This article was supported by RTC’s Research Analyst Joseph Chiang. If you are a college junior or senior with IB/PE experience interested in supporting RTC’s research, check out the internship description.
State of Play
Last week, the big buzz inside the serial acquirer community was Dwelly, a UK-based platform rolling up property management companies with AI transformation as its core thesis. So why the excitement?
Dwelly recently raised $93 million, led by General Catalyst and Trinity Capital. With 10+ acquisitions in less than two years, the company is scaling aggressively.
In the U.S., however, private equity has been consolidating property management for years. So let’s unpack:
How the business model works
Why the sector has attracted PE interest
And what AI might change going forward
First, What Is Third Party Property Management?
Property owners, ranging from individual landlords to large institutional investors, hire property management companies to outsource the day-to-day operations of running a property. Their goals are simple:
Maximize occupancy
Maintain tenant satisfaction
Keep properties physically well-maintained
These services seem like pretty mundane tasks. And they are. So why do these third party service providers exist?
Because an increasing share of U.S. housing is owned by investors rather than owner-occupants.
Source: BatchData
Many real estate investors, including real estate private equity firms, prefer to outsource day-to-day operations so they can focus on capital allocation, acquisitions, and financing.
And property managers price their services as a percentage of monthly rental revenue to make their services a fully variable cost for the investors.
Typical fee structures include:
Fee Type | Typical Range |
Monthly management fee | 8% – 12% of collected rent |
Leasing fee | 50% – 100% of one month’s rent |
Lease renewal fee | $100 – $500 |
Setup / onboarding fee | $100 – $300 |
Maintenance markup | 10% – 20% on vendor costs |
For large multifamily portfolios or institutional owners, fees often compress to 3%–6% of rent due to scale, making it attractive to continue to outsource as their portfolio grows.
For the property managers, this fee-based model creates predictable, recurring revenue streams.
Case Study: Asset Living
Scale and density in a market are the biggest factors in driving margins for property managers. And Asset Living’s story really illustrates the point that private equity is here to consolidate aggressively.
Founding Story (1986-2018)
Asset Living’s origin traces all the way back to 1986, when the U.S. had the worst bank failure crisis driven by speculative real estate lending (eerily reminiscent of 2008 subprime mortgage crisis, no? History really rhymes). The business was initially started to help turn around failing properties by improving operations.
Source: WSJ
Over the following decades, the founders expanded from single-family homes into student housing and multifamily properties, gradually building a diversified management platform.
Trilantic Ownership (2018-2022)
The real transformation came in 2018 when Trilantic (NY-based mid-market PE firm) acquired Asset Living. And they got to work right away:
Value-Added Service Add-Ons
Interestingly, one of the first acquisitions Trilantic decided to embark on wasn’t another property management company but rather a digital marketing company called Poetic. Poetic was a creative marketing agency that helped properties develop property websites, marketing materials, and digital marketing strategies.
The push to modernization was an overarching strategy, as Asset Living also simultaneously rolled out a resident engagement app and standardized amenity services throughout all their managed properties.
Before embarking on consolidation, Trilantic first built out value creation capabilities hinging on modernization and digital transformation.
Consolidation Add-Ons
With the foundational pieces in place, Trilantic went on a consolidation spree:
Alpha Barnes: Added 30,000 units and established dominance in the compliance-heavy affordable housing (LIHTC/Section 8) space.
Shelton Residential: Added 17,000 units, expanding conventional multi-family and build-to-rent (BTR) footprint across the Southwest.
City Gate Property Group: Added 10,000 units, deepening the multi-family portfolio density in Dallas and surrounding Texas markets.
JMG Realty: Added 20,000 units and a new corporate office in Atlanta, jumpstarting expansion into the Southeast.
Echelon Property Group: Added 13,000 units and a Denver corporate office; expanded conventional and value-add multi-family presence in Colorado.
Roark Ownership (2022-Current)
Under the ownership of Roark with a fresh round of capital, Asset Living went on an even larger consolidation spree:
Trinity Multifamily: Continued consolidation of the central and mountain regions to build regional density.
BMC Management: Acquired the 5,000-unit property management arm of BMC Investments, capturing captive real estate developer pipeline.
Strategic Management Partners: Added 25,000 units and 600+ employees in the Southeast, bringing turnaround and receivership capabilities.
First Communities Management: Massive acquisition adding 50,300 units, entrenching Asset Living as the market leader in the Southeast.
FPI Management: Acquired the 6th largest US manager, adding ~165,000 units to reach a combined total of ~450,000 units.
As we will discuss next, there’s still a lot of room for Asset Living to continue its acquisition spree.
Side note: Asset Living CEO Ryan McGrath has had an incredible rise inside the company—going from financial analyst to COO in four years, then President, and ultimately CEO. If anyone knows him, I’d love to learn his story.
Source: LinkedIn
2026 Serial Acquirer Conference
I’m excited to announce the inaugural 2026 Serial Acquirer Conference, taking place on Tuesday, March 31, 2026 in New York City.
This is not a traditional private equity conference. This is a room built for:
Mid-career PE professionals actively exploring ownership
HoldCo founders
Buy-and-build operators
Independent sponsors
With a room-full of investors who back them
If you’re serious about building—or backing—serial acquisition platforms, this is the room you want to be in.
Most conferences just talk about private equity. This one is about becoming an owner.
You can expect:
Tactical insights with real takeaways
Candid discussions around platform building, capital, and scaling
Extended networking over lunch, coffee, and happy hour
Direct access to investors who are actively funding platforms
If you’re thinking about—or actively building—a serial acquisition platform, you should be here.
The Details
📍 @Ease 1345, New York City
📅 Tuesday, March 31, 2026
Road To Carry has always been about building alongside each other, not stopping at just consuming content. Hope to see many of you there!
Investment Thesis
There is a lot to like here, although the industry may be entering a low-growth phase.
1. Large market, with institutional ownership as a tailwind
The U.S. property management industry is extremely large at ~$140 billion.
Source: IBISWorld.
One of the key drivers of the property management industry growth is the growth in community associations (e.g., HOAs who would hire property managers).
Source: Stax
However, growth may be moderating as new housing construction slows.
Source: St. Louis Fed.
2. Fragmented Industry with M&A Arbitrage
There’s still plenty of opportunity for consolidators due to the fragmentation of the market (note: the below data is as of 2023, and given the pace of consolidation (as we saw from Asset Living case study), the market could be more consolidated).
Source: Stax
And for the most part, there is still a long tail of mom and pops who manage only 1-400 units of property.
Source: Rental Housing Journal
And the multiple re-rating from acquiring mom-and-pops yields an attractive ~3x MOIC, making it an attractive thesis for building local/regional consolidators.
Source: BizBuySell, Crowne Atlantic, FinModel Lab.
3. Value creation opportunities
As you can see from illustrative economics below, unit economics of an individual property manager can still be very small–a manager of 400 units would yield ~$250k of EBITDA. This is why there is such a long-tail of property managers.
However, consolidation unlocks operating leverage and ancillary revenue opportunities, including:
Amenity services
Shared Wi-Fi programs
Bulk vendor contracts
Because staffing costs are largely fixed, higher rent flows directly into EBITDA. In below scenario, a 14% rent increase can drive a 36% increase in EBITDA.
Source: ApartmentList, Stessa, Rentec, PropertyMeld, BLS
4. (New) AI as a real margin driver?
Speaking of value creation, AI is now the newest buzzword in property management.
According to PropTech Buzz on Dwelly,
“Dwelly integrates its AI-driven operating system while keeping existing agency brands and teams intact…On average, properties receive around 10 verified offers within three days, reducing tenant placement time to under two weeks. Property management has also been streamlined. AI-powered chat tools and automated tracking systems have cut average maintenance resolution times from roughly 50 days to 20. Co-founder Dan Lifshits has stated that the goal is to reduce administrative work, not replace staff. This allows teams to focus more on client service and property viewings.”
Is this a sustainable value creation lever? Only time will tell.
Learn how PE firms actually do deals—from start to finish.
Road To Carry PE course walks you through the full PE deal process, not just modeling. Bite-sized videos & exercises & 40+ real-life files. For analysts, associates, or anyone interested in learning how PE firms do deals. Past alumni include associates from Carlyle, Apax, Charlesbank, and Gryphon.
Looking Ahead
Private equity’s thesis in property management has largely been proven out. Platforms like Asset Living show how quickly a regional operator can scale through acquisitions and market density.
Despite years of consolidation, the industry remains highly fragmented. Thousands of small operators still manage only a few hundred units, leaving significant room for continued roll-ups—especially in markets outside the U.S., where fragmentation is often even greater. New entrants like Dwelly are already pursuing this strategy.
AI may be the wildcard. Across the public markets, we’re already seeing a shock to software as AI reshapes cost structures and workflows. Property management—long dependent on manual coordination and administrative work—could be one of the first business services sectors to feel that disruption.
The question is: will private equity lead the AI transformation of this industry—or will the next generation of tech-native entrants build the winning platforms?
I’ve seen VC-driven disruption hit PE-dominated industries before. It’s bound to create a lot noise, but only time will tell who wins.
Any topics I should cover next? Share thoughts with [email protected]
Were you forwarded this newsletter? Subscribe here.
Make sure you receive Road To Carry every Thursday and Saturday!
Everyone: reply to this email with a “hi”
Gmail mobile: Click the 3 dots (...) at the top right corner, then "Move," then "Primary"
Gmail desktop: Go back to your inbox and move this email to the "Primary" tab
Other users: Follow these instructions