Considering wifi or cable to offset RUBS in 56 unit apartment complex

3 Replies

I am just about ready to implement water, sewer and trash submettering on a 56 unit complex. We completed a retrofit so that all units have a water main that is submettered. A separate company will do the meter reads, billing and shutoff as necessary. I am estimating that the tenant cost of water, sewer, trash and the meter read/rental fee will be $50-$70 per month for each tenant. This will be great for our NOI and we have implemented this system with great success in the past. This time around, we are in a market that is highly competitive. There are 4 other complexs around town and we all compete for the same tenants. They charge a flat $30 for water sewer and trash and I do not charge anything although my rents are a bit higher as my units are 1000 sq feet to their 700 sq feet. RUBS makes sense but I'm very concerned about springing it on the 50+ tenants and seeing a mass exodus and turnover. I'm considering compensating with the installation of wifi or cable. I know the liability issues of wifi but if it can be done right then all good.

The question is cost. I wonder the cost for unit of either wifi or cable. If I can do it for $10-$20 per unit then it would be a win win. I have not been able to find much information and will be calling the major providers shortly. Wondering if anyone has done such an install and the initial and ongoing costs involved.

@Serge S.  You should be able to find a package deal with a cable/internet provider if you are wanting to put all your units on their service. I doubt you will find something less than $30/month, and that would be the basic services only, just based on the size of the property. I would also recommend you go with broadband internet as apposed to cable TV. Today's tenants are watching Netflix and Hulu and could care less about cable service. Plus they can hook their Playstation or Xbox up. Cable is a dying entity and won't be seen as a perk for much longer.

Having said that, you might want to try the RUBS without offering anything for a month or two. Are you implementing the new RUBS as your leases turn over or renew? Or are you able to place the new charges on everyone at once? Maybe you could pay RUBS for each unit until it turned over or renewed, and test the waters. This might make your NOI go up much slower than you wanted, but would be better to test it for a few months than incur mass turnover (which is a lot more stressful on NOI than paying the water bill you already paid in the past).

Originally posted by @Serge S.:

I am just about ready to implement water, sewer and trash submettering on a 56 unit complex. We completed a retrofit so that all units have a water main that is submettered. A separate company will do the meter reads, billing and shutoff as necessary. I am estimating that the tenant cost of water, sewer, trash and the meter read/rental fee will be $50-$70 per month for each tenant. This will be great for our NOI and we have implemented this system with great success in the past. This time around, we are in a market that is highly competitive. There are 4 other complexs around town and we all compete for the same tenants. They charge a flat $30 for water sewer and trash and I do not charge anything although my rents are a bit higher as my units are 1000 sq feet to their 700 sq feet. RUBS makes sense but I'm very concerned about springing it on the 50+ tenants and seeing a mass exodus and turnover. I'm considering compensating with the installation of wifi or cable. I know the liability issues of wifi but if it can be done right then all good.

The question is cost. I wonder the cost for unit of either wifi or cable. If I can do it for $10-$20 per unit then it would be a win win. I have not been able to find much information and will be calling the major providers shortly. Wondering if anyone has done such an install and the initial and ongoing costs involved.

 Cable providers offers bulk packages for buildings. Check with a couple of them to see, which one will offer what you need. Read carefully their contract, and specially the termination clause to see how to get out of the contract with penalties in case you are not happy with the service.