Embracing the Future

The sink in 5D is still leaking. The minutes from October are missing. Nobody can figure out who signed for 2A’s package. And what’s the status on those bids for the roof job?

Rolando Graham, who served as a board member for seven years at Bay Street Landing, a 134-unit Staten Island co-op, had spent too many board meetings dealing with pesky, time-consuming issues like these. Miscommunication and missing information seemed to clog up all the time. “There was no order trail, there was never a way to track things,” he recalls. “We would go over the same things time and time again.”

As a retired vice president in the information technology division of Lehman Brothers, Graham knew that the internet could help bring some order to the confusion. A year ago, he started developing a website that the board and shareholders could use to help organize building information and operations. Now Graham’s personal project has become ARC Online, a full-fledged software solution aimed at streamlining residential management headaches. The product is another indication of how the property management industry is steadily embracing the internet as a tool for increasing efficiency in client buildings.

Property management firm Maxwell-Kates took over Graham’s building in 2000, and through conversations with Graham, executives Bob Freedman and Eugene DiGiddio learned about the software he had been working on. Impressed by the program’s ease of use and potential benefits, Freedman and DiGidio decided to form a partnership with Graham to develop the software as a commercial application. The group brought in Andrew Benjamin, a former property manager and internet entrepreneur, as a senior vice president for sales, and set about refining and further developing the program.

The software itself is called the ARC Online Building Communications System. Unlike a standalone program that you’d have to install on your computer (like Microsoft Word), ARC Online is accessed through the internet by using a standard web browser (like Internet Explorer). It can be accessed anywhere there’s an internet connection: home, office, or even on vacation.

What does it do? In simplest terms, ARC Online provides shareholders, board members, building staff, and property managers with an interactive way to exchange information about building operations and issues online. Every user is given a password and has to log in to the website, and every user has access to different tools and options, depending on what they’re allowed to do. Residents can submit work order requests and authorize expected guests. Staff can update ongoing maintenance projects. The board can review everything and use that information to make decisions for the building about staffing and resources.

The ARC Online site is fairly easy to use. After logging in, a user is presented with a home page that highlights any news or additions to the website. There’s a long list on the left-hand side that lists and links to the different tools and options available: creating a work order, authorizing a visitor, e-mailing the board or agent, and reviewing the activities of committees. Building documents (proprietary lease, house rules, sublet policy, etc.) are stored on the site. There’s also a discussion forum where residents can post public messages. Notes about new local restaurants and other items of interest can also be posted. Board members and managing agents – depending on who is assigned to “administer” the site – see a different list.

Everything that is processed through ARC Online creates a trail; that means no more searching for lost work orders or trying to figure out how many hours were spent repairing something. And it gives shareholders some answers about what exactly is getting done in the building. “The bottom line is that it makes everyone more accountable,” Benjamin says.

“What we’re able to do is, at the end of the month, process this information,” Graham says, stressing that ARC Online functions in the same way as the decision-making software used by major businesses. “It gives the boards and managing agent information that they can analyze and act upon in a proactive fashion.” The board can, for example, see if a particular line of apartments is having persistent problems that may require a more thorough repair. As the system is used over time, board members will be able to look backwards and do research. That will help maintain continuity when new members join the board, Graham says.

ARC Online is the latest entrant in the developing market of commercial internet services aimed solely at managing agents and boards. Cooper Square Realty, AKAM Associates, and Wentworth Management all have their own interactive internet systems that serve similar functions as ARC Online. Buildinglink.com is an independent firm that offers its own internet-based building management tool. And several co-ops and condos have developed their own building websites in-house. All this indicates that residential real estate management is starting to play catch-up in terms of integrating the internet and technology into day-to-day building operations. “I believe we’re at the beginning of this whole evolution of real estate management,” Benjamin says.

Although Freedman and DiGidio are principals in Maxwell-Kates, the ARC Online software will be available to any building or property management firm; it is not a Maxwell-Kates exclusive. However, currently only Maxwell-Kates-managed buildings have access to the program. Pricing and fee structure have not yet been determined for the product, although there will be setup and monthly service fees, DiGidio says.

But for many residents, old habits die hard, and some may be hesitant to embrace new technologies. The idea of logging in and submitting a work order to get a pipe fixed may seem cumbersome to those accustomed to simply picking up the phone and calling the super. The ARC Online principals all acknowledge that education is a key component to any installation of the system, and it’s likely to take a while before a majority of building residents are using the system. “Everyone has been very enthusiastic about the system and the capabilities,” Graham says, “But where the rubber meets the road, it’s been a little slow.”

A 120-unit midtown co-op, managed by Maxwell-Kates, has been using ARC Online for the last six months. Property manager Matthew Newman, a senior vice president with the firm, says shareholders there have taken to downloading building documents from the online library, speeding up the steps involved in refinancing a mortgage and/or completing an alteration agreement. “[ARC Online] has shortened the process tremendously,” he says, freeing up the super’s and manager’s time. The other features of the system have been slow to catch on, but “we’re seeing more and more of it every day,” Newman notes.

Each resident is mailed a letter with his or her PIN number and instructions on how to use the system. The system also has a helpful, step-by-step instruction manual. ARC Online is also considering holding general information sessions with residents in order to walk them through the system. Freedman is quick to point out that no resident’s level of service is going to decline if he or she chooses not to use the system.

“Whether the service request comes in from someone writing it on paper or from the computer, we input it,” he says. “If someone needs a certain document, but they feel more comfortable calling, either way it’s the management company’s job to get them the information.”

The success of a system like ARC Online does depend on how many people are using it. Ideally, the cost of setting up the software and operating it is offset by increased efficiency and productivity by the board, managing agent, and building staff. Once the system is installed and customized, it is the board’s responsibility to make sure the site stays updated with new material and regular reports. If the board is an active advocate of ARC, that will help spur the rest of the residents to give it a try.

While ARC Online says any building can use its system, it is certainly a better fit with some properties than others. The larger the community, the more complicated the management and administration is likely to be, therefore making it a good candidate for a system like ARC Online. Its strong suits are in work-order tracking, guest authorization, and package deliveries, which again lends itself to larger communities with lots of maintenance work and visitors. If your board is fairly computer literate and communicates regularly through e-mail, then adopting the system is not likely to be cumbersome or confusing.

Will ARC Online really improve building operations? It certainly makes answers easier to find and gives the board and management a place to point shareholders; that, in turn, saves time spent answering phone calls and digging up, faxing, and copying documents. Down the line, the archiving feature can also be invaluable for new board members who want to catch up on what’s been going on.

As generations continue to change, and become more and more sophisticated, computer-savvy board members take office, products like ARC Online will eventually be the industry standard for any and all management companies. The question is, how soon does your building want to embrace the future?