Think of an industry that comes with a lot of paperwork, daily hassles and monthly negotiations and you’re probably looking at property management, where communication between tenants and landlords or on condo boards can be difficult and strained at the best of times.
According to CEO Joseph Nakhla, that’s where Tribe Property Technologies (Tribe Property Technologies Stock Quote, Charts, News, Analysts, Financials TSXV:TRBE) comes in.
With an aim of bringing digital transformation to a sector that really needs it, Nakhla says Tribe has been focused on both the education and communication aspects of property management as well as efficiencies to be gained through digitizing operations via its platform.
In an interview with Cantech Letter, Nakhla says the progress for Tribe, which went public earlier this year, has been about modernization in an industry deeply in need of it.
“We started by really hoping to digitize all that is strata living or condo corporation living. And we worked with the real estate developers who are actually building these brand new communities. We give them tools, digitize all of them and then once they’re completed and the homeowners move in, we started to build specific features regarding the way people live in these communities,” Nakhla said.
“And then 2018, we really realized that a big opportunity exists where we can actually deliver the full property management service on top of the technology we’ve built. It’s been a long, amazing journey supporting so many homeowners over the years and here we are.”
On condos, Nakhla said the best way to think of a strata or condominium is as a corporation, a group of homeowners contributing funds for maintenance and protection of the corporation’s assets, along with planning for the future. The picture gets more complex when you figure in federal and provincial regulations as well as condo rules, insurance and so forth, adding to a lot of information that needs to be clearly communicated and tasks completed within the organization.
Tribe’s technology involves education of homeowners as well as aspects such as cash collection and payments and ongoing maintenance. For the rental market, Tribe delivers similar tools in terms of communication between landlords and tenants on rights and responsibilities and payment tech.
Overall, Nakhla sees Tribe as taking part in a larger modernization of an industry that he says hasn’t seen significant change in decades.
“On communication, we look at a lot of companies, even companies we’ve acquired over the years that are very, very paper heavy. And what we’re trying to do is not only digitize the paper and the information but actually to connect the dots and create workflows and streamline them. I would say that’s probably the heaviest lifting that we do,” Nakhla said.
Tribe launched as a public company on the TSX Venture Exchange in March of this year, which came after the acquisition of Gateway Property Management at the end of 2020, which allowed the company to grow its presence out of British Columbia and into Ontario and Alberta along with giving it a position in the rental management market.
Tribe has since continued its M&A with the acquisition of the rental portfolio from BC-based KEY Property Management and, last month, an announced agreement to buy the property management portfolio from BC Interior’s Powder Highway Management Group.
And Nakhla sees Tribe’s M&A as a key element of the company going forward in that it plans to consolidate in the highly fragmented property management space.
“There are 13,000 property management companies working in our space in Canada and in the US alone. So, there are a lot of opportunities to actually consolidate these companies and create a service base, technology and otherwise, that can actually satisfy the tremendous growth we’re seeing in the industry in terms of the demand on service,” Nakhla said.
“But the organic side of our business has grown significantly [as well]. We have a digital strategy from a lead generation point of view to education, to conversion from a lead to a customer, and our numbers just keep getting stronger quarter over quarter. So you’ll see us be very aggressive on both fronts,” he said.
On the financial front, Tribe reported its second quarter 2021 in late August, showing revenue of $3.97 million, up a huge 244 per cent year-over-year, and gross profit of $1.98 million, also up 274 per cent compared to a year ago. The company’s net loss was $1.6 million compared to a loss of $958,117 a year earlier, while adjusted EBITDA was a loss of $981,282 compared to positive $48,695 a year ago.
Tribe’s business picked up considerably over COVID-19, with Nakhla noting the essential role that property management has played in supporting home owners and renters during the pandemic, with the company now servicing over 40,000 homes.
“[I have] a tremendous amount of gratitude for not only our staff but the industry staff because many of these buildings have had people who really needed us to step up and actually be there for them to ensure that their home is protected and safe and their communities are still operating,” Nakhla said.
“[The pandemic] impacted Tribe specifically by way of increasing the number of communities that wanted to come to our digital strategy approach, our technology first approach, so we actually saw a big uptake of communities that are actually wanting to move from a traditional property management model to a model whereby digitally they can do a lot more for themselves,” he said.
Nakhla also spoke of Tribe’s expanding partnership program where the company links up with other organizations to support efficiencies and buying power for home owners, landlords and renters. Last month, for example, Tribe announced a partnership with Pensio Global, a credit risk management and rental income guarantee company.
“These are what we call digital partnerships whereby [we partner with] amazing organizations and companies that are building some great technologies, services and solutions that we believe every home should look at in lending, insurance but even in grocery delivery and smart home and smart building technologies that can really lower the footprint and operating expenses of these communities,” Nakhla said.
“You’ll see [Tribe] doing a lot more of these partnerships and investments, and bringing in and curating best offers to our home owners,” he said.
Disclosure: Tribe Property Technologies is an annual sponsor of Cantech Letter.