Housing
Centralizing Multifamily Operations in 2026: Why Pet Management Is the Missing Layer
Centralization has become the dominant operational strategy in multifamily, and the 2026 data confirms the industry has stopped debating it. MRI Software’s Multifamily Pulse Check 2026, based on more than 700 responses from real estate professionals across North America, found that 87% of respondents plan to increase centralization over the next 12 months. The primary drivers are improved efficiency (38%), better resident experiences (32%), and cost savings (27%).
What the data does not surface is which operational functions are being centralized and which ones are still handled manually at the property level. For most multifamily portfolios, pet management falls in the second category. It is one of the highest-friction, highest-frequency operational areas a leasing team touches daily, and it is almost never part of a centralization conversation until the problems it creates become too large to ignore.
The Centralization Push Is Nearly Universal
Centralization is gaining traction across portfolios of all sizes, and 63% of operators plan to expand centralized operations within the next five years. The approach is not perceived as an industry disruptor, with only 11% of survey respondents rating it as a highly significant challenge. The friction is not in the decision to centralize. It is in figuring out what to centralize first and what gets left behind as a result.
Leasing, accounting, maintenance, and resident communication are the natural first movers because they already live inside existing property management systems. There is infrastructure to build on. Pet management does not have that infrastructure in most portfolios. Pet records live in spreadsheets, email threads, and physical files at the property level. ESA documentation is reviewed by whoever handles the application that day. Incident tracking, if it exists at all, is informal. None of that is centralizable without first building the data layer underneath it.
What Operators Are Centralizing and What They Are Not
The functions moving to centralized hubs are those with established digital workflows. The functions that remain at the property level have never been digitized. Pet management sits almost entirely in the second group.
Where Pet Management Stands in Most Multifamily Portfolios Today
The following functions can help better understand the pet management layer, especially how it can help generate revenue in the long run.
| Function | Typically Centralized | Pet Management Reality |
|---|---|---|
| Leasing and applications | Yes, in most mid-to-large portfolios | Pet addendums handled locally, no portfolio-wide standard |
| Accounting and payments | Yes | Pet fees tracked inconsistently, ESA waivers rarely logged |
| Maintenance requests | Increasingly centralized | Pet-related damage claims handled ad hoc |
| Resident communication | Moving to centralized hubs | Pet policy questions are answered differently by different staff |
| ESA documentation review | Rarely | Site-level decision, no cross-property visibility |
| Pet registration and records | Almost never | Paper-based or email-based, not retrievable at scale |
The practical result is that the same company runs multiple pet policies enforced multiple ways, with no shared record of which animals are on which properties, no consistent ESA documentation standard, and no portfolio-level visibility into pet-related revenue, incidents, or compliance exposure.
Why Pet Management Creates a Specific Problem at Portfolio Scale
The gap between what executives see and what property managers see is a recurring theme in the MRI data. Confidence in fraud detection strategies is mixed, with 51% of property managers expressing confidence compared to 28% of executives. Executives have portfolio visibility that reveals patterns site-level staff cannot see. The same dynamic applies to pet management.
A leasing manager at a single property who has handled pet registrations informally for two years believes the system is working. An asset manager looking across 20 properties sees something different: no standardized records, no consistent fee collection, and no documented ESA review process that would survive a fair housing audit.
That gap between local confidence and portfolio-level exposure is exactly what centralization is designed to close, and pet management is one of the clearest examples of a function in which local confidence is masking a real portfolio risk.
The Resident Experience Argument Cuts Both Ways
Eighty-five percent of respondents expressed concerns that centralization would lead to a loss of personal touch with residents, and 80% are concerned about staff resistance. Notably, executives are far more concerned about these risks than property managers: 96% of executives worry about loss of the personal touch, compared with 71% of property managers.
For pet-owning residents, the personal-touch argument favors centralization, not against it. The experience of registering a pet varies depending on which leasing agent is at the desk, their mood, and whether they remember the policy correctly. That is not a personal touch. That is an inconsistency. Residents who go through a clear, standardized pet registration process and receive consistent communication about what is required and what they get in return have a better experience than residents whose onboarding depends on whoever happens to handle their application.
A pet-oriented property that includes amenities and partnerships with local pet services gives residents a sense of identity and belonging. These initiatives are not superficial marketing. When done correctly, branding becomes a competitive moat. When done poorly, it becomes an expense that yields no returns. The branding only holds when the operational layer beneath it is consistent enough to deliver on its promise. A property that markets itself as pet-inclusive but runs pet registration informally at the property level is building a brand promise it cannot reliably keep.
Pet Revenue Is Not Being Managed Like a Revenue Line
In a market where rent growth is measured in fractions of a percent, ancillary income matters more than it did three years ago. National apartment asking rent growth was just 0.9% year-over-year in Q2 2025, according to CoStar. In this environment, the focus is shifting from rent growth to operational efficiency, occupancy retention, and ancillary income as the primary levers for improving NOI.
Pet fees, deposits, and monthly pet rent are ancillary income. In a portfolio where 40% of units have pets, and the fee structure is competitive and consistently enforced, that revenue is material and predictable. When that same portfolio has inconsistent enforcement, widespread ESA approvals without documentation review, and no tracking of which units are generating pet revenue versus which have converted to ESA terms, the gap between potential and actual pet revenue is a number most operators have never calculated. That calculation is what centralization makes visible.
What Centralized Pet Management Recovers
- Pet fees waived without documentation review, now captured with a consistent ESA standard
- Monthly pet rent is inconsistently collected across properties, and is now enforced uniformly
- Damage costs unattributed to specific animals are now traceable through a centralized incident record
- Portfolio-level pet revenue that has never been reported, now visible in a single dashboard
Where AI Fits and Why It Requires Centralized Data First
AI awareness and aptitude are strong, with 93% of respondents using AI in some capacity. Integration with existing systems is viewed as the biggest barrier to AI adoption, with executives showing more concern about the ROI of AI tools than property managers.
The integration barrier is real for pet management specifically. AI tools improve outcomes when the underlying data is clean, standardized, and centralized. Properties that attempt to apply AI to pet operations before the records are standardized end up automating inconsistencies rather than eliminating them.
The sequence matters: standardize the data first, then apply automation on top of it. A portfolio with no consistent pet registration format, no structured ESA documentation log, and no centralized incident record cannot extract meaningful AI-driven insights from the data because the data does not exist in a usable form.
Leasing has become the clearest first target for AI because it sits directly at the intersection of revenue, repetitive work, and resident experience. Pet registration and ESA processing sit at the same intersection. Both are high-frequency leasing tasks. Both involve repetitive documentation handling. Both directly affect resident experience and revenue. They are not being targeted first because most portfolios have not yet built the structured pet data layer needed for AI to be useful there.
Conclusion
The centralization momentum in multifamily is settled. The question for 2026 is not whether to centralize but which operational functions get included in the strategy and which ones get left behind. Pet management is the layer that most portfolios have not yet brought into their centralization work, and the cost of that gap shows up in inconsistent enforcement, undocumented ESA decisions, unreported pet revenue, and a resident experience that varies by property rather than reflecting consistent standards across the portfolio.
Success will depend on execution, and efficiency cannot come at the expense of trust, whether from residents, staff, or the systems designed to protect them. Pet management centralization, done correctly, delivers both.
Frequently Asked Questions
What percentage of multifamily operators plan to increase centralization in 2026?
87%, according to MRI Software's 2026 Multifamily Pulse Check, with improved efficiency, better resident experiences, and cost savings as the top drivers.
Why is pet management typically excluded from centralization efforts?
Pet records are rarely built into core PMS platforms and have historically been managed informally at the property level, leaving no standardized data structure to centralize from.
How does decentralized pet management affect NOI?
Inconsistent enforcement leads to unenforced pet fees, unsystematic ESA approvals that waive revenue, and untracked damage costs. In a low-rent-growth environment, those are direct NOI leaks.
Does centralizing pet management hurt the resident experience?
For pet-owning residents, the opposite is true. A consistent, transparent registration process and clear policy communication are preferable to one that varies depending on which staff member handles the application.
What needs to happen before AI can be applied to pet management operations?
Pet records need to be standardized and centralized first. AI tools require clean, structured data to produce useful outputs. Automating inconsistent manual processes produces inconsistent automated results.
What is the biggest portfolio-level risk from informal pet management?
Inconsistent ESA documentation review creates fair housing exposure that is invisible at the property level but significant across a portfolio. Without a centralized review log, operators cannot demonstrate consistent application of their accommodation standard.
