According to the newly released Information Technology Investment Benchmarking Survey, the average apartment operator spends nearly 1% of its gross revenues on technology deployments. Dave Cardwell, NMHC's vice president of technology and capital markets, says the trade association conducted the survey to help firms make better decisions about technology spending and staffing.

The apartment sector is embracing technology in all aspects of its operations, he explains. Companies "use it to recruit and retain both residents and employees, to improve their ability to serve their existing residents and to streamline operations and reduce costs."

Firms employ a broad range of strategies for incorporating technology into their operations, with smaller firms more likely to rely on out-sourced projects and consultants than larger firms. "Ultimately, there is no right answer as to how much a firm should be investing in technology. That depends on a number of factors that are largely unique to each firm, its business model and the markets in which it operates," the survey states.

With technology now a core part of the apartment industry's business model, "there is value to better understanding the level of the sector's investment in IT," Cardwell says. NMHC designed the survey to determine how much money and time apartment firms invest in technology.

Respondents spend 0.7% of their gross revenue on IT--not including telecommunications services. Of that, about 19% is spent on discretionary projects intended to improve revenue, 20% is spent on consultants and 12.6% is spent on outsourcing.

Smaller firms with average gross revenues of $35 million spend nearly 60% of their IT budgets on external resources--30% on outsourcing and 27% on consultants. Large firms, with average budgets of $377 million in gross revenues, spend just 2% to 3% of their IT budgets on outsourcing and another 15% on consultants.

When analyzed on a "spending-per-unit" basis, medium-sized firms--15,000 to 29,000 units--have the largest IT expenditures, spending $243 per unit. The largest firms--70,000 units or more--spend just $75 per unit on IT-related expenses, and smaller firms--9,000 to 14,999 units--spend $71 per unit.

Cardwell speculates larger firms may have lower expenditures because they were earlier adopters of technology and have already absorbed the large start-up costs associated with deploying new systems. "Mid-sized firms, on the other hand, may be closer to the roll-out phase--and the higher costs associated with an initial system deployment--while smaller firms have yet to pursue large technology initiatives," he added. Firms average one IT staff person for every 110 employees.