In this episode of The Report, Alex Howe, SVP Marketing + Growth at Funnel, and Tyler Christiansen, CEO, Funnel, recap the biggest conversations coming out of Apartmentalize in New Orleans - from AI orchestration and centralization to housing policy, REIT consolidation, and interest rates.

They also cover several major industry stories shaping multifamily right now, including:

• AI accountability: Why AI adoption is shifting from excitement about automation to accountability, governance, clean data, human oversight, and real resident experience outcomes.
• Property management software expansion: Why some AI-first companies are moving toward accounting and PMS software
• Housing legislation: What the latest bipartisan housing bill could mean for operators, renters, and the broader affordability conversation.
• Constrained investment volume: Why multifamily transaction activity remains cautious, even as operating fundamentals show signs of stabilization.
• Centralization's comeback: Why operators are revisiting centralization with more pragmatism, clearer goals, and a sharper focus on measurable efficiency.
• AvalonBay and Equity Residential merger: What the $69 billion REIT merger signals about scale, shared services, centralized operating models, and the future of mega managers.
• Interest rates and development: How the Fed's latest decision to hold rates steady could continue to pressure new apartment development - and why that may set up future rent growth volatility.

For more on Funnel's Apartmentalize announcements: Workflow Studio, Funnel's custom renter workflow builder. Watch this video: https://www.youtube.com/watch?v=P5cFdtOyhQI

For the results of a third-party blind user test where 169 real renters compared Funnel's chat and voice AI against three major competitors. Read the press release, or listen to this episode of the report.

Follow:

• Tyler Christiansen on LinkedIn
• Alex Howe on LinkedIn

Subscribe:

• Multifamily Unpacked podcast
• Multifamily Unpacked newsletter

Episode transcript:

0:00 The Report: Apartmentalize + AI orchestration

Tyler Christiansen: "Orchestration" is the buzzword of the year. And for those who aren't familiar, much like all buzz terms, there's fluff and hyperbole and reality all mixed in together. In Funnel's case, the reality is what we call Workflow Studio.

I think over time, like all new technology, it will really expose those who have been working on it for a while: Do you have solid APIs? Do you have strong relationships with other vendors? Or are you trying to have a walled garden and have maybe an agentic experience, but much less an orchestrated agentic experience?

And it is the number one reason AI pilots fail: you don't have a clear objective and you're not getting the data that you need, right?

So if you, for instance, are deploying an AI scheduling tool or AI renewals tool, it is critical that you have the right information to be able to communicate with that renter. Otherwise, you're just creating duplicative or redundant work.

I think that all of us, as we deploy AI technologies, are no longer impressed by the fact that you threw AI on it or that it has a little loading widget, right? What excites people is: does it actually get work done for me?

1:08 Introduction

Alex Howe: Welcome back to Multifamily Unpacked. On this episode of the report we're coming off Apartmentalize in New Orleans, where the big conversations were AI, centralization, and a new buzzword that's becoming more common: orchestration.

In this episode, Tyler and I unpack what we heard on the floor at Apartmentalize, why orchestration is more than just another flash in the pan AI concept.

We get into the latest news including calls for greater AI accountability, federal bills around housing supply, REIT consolidation, latest interest rates heading into the back half of the year, and how operators are thinking about these shifts.

Roll the tape.

1:52 The new industry buzzword: Orchestration

Alex Howe: Last week, we gathered in New Orleans as part of the Apartmentalize conference. If you didn't feel like you were in the middle of a soccer game, you somehow missed our booth. We had an AI goalie simulator.

We had the games on. We also announced Workflow Studio, our custom renter workflow builder, as well as the results of a third-party blind user test where 169 real renters compared our chat and voice AI products against three large competitors. Spoiler alert: we won all six tests. For more on that, check out the link in the show notes.

Some of the themes I personally heard were, of course, soccer and the World Cup, but also tons of folks were talking about this new term: orchestration. Tyler, let's get into that term and some of your other big takeaways from Apartmentalize.

Tyler Christiansen: Yeah, thanks, Alex. Apartmentalize is always a great time. In particular, once every four years it falls on World Cup season, so I've got some really fun NAA memories over the last 12 years with World Cup mixed in. I loved the event, and I loved that it wasn't in Vegas.

But you're right-"orchestration" is the buzzword of the year. And for those who aren't familiar, much like all buzz terms, there's fluff and hyperbole and reality all mixed in together. In Funnel's case, the reality is what we call Workflow Studio. I'm going to highlight this as an anecdote to help people understand what it can be.

Obviously, most of Funnel's customers use us for AI communications, human-based communications, and scheduled communications when tours are scheduled and applications are submitted. Historically, the timing, cadence, and logistics were all behind the scenes-stuff that Funnel would manage for you.

We've been underway with our partners in moving those toggles forward so the end users at our partners-like Greystar and BH and Camden-can pull the levers themselves.

What AI orchestration does is you begin to think about, "Okay, I've got all of these different controllables within my software. What if I really wanted to be able to command in normal vernacular inside of an LLM, like a Claude or a ChatGPT, and say, 'Hey, I'd like to adjust my marketing campaigns in Funnel. I'd like to be able to look at the Built points, connect to my Build account, connect my HappyCo account.' So when somebody's work order is completed, Funnel's going to send a communication that your work order's been completed.

They don't know it was in HappyCo. They just know they got an email. And, oh, by the way, I also want to tag in a trigger to get them some Built points.

The idea here is that you're really empowering operators to have their hand at the wheel. And I think I heard a lot of optimism from vendors that this could genuinely mean better integrations. It can mean putting the control into clients' hands.

Net-net, super exciting. Our Workflow Studio is our V1 of this-where we're empowering our customers to set really differentiated customer journeys. But I think over time, like all new technology, it will really expose those who have been working on it for a while.

Do you have solid APIs? Do you have strong relationships with other vendors? Or are you trying to have a walled garden and have maybe an agentic experience, but much less an orchestrated agentic experience?

5:08 Other themes from Apartmentalize 2026: AI is not just a chatbot

Alex Howe: Yeah. The way I heard somebody talk about it that made sense for me is: a single system of action that integrates with lots of systems of record and is one place that can really orchestrate everything you need to do. That was obviously a big theme we heard a lot about.

You had a ton of meetings both at the booth and outside. What other themes did you hear about in AI, centralization or otherwise?

Tyler Christiansen: I just talked about the buzzword of this year. The buzzword of the last 12 to 24 months was agents, right? And so it was interesting hearing our clients really talk about the concept of agents and saying, "I'm trying this agent, I'm trying that one."

And it's encouraging that folks recognize that AI is not just a chatbot, right? It is, in fact, many different applications that should be experimented with. And in particular, that an agent is not simply a question-answerer, but it is a tool that conducts and executes work on your behalf.

And so that was a really exciting theme-whether it was things completely unrelated to Funnel, like how you're doing your payables, how you're doing your compliance, or if it was, once again, the renter experience, the leasing experience-that people are really excited about experimenting.

And for vendors, it's very clear that this evaluation of AI tools will be ongoing. This is not going to be like the V1 cloud era: "I picked vendor Y for my accounting software and I'm with them forever."

These agent tools, especially in an orchestration world, are going to be highly interchangeable, right? And so you need to be able to have a platform that is open, and in particular, continue to hold your vendors accountable to: Is this the best-in-class tool today and going forward?

So to your point, Alex, we're really proud that our AI agents-in particular, kind of prospect and resident tour scheduling renewals-we won this blind case study that we participated in because ultimately people are testing these tools. And if they don't get the results, there are a lot of options and competition for the next generation of AI agents.

7:00 AI vendors adding accounting software. What does this mean for property management software?

Alex Howe: Pretty much every company that comes to NAA-and I think this is true in other industries-they make big product announcements. Some of the companies that started in AI are starting to add in accounting software, really growing into property management software.

Tyler, I know you lived through the days at Entrata when they decided to sell property management software and had your own war stories. How do you see this playing out for those companies today trying to move there?

Tyler Christiansen: Yeah, this is a back-in-time NAA story that's going to date me. My first NAA was in Boston in 2012. Back in the day, I worked at a company called Property Solutions, who at NAA 2012 announced that a stealth product-as it were-that had been marketed called Entrata was, in fact, owned by Property Solutions, right?

So it kind of came out and said, "Hey, that's our product. That's our accounting software."

Obviously today, Entrata is approaching an IPO, and so started from there as a roughly $30 million company-now a $500 million company 12 years later, 14 years later. So, cool journey that they've been on.

Having lived through that, it is a very unique transition to go from being a kind of best-in-class point solution to, as folks would describe it, a specialized solution. In that case, PSI was websites, it was payments, and then became all things.

What's really unique and why we decided not to make that decision-and highlights the challenges-is that most operators don't come to NAA and say, "I can't close my books," or, "I really don't love my accounting software." They may have challenges with that, but I learned through hard experience that probably only about 5% of the market any given year is willing to change that tool.

Where most of the pain is around the renter experience: the leasing journey, the renewal journey, the maintenance journey-which is why you see a few large, deeply embedded property management softwares that are very good at closing out the books. They're very good at all the nuance that goes into accounting software.

A lot of innovation around the periphery of debits and credits may not be the innovation area; leasing and AI may be.

And so we really decided: we would rather not compete with full-stack accounting software, but rather partner with, augment, amplify the capabilities that you get in a Yardi Voyager, in a RealPage OneSite, so that we are able to focus on one mission, which is creating the world's best renter's experience and competing with those PM softwares and their offerings.

It is absolutely a departure, but not one that is new. So I think anybody who's saying, "Whoa, look, vendor Y is getting into this accounting software game. Wow, it's going to be amazing"-it has happened before, and again, to Entrata's credit, they really ground out a viable full-stack accounting software offering, and I know the folks over there should be proud of that.

But it is absolutely something in which you kind of end up on a full-stack island.

Our big bet is in the AI agentic orchestration world. People are going to want to have their optionality. They don't want to leave their wonderful PM software solutions that they have that do work.

The best thing I've heard folks say when I would sell them accounting software is: "If I get to the other side and it doesn't break, I win. I'm not expecting any improvements. I just want it to not break."

But allow folks to stay on those PM softwares and then really deploy the value, which is in the agentic workflows, the automation opportunities, and improved renter experiences.

10:22 Why AI adoption needs special accountability

Alex Howe: Let's jump into some articles of late. Of course, a ton of them focused on AI. Multi-Housing News did a special report from Apartmentalize on why AI adoption needs special accountability.

So the article centered on themes that AI adoption is shifting from excitement about automation to accountability. Industry leaders emphasize in the piece: AI is only as good as the data processes and governance behind it, and success ultimately depends on clean data, clear ownership, human oversight, and ensuring technology enhances and doesn't replace the resident experience.

So as we further expand our use of AI, and our customers do, how do you see them balancing AI with maintaining a high-quality resident experience?

Tyler Christiansen: Yeah, this is awesome. In fact, we're going to tie together our last two topics, Alex, that you tossed to me.

First, I mentioned at Apartmentalize that folks are getting comfortable not only with the term "agents," but deploying them and holding them accountable: Did it work? Did it do the thing that I hired it to do?

And this study nails what I heard a lot of operators tell me: the data matters, right? If you are an AI solution and you're only talking to the accounting software once a day, the answer can't be, "I'm going to go build an accounting software for you." The answer should be, "No, sync regularly, speak clearly, make sure the two systems are working together."

And it is the number one reason AI pilots fail: you don't have a clear objective and you're not getting the data that you need, right?

So if you, for instance, are deploying an AI scheduling tool or AI renewals tool, it is critical that you have the right information to be able to communicate with that renter. Otherwise, you're just creating duplicative or redundant work.

I think this trend is not so much a trend as it is just a new normal. I think that all of us, as we deploy AI technologies, are no longer impressed by the fact that you threw AI on it or that it has a little loading widget, right? What excites people is: does it actually get work done for me?

So I know, Alex, you're a big fan of Claude CoWork, and you will put together a deck for me on the fly, right? But that's a great step in the direction. We still have wonderful folks on our team building out those graphic designs.

And I think that ultimately all these AI agents which are being deployed need to access the data cleanly and, importantly, need to deliver outcomes. So we're seeing that in our industry for sure.

Alex Howe: My Claude CoWork decks, by the way, are never quite as good as our team does it. So shout out to those guys.

Tyler Christiansen: They're pretty far off, I'll be honest. But yours are good.

Alex Howe: They're a good starting place.

12:51 Congress passes ROAD Housing to Housing Act

Alex Howe: There was an article in The Hill this week: "Congress finally set to pass a housing bill." So here's what it would do. The Senate's advancing a bipartisan housing bill aimed at boosting the housing supply, which they've tried in the past.

Key provisions of it: it would incentivize local governments to build more housing. It would speed up approvals, expand manufactured housing, redevelop vacant properties, and limit large investors from buying new single-family homes.

Supporters of the bill see it as a step toward addressing housing affordability, but it doesn't include significant new housing funding.

Friend of the pod Jay Parsons shared on his Rent Roll podcast that, yes, newer iterations of this bill are improved from the original draft, but it's still a real challenge for owners and operators.

Efforts to increase housing supply, and by increasing supply, assisting renters with affordability-that's not political in any way. One thing we tend to say: it's not a red or blue issue. This is a human issue.

So Tyler, this obviously isn't specifically in our world. It's more single-family rental. But have you heard any operators talking about the newest iteration of this bill?

Tyler Christiansen: Yeah, I think you nailed it when you say our friend Jay has really chronicled this, so everyone please follow him.

But I would only add that just because we got to a better outcome doesn't mean it's a net positive. We, for one-I know at Funnel-are very much in favor of anything that brings attention to housing shortages in America and that we need more supply. But ultimately, anything that deteriorates the incentive for more housing is a negative.

So still murky, and I think it is absolutely, in my conversations with operators, in the category of things that are not helpful if we're trying to get back to a healthy multifamily environment.

And in particular, it's just you feel like you're in a little bit of the bizarro world because we're trying to solve a problem that has been so clearly demonstrated to be solvable.

Rental housing prices are flat-and by any measure down-in any market where there's been any sort of serious development. So certainly across the Sun Belt, we've seen rental prices come down relative to other costs.

And so it's just, again, bizarre to think that we are spending so much time thinking about ways in which we could increase supply when, in reality, it was working very well. And there's a lot of factors that have set it back.

So anyway, happy to see that it's not as damaging as was once laid out to be, but hopeful that we continue on a better trajectory towards really just encouraging the market to build and let that be the way that we continue to have affordable rents in America.

15:17 Breaking down the 2026 Yardi Matrix National Multifamily Marketing Report

Alex Howe: Good segue. Yardi puts out their Matrix National Multifamily Marketing Report. Their most recent one came out on June 15th.

Investment volume is still constrained, so multifamily investment volume is down 10.7% year over year for the first five months of 2026, which obviously reinforces the transaction market is still very cautious even as some operating fundamentals are starting to stabilize.

Monthly rent showed about a 0.3% increase, so nearly flat. As fewer properties are trading right now, what are operators most focused on improving? Is it centralization efforts, cost control, or really leaning into AI? And what's the biggest change you're seeing?

Tyler Christiansen: Yeah, I think we're getting back to a place where folks have tried pretty much everything.

I am happy to see centralization coming back as a very important topic du jour. I think that as rents were falling, centralization was having its biggest moment in multifamily.

Unfortunately, especially in the third-party world, a lot of folks blame centralization for falling rents, which-saying it out loud-makes it very obvious that it was dumb to think that, or it is dumb that operators who think centralization doesn't work. There's a reason why the REITs keep doing it and are never going to quit it.

And so I think you see a lot more folks revisiting the concept of centralization. Now, they're doing it more cautiously, right? This isn't 2021 with rents growing like crazy, and so folks don't want to disturb or upset the apple cart if they can avoid it.

But that is a real trend that we're seeing: centralization was everything to everybody, and then when rents fell, people blamed it if they were experimenting with it, and the panacea was going to be AI.

I think similarly, folks have said, "Hey, I want to keep the AI, but it is not a panacea. It's not going to make my rents grow, and it just makes me more efficient."

I think that folks now are really being much more pragmatic about what is an iterative step that has tangible benefits. And so we're seeing operators that are really getting clear about the outcomes they're looking for in their technology pilots and their restaffing models and their technology vendor selection.

Now, I think there's a lot more intentionality than we saw in previous iterations where it was all centralization, all AI, and then folks were disappointed when it didn't deliver the results.

I think it feels to me, Alex, like the multifamily operators have embraced the stats that you were just saying. It's a long, hard winter. We're not expecting it to get better, so we're going to continue to ration out our improvements and meter those because they're not going to-rent growth is not coming back like a giant wave anytime in the near term.

17:43 AvalonBay and Equity Residential announced a $69 billion merger

Alex Howe: You mentioned REITs at the beginning of your response just now. AvalonBay and Equity Residential announced a $69 billion merger, creating a 180,000-unit apartment REIT. Their pitch was scale, shared tech overhead costs, and better efficiency. Analysts say it's unlikely to directly raise rents given that the market is still pretty fragmented.

So historically, we had a ton more REITs than we do today. Today there's around six large REITs. Do you see this merger as a one-off? What problem are these two companies really solving with scale? Is it tech costs, the cost of capital? Are they really defending against going private?

Tyler Christiansen: Yeah, great question. We're a little late to this story with all that was going on in our world, but super excited to see deals moving in our industry.

And to correct what you said earlier: there were six REITs. There's now five big ones. To be clear, Funnel works with four of the five REITs in multifamily, and so we are really proud of that stat and proud of the fact that we have helped a lot of those operators implement AI, implement centralization.

And I do think that we've talked about this before on the show, Alex, that mega managers is absolutely a trend. Jay Parsons often references the fact that managers used to be much bigger than they are today, at least on the ownership side. And so I don't think we're done seeing owner-operator scale.

I think we will see more deals like this-not necessarily REIT-to-REIT mergers, but a lot of our owner-operator clients, they're trying to grow. And this is really great validation that centralization does benefit these operators.

If you had 200,000-plus units or 100,000-plus units, 50,000-plus units, but you are running each property as an individual asset, who cares? Who cares that you have this big giant portfolio of assets? It does you no good. It's just like Ford having a million car dealerships. There's no economies of scale because they weren't sharing resources across those.

Tesla gets economies of scale because they share resources across their different showrooms, right? Because there's one brand that I buy from.

And so it is cool to see operators realizing: if I have shared services, I have a centralized operating model, there really is value in getting larger.

Now, it's a separate question whether or not the public markets will reward them for that right away. Early returns are: it's not like the AVB/EQR stock popped tremendously on the news. It's going to be shown over time.

But if you can really improve your unit economics and get those economies of scale-having a GM covering an entire city and a sales team and a maintenance team-and those ratios continue to improve as we see attrition at the properties, like we've seen Camden do extremely well in their markets, I think you'll see more of this.

So while I think most other REITs and most analysts don't say there's a wave coming, I do know for a fact that every owner-operator who has found value in centralization-every one of them wants to be bigger.

And so as the dynamics of interest rates and purchase prices adjust, we will certainly see more of this when the economic environment provides it to be possible.

And of note, the reason it's particularly possible in REIT world today is that REIT prices are so depressed, right? Public markets are not the same as private markets, but I think the private markets will see a lot of these type of deals when the environment comes back.

21:00 How do recent fed interest rates impact multifamily

Alex Howe: Let's close with a story about interest rates. So the Fed met most recently last week. They held interest rates steady, and they even hinted at some future rate hikes.

The reasoning was inflation is back above 4%, largely driven by an energy supply shock tied to the Iran conflict. The new Fed chair, Kevin Warsh, emphasized an aggressive anti-inflation stance, and he launched new task forces to rethink how the Fed communicates and tracks inflation.

How is this going to play out in multifamily?

Tyler Christiansen: By and large, when we now have years of data of interest rates being higher than they were in the ZIRP era, it hasn't had a direct impact on rent growth or renter demand per se.

The bigger thing, of course, is that it has an impact on the homebuyer market, which is slow, and we as a rental housing market want home sales. It creates movement in the housing environment, and that is good.

But the bigger thing is that we just aren't seeing people build apartments. That's the number one problem with the high interest rates for our sector.

So while I have no commentary, it seemed to make sense that, yes, inflation is creeping back up and so not surprised.

I don't think anybody was surprised to see interest rates stay steady and, in fact, be fear of going higher or be discussed going higher.

The bigger problem generally is that we're not building enough housing. Now, the opposite side of that coin is that it is only a matter of time before rent growth comes back.

Anybody who wants to be in multifamily 20 years from now-which I'll raise my hand and say I still want to be doing this job-we don't want to just have this crazy seesaw effect of zero rent growth, 20% rent growth. That will lead to bad regulation.

And what we discussed earlier is we could get really bad regulation if we just go 0-20 all the time.

So while I think a lot of folks are excited about the idea that new apartment starts are down and therefore certainly at some point my deal that I penciled in 2022 is going to run profitably or have rent growth, I know the asset managers I talked to are excited about the idea of having some rent growth finally.

But it is a little concerning that if interest rates continue to stay high, new apartment development stays low, that we might see-it's frankly probably more of a question of when than if we see rent growth swing to a probably, again, boom times.

We're going to see a lot of apartment operators grow. We're going to see a lot of deals change hands then.

But as somebody who is now getting gray hair, I'd love to see us get back to anywhere between 3% to 10% rent growth. That would be probably a more sustainable world.

So anyway, obviously something we'll continue to watch because it will have a direct impact on the overall housing market and certainly the rental housing market.

Alex Howe: That is it for this episode of The Report. We will talk to you all next month. Thanks, Tyler.

Tyler Christiansen: Thanks, Alex.