Renters in New York City planning to leave their current apartment could make a quick buck by giving their landlord an early heads up.
A new tech startup called Doorkee is paying tenants an average of $1,000 to do just that. And prominent NYC landlords have taken notice, participating in a $5.7 million round of funding for the company.
"We create a win-win situation by getting the departing tenant involved as early as possible," John Fagan, co-founder and CEO of Doorkee, told Cheddar Tuesday. "We financially incentivize them to give their landlords early notice up to 100 days out."
Fagan says turnover costs stemming from prolonged vacancies and broker's fees can eat into a landlord's profits by up to 20 percent and that Doorkee saves them an average of $5,000 per unit filled through the platform.
"Traditionally, apartment renting has been this zero-sum game between the apartment-seeker and the landlord," Fagan said. "The landlord is trying to save a bunch of money on filling that unit and the apartment-seeker has had to wait until that last minute to find their apartment."
According to real estate news site GlobeSt.com, landlords using Doorkee own more than 40,000 properties throughout New York City.
"You can go to any of the other listing sites, but they're not going to have apartments that are available two or three months out," Fagan said. "Doorkee is the only place you can find your apartment that far out in advance."
Amid the pandemic, Doorkee has seen demand surge from landlords looking to get ahead of vacancy costs.
"Things are changing in the professional real estate sector in that they're having to adjust to lower rents, higher vacancy, and they're gonna want to get in front of that," Fagan said.
Though New York City landlords may be slow to adapt to technology, more than half of the apartments filled through Doorkee were offered virtual tours.
As another perk for tenants, Doorkee is offering up to $5,000 for residents that refer their landlord to the service, depending on the size of the property owner's holdings.
"Everyone wants to find their apartment in advance," Fagan said. "Landlords are finally catching up with where tenants want to be."