WHITE PAPER
Five Ways Water Intelligence Can Boost the Value of Your Property Portfolio
Water intelligence delivers big bottom-line benefits for residential real estate companies.
For residential real estate companies, a property’s valuation isn’t set in stone. Instead, it’s a byproduct of the operating costs, current income, and future earning potential for any given property. Successful real estate investors don’t just buy and sell properties; they seek cost-effective ways to optimize profitability, driving up property values across their portfolio.
That’s why many real estate companies are now taking a closer look at their water-related costs. Over the past decade, water rates have climbed almost 55% nationwide, substantially outpacing increases in other utility costs. That’s enough to put a dent in any residential property’s bottom line—and when the pain is passed along to tenants, it can also lead to delinquent rent payments or drag down total occupancy rates.
At Metron, we’re deploying smart metering technologies to help real estate companies rein in water-related operating costs, maximize profitability, and increase the value of their portfolio.
With 600,000 high-resolution smart sensors installed nationwide—including smart meters at over 210,000 pads across over 2,000 manufactured home communities—Metron has a unique window into North America’s residential water use.
Using advanced analytics, Metron’s water intelligence solutions enable rapid leak detection, detailed monitoring and real-time alerts, more efficient maintenance, and dramatic reductions in water consumption.
That adds up to big savings for tenants—and can rapidly deliver tens of millions of dollars in new value for real estate investors.
Here are the 5 key ways that water intelligence can help your real estate business to maximize profits and boost property values:
1. Identify and remedy major leaks
With existing water infrastructure, property managers at most multi-family and mobile-home communities have little ability to detect even the most substantial water leaks. Adding smart meters in a submetering configuration can quickly help to identify and locate major leaks that occur between the master meter and individual dwelling units, or leaks arising within buildings or individual units.
After implementing a water intelligence solution, many of Metron’s customers rapidly identify large leaks that are increasing their water bills by as much as 30% or 40%.
One manufactured home park identified a single previously undetectable leak that was boosting overall consumption by 691,000 gallons per month, driving up the park’s operating costs by well over $10,000 per month.
Being able to pinpoint such “invisible” leaks and rapidly repair them delivers immediate ROI for real estate companies. With the ability to capture and clearly document bottom-line benefits via lower operating costs, companies can almost instantly realize substantial increases in overall property valuation.
2. Rein in water bills to boost occupancy
Every real estate operator knows that tenants—especially those in lower income brackets — are struggling with the cost of living. Nationally, the average mobile-home rent has climbed to $679 per month—up $46 from a year earlier. Average multifamily rent, meanwhile, has climbed to over $1,900—more than 25% higher than before the pandemic — leaving residents scrambling to make ends meet.
Seen against this backdrop, the consequences of climbing water costs are clear. All too often, high water bills can leave low-income tenants struggling to make rent payments — or can cause them to look elsewhere when looking for new accommodation.
This means managing water usage is vital as property managers seek to maintain occupancy, remain cost-competitive with rival communities, and maintain and increase property values.
With smart meters, individual tenants get the information they need to take charge of their water usage. Whether it’s taking shorter showers or fixing leaking toilets, tenants can make better decisions and proactively limit their exposure to high water rates.
At one mobile home park in Texas, for instance, tenants were paying around $400 a month in rent but were routinely paying another $240 for their water costs. Unsurprisingly, occupancy rates fell as residents sought cheaper options. When the park switched to Metron’s water intelligence, however, residents realized substantial water savings, sharply reducing monthly costs and putting the park on the path to full occupancy.
Across Metron’s network of customers, in fact, properties see a 25% average reduction in water costs after implementing water intelligence solutions. That drives immediate cost savings for residents—increasing tenant satisfaction, reducing turnover, and helping to ensure high occupancy levels across your property portfolio.
3. Reduce your reliance on RUBS
Many residential property managers use the Ratio Utility Billing System (RUBS) to divide up water bills among tenants. That’s an effective strategy if your only goal is to shift the cost of water from the property owner to tenants—but it doesn’t do anything to reduce the overall cost of water consumption.
A RUBS system typically uses a single central meter to track water use across the entire property, then simply apportions the cost of that water to tenants based on home size or occupancy levels. What RUBS doesn’t do, however, is provide any insight into or accountability over how or where water is being used or wasted.
With RUBS, in other words, tenants have no incentive to moderate their own water consumption, because the added cost of each extra gallon they use is split across the entire property.
If one tenant is overwatering their garden, leaving taps running, or taking frequent lengthy showers, the cost is borne by the community as a whole.
RUBS also gives tenants no meaningful way to identify and deal with minor leaks—and those leaks can accumulate to mean significant water losses. If a tenant’s toilet is running, for instance, they could be losing 6,500 gallons per month without realizing there’s a problem. Multiply that across an entire community, and the costs can quickly spiral.
With water intelligence, property managers can add per-unit submeters, or zoned smart monitors, to track water usage. Leaks can be quickly spotted, enabling residents to be alerted to problems or maintenance crews to be sent out to make targeted repairs. Bills can also be divided more equitably, based on actual consumption, giving residents the ability to take control of their own water consumption.
The result: an average 20-30% reduction in total water consumption compared to levels using RUBS, with more clarity and predictability for residents and lower costs for property owners.
4. Rein in your property’s sewer payments
It’s easy to focus on the cost of water when calculating the benefits of plugging leaks and reducing water consumption. Don’t forget, though, that in most jurisdictions, sewer costs are calculated as a fraction of total water use—so every gallon that spills from your water lines gets added to your sewer bill, too.
That means in many cases, addressing major leaks can shave tens of thousands of dollars off a large park’s monthly operating costs simply by reducing sewer bills.
That’s a big deal, considering that for an average household sewer bills account for almost 59% of total combined water-and-wastewater costs. In some areas, in fact, sewer alone can cost more than $170 per month for an average household—so any measures that property managers can take to reduce sewer costs can have a big impact on affordability and occupancy rates.
Using water intelligence lets property owners reduce sewer costs both by reducing overall consumption, and by eliminating big leaks that contribute to high wastewater costs.
Importantly, smart monitoring also opens the door to claiming rebates from municipal utilities. When a community can clearly document that hundreds of thousands of gallons per month were being lost to large leaks that never entered the sewer system, it’s often possible to request the recalculation of sewer bills—or to negotiate future credits to help offset the cost of repairs and maintenance.
5. Empower your team to work more efficiently
For property owners, managing water infrastructure effectively can feel like a tradeoff. On the one hand, effective management can eliminate the costs associated with excess water use. On the other, though, spotting and remedying leaks and other problems takes time—and on-site property managers and maintenance crews usually have a million other important tasks to attend to.
With Metron’s water intelligence solutions, your team can manage a property’s water infrastructure far more efficiently, helping maintenance crews to work smarter rather than harder, and freeing property managers to focus on other value-creating activities.
With advanced analytics helping to rapidly pinpoint leaks and other maintenance issues, work crews can implement targeted repairs far more quickly—without having to manually inspect each and every pipe or fixture across a property.
Previously undetectable pipeline leaks can be spotted and prioritized, delivering fast ROI and big reductions in water consumption. In-home leaks such as dripping faucets or stuck toilets can also be identified based on their unique water-flow signatures, enabling tenants or work crews to quickly make routine repairs.
Property managers can use the Metron WaterScope® portal to access data and analytics directly—or they can draw on Metron’s in-house experts to deliver the actionable insights and alerts they need. Using Metron’s WaterMasters™ membership program, teams benefit from dedicated Metron analysts who provide regular email or phone updates, helping to continually identify new opportunities to save water and reduce costs while ensuring that major leaks are spotted and addressed quickly.
With water intelligence, both property managers and maintenance teams can operate more efficiently—staying on top of your property’s maintenance needs and reducing water use without driving up operating costs.
What water intelligence means for property value
Add up the benefits from water intelligence—including reduced water costs, increased occupancy, and more efficient property management—and you’ll start to see real bottom-line gains that directly increase the value of your property portfolio.
At a standard mobile home park, property managers can recoup annual cost savings of over $180 per pad after switching to Metron’s water intelligence solutions. That directly impacts a park’s net operating income and boosts the asset’s total value.
In fact, switching to water intelligence can increase a property’s value an average of over $3,200 per homesite.
With mobile home communities currently selling for an average of $41,000 per homesite, that suggests many real estate companies could boost the value of their portfolio by as much as 13% simply by implementing a more efficient and intelligent water management
system.
For a mobile-home park with 200 pads, for instance, implementing water intelligence could boost total property value by $640,000. A property management company with a dozen such communities on its books, meanwhile, might see the value of its entire portfolio surge by around $7.7 million—dramatically increasing overall performance, boosting returns for investors, and unlocking new financing opportunities to fund future growth.
It’s time to talk to Metron
When you’re running a real estate company, every opportunity to reduce costs or boost occupancy is also an opportunity to boost the value of your property portfolio.
That’s exactly what Metron’s water intelligence solutions provide, offering property owners important new tools with which to cut costs, improve conditions for tenants, and unlock significant unrealized value across their property portfolios.
So get in touch today—and find out how Metron’s advanced water analytics can take your property portfolio to the next level.