Published on March 20th, 2025
By Megan Eales Monroe
Based on insights from over 2,000 property management professionals, the 2025 AppFolio Property Management Benchmark Report reveals what’s on the industry’s mind, explores top industry threats, and reveals how real estate management businesses are shifting strategies to stay ahead. On this episode of The Top Floor, we wanted to dive deeper into some of the report’s most critical findings, so we tapped into the insight of Moses Kagan, co-founder and president of Adaptive Realty.
Since 2011, Moses and the Adaptive Realty team have not only successfully navigated a complex and competitive Southern California real estate market — they’ve thrived in it. Now, he shares his unique perspective on the latest market trends, reveals his forward-thinking business strategies, and imparts practical insights for turning upcoming industry challenges into new opportunities.
Tune in now to hear Moses’ take on what’s in store for property management in 2025, and download the 2025 AppFolio Property Management Benchmark Report for even more data-driven insights into the year ahead.
Listen Now
Meet Our Guest
Moses Kagan
Moses Kagan is the co-founder and president of Adaptive Realty, a Los Angeles-based real estate development and management company that is laser-focused on managing high-quality, Southern California real estate on behalf of long-term owners. Originally founded in 2011 with no outside capital and just 32 apartments under management, Adaptive Realty has since grown to own more than $200 million of real estate and manage more than 1,100 units for itself and other property owners.
In addition to co-founding and leading Adaptive Realty, Moses is also a seasoned real estate entrepreneur and investor. Not only has he renovated more than 100 apartment buildings since 2008, he also helps foster a strong community of Los Angeles real estate professionals with Reconvene — an “un-conference” for real estate operators and passive allocators — and ReSeed, a platform designed to break down barriers for talented real estate professionals on the path to building their own businesses.
Episode Transcript
Megan Eales Monroe:
Welcome to The Top Floor, the real estate management podcast that’s dedicated to keeping you one step ahead of industry trends with expert advice and actionable insights. I’m your host, Megan Eales Monroe. Together, we’ll dig deep with today’s property management leaders and industry change-makers to help you unlock new possibilities, transform your day-to-day operations, and grow your business. And, no matter the size or type of portfolio you manage, we’ve got you covered here on The Top Floor.
Although we’re just a few months into 2025, current market dynamics signal a challenging year ahead for real estate management. The good news is that these challenges also present opportunities to innovate, streamline operations, and deliver more value to property owners and residents
To better understand how businesses are shifting strategies and planning to navigate the year ahead, we surveyed more than 2,000 property management professionals. Their insights are available now in AppFolio’s third annual Property Management Benchmark Report.
In today’s episode, we’re digging deeper into some of the report’s key findings for 2025 with Moses Kagan. Moses is president and co-founder of Adaptive Realty, as well as a co-founder of Reconvene, the “un-conference” for real estate operators and passive allocators.
Together, we’ll explore what’s on the industry’s mind, and see how Moses and his team at Adaptive are shifting strategies, finding new opportunities to stay ahead, and innovating their way into 2025.
Before we jump in, don’t forget to download your copy of the 2025 Property Management Benchmark Report so you can explore even more insights and findings than we can cover in today’s episode. The report is available now at appfolio.com/benchmark. We’ll also make sure to provide a link in the show notes.
Megan Eales Monroe:
Hello, Moses. We are so excited to have you with us for this episode of The Top Floor. Thanks so much for joining us.
Moses Kagan:
Megan, I appreciate you having me on.
Megan Eales Monroe:
For our listeners who aren’t familiar with you and Adaptive Realty, can you please tell us your name, a little bit about yourself and your business?
Moses Kagan:
Sure. My name is Moses Kagan. I am co-founder, and I guess the person with whom the buck stops, at Adaptive Realty. We are a Los Angeles-based real estate development and management company. We own about $200 million worth of apartment buildings with investors. And we manage a lot more real estate for third-party owners. So we’re at roughly 1100 units total between our own and third-party business.
Megan Eales Monroe:
Okay, cool. And obviously you’re operating in L.A.. We were really glad to hear none of your properties were directly affected. And we just wanted to say we’re hoping for the best for you and the community down there.
Moses Kagan:
Yeah, it’s been pretty crazy here. The damage is mostly localized in Palisades and in Altadena. But there’s people, there’s jobs, and all kinds of stuff. We fortunately dodged direct impact, but the city’s definitely in trouble.
Megan Eales Monroe:
Yeah. Well, is there anything else you want to share about you or your company? Maybe you could share a little bit about the fantastic real estate event that you run?
Moses Kagan:
Sure. Happy to do that. And thank you for teeing me up for that. My wife and I, five years ago, started an event called “Reconvene,” where we brought together a few hundred real estate operators and passive investors in Southern California. This year, it’s going to be September 16th – 18th in Santa Monica. We get together to discuss business deals, different asset classes, different ways of financing things. And the idea is to build relationships between operators and also between operators and passive investors who are interested in finding new people to invest with.
Megan Eales Monroe:
Yeah, that’s great. So, let’s dive in. We are here to talk a little bit about some of the findings from AppFolio’s most recent survey, the 2025 Property Management Industry Benchmark Report. We surveyed thousands of folks in real estate, specifically property management, to learn a little bit about what’s on their mind, what’s keeping them up at night, and how they’re adjusting and shifting their strategies in 2025. So, I would love to hear your take on a couple of our findings.
Moses Kagan:
Yeah, let’s do it. And I think, by the way, it’s so valuable to do these kinds of surveys. I mean, anyone who is in property management knows it can be a little bit of a solitary business. You’re talking to your employees and your leasing agents and contractors and stuff. But many of us don’t do enough talking to our peers, in part because they’re our competitors sometimes. And so it’s really helpful to get some feedback from a bunch of our peers so that we kinda see what we’re all going through, at the same time.
Megan Eales Monroe:
Yeah, that’s definitely the goal. One of the things that we ask in our survey is around the top threats that teams are anticipating. We got some interesting data about year-over-year change. We saw some threats that decreased and became less of a concern. And then, on the flip side, some threats jumped up and are more concerning in 2025. So I would just characterize the shift as moving from macroeconomic concerns to more industry-specific, operational challenges. So, what we see is inflation was one of the top threats that decreased. High interest rates, labor shortages and supply shortages … those decreased from 2024. And then for threats that increased, at the top of the list was maintaining high occupancy rates, insurance costs, increases in taxes, government regulations, and the overall challenge of maintaining positive NOI.
Moses Kagan:
Yeah. Happy to talk about all of it. I want to start out by saying that everything I say is primarily the result of my experience and running buildings specifically in L.A. I’m involved in some other stuff in other markets. I’m on Twitter and LinkedIn and everything a lot. I’m in touch with a lot of other operators in other places. But the stuff I own and directly manage is in L.A. So, everyone listening to me should filter what they hear through that perspective. Which one of those do you want to begin with?
Megan Eales Monroe:
Let’s start by talking a little bit about occupancy rates. In your opinion, what’s driving that increase in concern over occupancy rates?
Moses Kagan:
Well, I’ll tell you in L.A. what’s going on. There’s two things. One is, like other places, we have experienced a bunch of supply growth over the last couple of years. This is principally the result of projects that were permitted and financed during the zero interest rate years — ‘20 and ‘21 and the first half of ‘22 — that are now delivering. And L.A. did not experience the kind of supply wave that, for example, Austin or Phoenix did. But in a market that generally delivers very few apartments, we got much more than we usually do. And all of those owners are trying to lease up and refinance or sell.
So we’re offering all kinds of concessions, which have a ripple effect down through the entire chain. So that’s one of the issues that we’ve all confronted. And it’s something that we felt in our business. The other thing in L.A. is on the demand side. Hollywood production in L.A. has been absolutely crushed. It got hurt during COVID but came back as a result of the interest rates being so low, candidly. And then about 18 months to two years ago, production in L.A. really fell off a cliff.
And that impacts the people that you think of: The actors and the screenwriters and everything. And we actually have plenty of those in our portfolio. But there’s a whole bunch of other people whose livelihood depends on Hollywood, like caterers, and makeup artists, and set designers, and location scouts, and you name it. And the decline in local production has really hurt a lot of those people. There’s people leaving L.A., there’s people leaving the business. That has had a major impact on demand. So, the result of those two, the supply and demand effect, rents have been down. It varies by neighborhood. And the better areas have probably held up a little better than the more marginal ones. But I would say easily five to 10 percent real rent declines. As a result of those two factors, that kind of gives you a good sense of the field of play.
Megan Eales Monroe:
Yeah. Thanks for that context. It’s actually great to hear on a more local level how some of those trends are driving occupancy. And even for listeners who are in other areas, this is still a concern. So do you have any advice, or maybe any strategies, that you have used to help keep that occupancy up?
Moses Kagan:
Sure, yeah. Happy to talk about all of that. So the first thing to say is that, in our portfolio — both the stuff that we own and also the stuff that we manage for third parties — we are all long-term holders. We do not work with people who flip buildings. One of the results of that is that we care very much about the actual NOI, the actual cash flow that we deliver.
For us, the most important thing has been to keep abreast of the trends in the rental market and adjust rents appropriately. It doesn’t do you any good to reach for that extra hundred dollars and have your $3,000 apartment sit vacant for an extra month. If you’re a long-term owner, you never get that $3,000 back. You know what I mean? You lost that by having the unit sit there. So, we’re very focused on responding to the market. One of the things we are doing is constantly gathering data from our leasing agents for each vacancy, regarding the number of inquiries and tours and applications that they’re getting. And I’m personally reviewing that data at least weekly, and sometimes more than weekly, and adjusting rents as appropriate.
Megan Eales Monroe:
Yeah. And I’m sure your approach to maintaining the property for the long term also helps there, too.
Moses Kagan:
Yeah. We’re really sticklers for that. I think if you’re gonna own stuff for the long term … it’s obvious, but you have to maintain it. Obviously, you have to maintain the roof and things like that. But you really want the building to stay as nice as it can and to keep cranking out market-leading rents. And a lot of these areas that we’re in are supply-constrained. So, it’s not like you’re competing with a ton of new supply. But there is new supply coming in the market. So, you want your stuff to look great. We’re fortunate in that we have sort of a niche with these very small boutique buildings. I’m talking six units here, 12 units there. And almost all of our portfolio is either recently renovated or recently constructed.
So they attract a very specific kind of tenant who typically wouldn’t love the idea of living in more of a generic, 100- or 200-unit building. And they’re kind of looking for a specific kind of boutique experience. And our job is to market, in every way that we can, that this experience exists, and then actually to provide it once they sign a lease.
Megan Eales Monroe:
Yeah. That’s really interesting. Okay. So shifting gears a little bit. We saw rising insurance costs as a threat that increased. What’s your take on this? And the same question here: What can help offset that?
Moses Kagan:
Well, it’s impacting us just like everyone else. And we are not quite big enough in terms of the stuff that we own to make doing a captive makes sense. That’s for large owners with a unified capital base. The classic example would be if they own a bunch of buildings; It can make sense for them to just effectively act as their own insurance company.
We are not big enough for that to make sense, although we’ve investigated it. We’re still buying policies on a building-by-building basis. We don’t have a captive and we are not buying across the whole portfolio. We are buying on a building-by-building basis.
What we are having to do is make physical changes to the buildings, in order to try to get a handle on the premiums. So, as I said before, most of our buildings are either new or gut-renovated. We are, for the most part, not dealing with things like old electrical panels. That’s like a disaster right now. If you have those old 90s panels, or even earlier, you just can’t get insurance. So we fortunately have been spared that. But I’ll give you an example. For buildings of our size in Los Angeles there is one carrier who I won’t name. Their pricing is actually somewhat reasonable, relative to the rest of the market. But for some reason, which no one has been able to explain to me, they really hate gravel.
But the payback period in terms of the discount that you can get on the premium once you remove the gravel, it’s a less-than-one-year payback period. In other words, even though it costs thousands and thousands of dollars to get the gravel out, you get the money back on the decreased premiums in just one year. So, that’s the kind of thing that we’re doing. We’re just on every property like, “Okay. Why is this quote coming in so high? And is there anything that we can do physically to improve things?”
Megan Eales Monroe:
Yeah. And in those units where maybe there’s not much you can do — those costs are just gonna stay high — is it really about finding other ways to offset that cost?
Moses Kagan:
At the end of the day, for better or worse, in the property management and real estate business, we are price takers as opposed to price makers. Which is to say that you can influence things on the margin, but fundamentally, the rents that we can charge are a product of the supply of apartments in the market and the demand for apartments in the market. And again, things move around and people buy and all that kind of stuff. But, if there were ways that we could raise revenue, we would already have been doing it. You know what I mean? If there were ways to reduce costs, we would be doing that, too. So, I would say that we, and our insurance broker, are spending much more time on trying to find other carriers, trying to do the stuff that I described to change. So, there’s a bunch of work going into it. But fundamentally, things are gonna be worse for a while.
Megan Eales Monroe:
Yeah. That’s a really helpful perspective. And when you said everyone’s in the business of reducing costs, Moses, I have a feeling you might be ahead of the game here. We asked about opportunities to improve efficiency, and the number one that everyone picked was reducing costs. So I think people see a lot of areas for improvement there.
Moses Kagan:
I think that we are a little bit unusual in that we outsource all of our maintenance and we don’t charge a markup on it. So, there’s no distinction between our own buildings and the third-party buildings that we manage. We’re effectively always pushing on pricing. We’re always trying to use our volume to drive down vendor costs. Like, there’s not an incentive misalignment where I’m trying to make money on maintenance. And so I don’t really have any more levers that I can pull in that regard. I’m already driving the prices down as much as I can. Are we bidding stuff, particularly big ticket stuff, maybe a little bit more aggressively than we would’ve otherwise? Yes. But there’s not a lot of fat, I would say, in our operation. If you look at the operating margins, I think that’s borne out. It’s just that we run these buildings pretty leanly.
Megan Eales Monroe:
So I guess a question for you that maybe our listeners could benefit from is where do you commonly see some opportunities to reduce cost in operations that don’t negatively affect the resident experience?
Moses Kagan:
You know, it’s hard to say. I have generally taken the view that you’re better off trying to push rents by improving marketing and leasing, rather than trying to squeeze every last dollar out of costs. We have all these vendors that we’ve been working with for a long time, right? Our landscaper has been landscaping at least part of our portfolio since ‘07 or ‘08. And on and on down the list. Our HVAC guy, and the guy who does our blinds…you name it. So, can I squeeze those guys on an individual project? Yes, I can do one project. You know what I mean? But they’re gonna be tempted to try to make it up on the next one. So, I’m just, I’m a little skeptical. Everything deserves a second look. And sometimes a third look. But I am skeptical. And, of course owners are always looking at this and understandably want to keep a lid on costs. But I’m skeptical that there’s, for at least for a company of our size and managing the size buildings that we’re managing, just not a lot of fat there. You’re better off trying to push the rents up.
Megan Eales Monroe:
Yeah. It sounds like a case of short-term gain, long-term pain.
Moses Kagan:
Yeah. Look, what are you gonna do? You’re gonna not hydrojet the building? You’re gonna just pay for that in the form of leaks? What do you do? You’re gonna not clear the gutters this year? We’ve been doing this long enough that it just goes back to this distinction between being an operator on the one hand and multifamily theater on the other. Can you squeeze op-ex in any one year if you have to, to try to jack up NOI? Yes, you can. But you’re gonna pay for it, and quickly. And sometimes you’re gonna pay a lot of multiples, you know? Yeah. Don’t clean the gutters. Like, okay. Now you have apartment leaks and mold and you’re remediating and all that stuff. I don’t mean to say that I’m not conscious of costs; I’m pessimistic that that’s the way that everyone’s gonna get outta trouble here.
Megan Eales Monroe:
I think that’s a really helpful counter-perspective to what can be the default assumption. Going back to the report, we asked about opportunities to cut costs, and one thing that cropped up was bringing maintenance in house. I know you have a different perspective on this. We talked about mixed incentives. Can you share a little bit about why that’s not the best fit for your business model?
Moses Kagan:
Yeah. And this is gonna be so context specific. But we manage 140 buildings, so that’s 1100 units. Right away, you can see we’re managing very small buildings. We’re not gonna have onsite maintenance techs. It just doesn’t make sense in an eight-unit building. So, by definition, you’re gonna be running a maintenance team that is gonna be spending their time driving around. You’re basically running like a small home services business, right? Instead, we have a group of longtime vendors. These are family companies. One of them is a woman we actually put in business, and her father-in-law and her husband, and they have a few employees.
Another is this guy, and he employs his brother and, I think, one or two cousins. And then of course, some other people, too. And they’ve worked for us for a long time, we’re their biggest customers. So we have a reasonable amount of leverage in terms of pricing and everything. But fundamentally, all those problems that I described earlier are on them, because it’s their brother and their cousin and their father. Those problems are having to be solved by the person who’s closest to the problem and the best position to operate. Well, that’s not me. So are those guys making some margin? Yes. But it’s not free money. They’re performing some really serious labor and I’m happy for them to do it.
Megan Eales Monroe:
Yeah. Well, I thought it was interesting, too: You talked about how you never want there to be any question, if you’re selling these services back to owners, about mixed incentives. Can you speak to that a little more?
Moses Kagan:
Yeah. This is something that just has always struck me as sort of crazy in the property management business. As we’ve already talked about, I raised money from investors, right? And that’s good business. I mean, it’s not a good business right now. But historically, it’s been a good business. And what matters in that business is retaining investor trust. They’re giving you their money to buy a building, and you get to own part of that building, even though you didn’t really put up much of the money. That’s a great business to be in. And the reason that I get to be in that business is because those people trust me. So it’s not worth it to me to ever put myself in a position where they’re worried when I say, “Hey. Look, we had to fix the roof for $10,000 this month.” Or where there’s any question that I’m doing that because I’m hoping to make two grand on the margin on the 10.
So, that was the impetus for setting up the company this way because we started out just managing our own stuff. But the same logic applies with third-party management clients as well. They’re trusting us with these huge buildings. With these huge assets, they’re valuable things and they’re trusting us to run them. And I value those long relationships. We manage people. You know, we’ve been managing for a decade plus for a lot of these owners, and I am hopeful that my kids are managing these buildings for their kids. You know what I mean? We’re trying to build a long, durable business here. And so I just never wanted to be in the position where they’re questioning when we call up and say, “we gotta do something,” where they’re questioning my motivations. Which is not worth it.
Megan Eales Monroe:
Yeah. And that’s really interesting. I’ve heard from so many different management companies with different models where in-house maintenance is a great value-add for them, especially for those who own the properties. But your story makes so much sense. And I think it’s a good point for companies who are thinking about bringing maintenance in-house for the first time to at least think through.
Moses Kagan:
Yeah, I think that’s right. I think there’s a significant advantage that I don’t have, but I know some people who own all their buildings 100 percent with the same group of capital partners or themselves. They do all the management in house. They do all of the repairs and everything in house. And that’s wonderful because there’s no incentive to misalign at all. It’s the same dollars from the same pockets, and you just do whatever makes sense. There’s a lot of power in that alignment. That’s just not the business we’re in. So, given that we are not in that business and that we are in the business of using investor money and managing for third-party owners, I’m trying to reduce the incentive misalignment to the extent that I can.
Megan Eales Monroe:
Yeah. You’re watching out for your investors. So, from the survey, another thing that folks were curious about with cutting costs was negotiating better rates with vendors. It sounds a little bit like what you were describing about the relationships that you have in place. 50% of respondents on the survey said that this was a top priority, so higher than bringing maintenance in house.
Moses Kagan:
Yeah. As construction slows, which I think is the case in L.A., and I think in other markets as well…I do think that there probably are opportunities to go back and say, “Hey. Look, that thing where the price has crept up over the last couple of years? Maybe we can talk about lowering that.” The fact that construction activity has gone down, maybe the vendors are willing to cut you a deal where they wouldn’t have before. But on the other hand, they’re having labor problems right now, and I expect that those labor problems will increase. So I’m not expecting a massive break on repair costs.
Megan Eales Monroe:
What are some things to keep in mind about keeping those relationships positive and mutually beneficial for you and the vendor?
Moses Kagan:
One of the things that I’ve taken great pride in is that we have a whole constellation of companies that have grown with us. You know, the maintenance companies, the HVAC, the landscape, you name it, on and on and on. And so, first of all, it just feels good to see these people. We literally, we put in business, there were ones where we were like, we were like, “You need to create an entity and you need insurance, so let us help you create the entity. Let us introduce you to an insurance broker to get the right coverage.” We really help these people get professionalized in what they are doing. “Here’s how you need to send us an invoice.” So I’m proud of that.
But we get some significant benefits, too. And those benefits are when push comes to shove, if there’s an emergency, they’re there for us when we need. If I really need a break on price on one particular job, for whatever reason I can get it, they’ll play ball. If I need them to be creative about how we do something, rather than just sort of treat me like I’m someone who just came in off the street, they’re willing to sit there and be like, “Okay. Well, what if we thought about it this way? And what if we did that?” And over the course of a long business career, those moments kind of add up.
Megan Eales Monroe:
Yeah. Wow. Sounds like you built a lot of loyalty. So one thing we saw in the report is that the percentage of management businesses using AI has increased. Can you tell me a little bit about whether you’re using AI in your operations, and what does that look like?
Moses Kagan:
Yeah, I’m very bullish on this trend, as you know. Just to give a little bit more context before we talk about us specifically, as everyone presumably who’s listening to this knows, management is incredibly labor intensive. I think labor takes up a good two-thirds, or maybe even more, of our operating expenses at the management company level every month.
The whole business is really about “what is your management fee per unit per month?” That’s on the revenue side. And how many units can each manager manage, and how much does each manager cost?
There’s a lot more to the business, but that’s it. That’s the driver, right? That’s the context. So then what is AI? AI is basically a way to allow each manager to manage more units. And there are some things about the business that are irreducible. Like, someone does sometimes have to go physically open a door. Someone does physically have to go do a unit inspection. That kind of stuff. But for a lot of other stuff that we do — from reminding tenants that rent’s due, to handling roommate swaps, and on and on and on — is basically like desk work.
That for sure will be automated, to a very great extent, by AI now. I’m watching it closely because obviously it has a major impact on the profitability of our business at the management company level. I think in real life, probably the number of units per manager will creep up over time. In other words, I am not expecting someone to say, “Here you go. Here’s your AI property manager,” and you could just hand them 200 units. I think it’s more gonna be like, “Hey. Actually, your people can handle more units than they used to be able to handle.”
Megan Eales Monroe:
Yeah. It’s happening fast. I guess one last quick question on AI. The data showed that larger management companies, like those with a few thousand units, are adopting AI more this year than some of the smaller companies. Do you have any words of encouragement to help those smaller companies catch up and start using it?
Moses Kagan:
When you look at the reality of running a small property management business, it’s not that lucrative and it’s extremely stressful. It’s not like there’s like an IT department or a change management department that you can task with doing a bunch of research. So these small companies are a little slower to adopt it because there’s just not anyone who’s got time internally to do it. With a larger company, there’s more margin there. Therefore, it’s easier to justify hiring someone to focus on this. But we’re definitely right at 1100 units. We’re sort of at that inflection point where we maybe have some money to spend on it but nowhere near as much as some larger companies do. We’re just making it a priority.
Megan Eales Monroe:
Yeah. One last topic to cover. So we asked in our survey about property management professionals’ experience with fraud. Both payments fraud, as well as data security issues. I was expecting it to be higher, but it seems like this jumped up in terms of how concerning people are finding this. 79 percent said they had an experience with payment fraud over the last 12 months. So, I’d love to hear if this affected you.
Moses Kagan:
Oh. I mean, do you want me to start crying on your podcast? Yeah, a few months ago we got hit with a wave of basically fraudulent move-ins. For a really long time, since we’ve been in the business, we have accepted cashier’s checks for move-ins. And we always had a policy where, because there are frequently renters who need a place at the last minute — like for whatever reason, they just moved to town or their other place fell through — we were like, “Look. If someone comes, and the application’s good, and they come with a cashier’s check, we’ll take the cashier’s check, give him the keys.” And I don’t think in 12 years of doing that…that was never a problem. And then about three or four months ago, we got hit with a run. I think what happened is we let one fraudster in. I think she told some other people, and it was like four people all moved in with fraudulent cashier’s checks, which were subsequently dishonored by the issuing bank. Basically, the bank was like, “These are not real cashier checks.” And we looked back and it was like, “Oh. Actually, it looks like maybe these IDs had been photoshopped or something.” I mean, this was our first experience with actual criminals. We’ve had people during the years who couldn’t pay their rent for various reasons. Some of them are more legit, some of them less legit. But this was a different experience. They were real criminals.
Megan Eales Monroe:
Well, I’m sorry that happened. Sounds like a tough situation to deal with. But coming out of that, were there any takeaways? Or I think you mentioned some changes to your policies that happened because of that. Anything that you were able to learn?
Moses Kagan:
Yeah, We basically want wires to move in now for the first month and security deposit. And you know, I don’t think that will probably be feasible in a lot of people’s markets who are listening. But in L.A., it is feasible. And what you’re doing when you require a wire from a bank, and you are diligent about matching up the name on the account from which the wire originates with the names on the lease, is basically leveraging the banks’ “know your customer” policies and procedures and technology. So if you want to open a bank account, the bank is probably going to do a pretty good job of checking your ID. So if you then require the move-in funds to be wired from a bank account with that name, and the name matches the name on the lease, you’re sort of piggybacking on the work that the bank does to verify the identification of the person who’s creating the account and hopefully leasing your apartment.
Megan Eales Monroe:
And what about screening? You mentioned that you were using the automated ID verification. Any other measures on the screening front?
Moses Kagan:
Well, yeah. I mean, we’ve done more checking of employment and of the previous housing situation than we did before. But how much does it cost to put up a fake website? “Oh, I work at whatever.” How easy is it to falsify a paycheck? It’s just all this stuff that is so vulnerable to being spoofed or whatever. It’s really challenging. Like, you called up the guy who claims it’s his boss, and how do you know? And obviously it’s different if they work at Apple or something; It’s a different story. But a lot of our clients, a lot of our tenants, are freelance. They work at a small company. They’re Instagram influencers. They’re whatever. You know what I mean? There is a limit to the amount of benefit that you get from doing something more traditional, like calling people and asking questions.
Megan Eales Monroe:
Yeah. That’s challenging. But it sounds like you’ve got some good learnings from what you’ve experienced so far. And hopefully it doesn’t happen again.
Moses Kagan:
Yeah. I mean, as you probably know from talking to a lot of property managers, this business is a bad news business. The expectation is that everything’s going to go well and then it doesn’t. And it’s some new problem. But you know what? That’s business and that’s life. And you’re being paid by the owner to be the one with whom the buck stops. Like, that’s it, “This is the problem. We gotta solve it.” And we’ll solve that one, and another problem will pop up. That’s just the nature of business and life.
Megan Eales Monroe:
I love how you brought that full circle. Because I think you said that right at the top of the interview, you’re where the buck stops.
Moses Kagan:
That’s how I think about it. Yeah.
Megan Eales Monroe:
So we are at the end of our time. Is there anything else that you wanted to talk about or bring up that I didn’t ask?
Moses Kagan:
No, I just, I want to tell people I am very active on X, formerly Twitter. You can find me @MosesKagan. And also I have a mailing list at moseskagan.com. I write an X every day about the business of buying and renovating and managing apartment buildings, with some related topics as well. But the newsletters, they’re really about the nuts and bolts of the business. The most recent one I sent was about why we don’t have cancellation fees in our property management agreements and going through my thought process for why we made that decision. So that’s so for the real estate nerds out there. I invite you to sign up.
Megan Eales Monroe:
Awesome. Well, we can put a link to that in the show notes.
Moses Kagan:
Thank you.
Megan Eales Monroe:
Thank you so much, Moses. It was great to hear your perspective and how you are adapting and learning at Adaptive Realty. I guess it’s in your name.
Moses Kagan:
That’s right. And, Megan, thank you so much for having me and to AppFolio for being, like I said, a great partner to us in a bunch of different ways, for a long time.
Megan Eales Monroe:
Yeah. Happy to have you. Thanks Moses. Have a good day.
Moses Kagan:
Take care.
Megan Eales Monroe:
Today’s conversation with Moses highlighted what’s on the industry’s mind in 2025, but there are still so many insights to explore in the full 2025 Property Manager Benchmark Report. Download it now at appfolio.com/benchmark to learn more about how the real estate industry is adapting to a changing landscape, and discover actionable steps to position your business for success.
And thank you once again to Moses Kagan for joining us today. To hear more from Moses, be sure to follow him on X or visit his personal blog at moseskagan.com.
Thank you for joining us on this episode of The Top Floor, brought to you by AppFolio. If you enjoyed the conversation, let us know by leaving a review wherever you listen to this podcast — we’d love to hear your feedback. Also, make sure you’re subscribed to The Top Floor podcast to get notified as soon as our next episode goes live. Until then, we’ll continue the conversation around all things real estate and association management on the Industry Insights section of our website: appfolio.com/industry-insights. We’ll see you there.
