scores to protect property performance and value gains.”
This announcement follows the announcement made last Fall by RealPage regarding the integration of ORA™ Scores into RealPage’s Performance Analytics Benchmarking and AI Revenue Management solutions.
RealPage will host a live webcast on April 14, 2021 at 3:30 p.m. ET to present the study and offer strategies to help property owners improve online reputation scores and drive more yield. Register for the webcast to hear the story and access the report here: https://www.realpage.com/webcasts/connecting-reputation-with-revenue/.
RealPage provides a technology platform that enables real estate owners and managers to change how people experience and use rental space. Clients use the platform to gain transparency into asset performance, leverage data insights and monetize space to create incremental yields. Founded in 1998 and headquartered in Richardson, Texas, RealPage currently serves over 19 million units worldwide from offices in North America, Europe and Asia. For more information about RealPage, please visit https://www.RealPage.com.
About J Turner Research
J Turner Research is the leading full-circle online reputation management firm exclusively serving the multifamily industry since 2012. Using its unique, 360-degree process encompassing surveys and a reputation management platform, clients are able to enhance resident satisfaction, increase closing ratios and improve their online reputation. J Turner is the pioneer of the Online Reputation Assessment (ORA™) score, which serves as the industry standard for measuring a property’s online reputation. The company analyzes the online reputation of over 122,000 properties across the U.S. For more information, please visit https://www.jturnerresearch.com/.