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Honeywell has acquired Carrier's access control division for $4.95 billion, bringing on 1,200 employees across 33 countries. This acquisition aims to enhance Honeywell's building automation capabilities, especially in access control, which is essential for automated HVAC and lighting systems. As discussed in today's email, this strategic move positions Honeywell to dominate the building systems market, leveraging its extensive global network and potential for further acquisitions.

This week in Propmodo Technology, we explore multifamily management, discussing how apartments are using rewards programs to retain tenants as the rental market softens. We also examine whether smart home technology is making apartment living easier or more complicated, and how multifamily properties can be future-proofed with smart access control.

Now, let's dig in!

Honeywell Bets Big on Building Automation With $5B Carrier Acquisition

Honeywell is probably best known for its popular round thermostats, commonplace in homes since they started mass producing them in the 60s. However, residential thermostats are no longer on their product list; in 2018, they spun off their home products into a company called Resideo Technologies. Now, Honeywell has focused its business on three major trends they see shaping the future: aviation, automation, and the energy transition. These last two trends have driven Honeywell to push aggressively into the commercial buildings sector, culminating in the purchase of Carrier's access control division, a company also known for its contributions to thermal comfort.

The deal will cost Honeywell $4.95 billion and will involve incorporating Carrier’s 1,200 access control employees, who operate in 33 countries worldwide. Honeywell paid a premium for Carrier’s business, with the price tag representing around 13 times the unit’s EBITDA. The company expects the business unit to be “cash-EPS accretive in the first full year of ownership.”

Financials aside, this acquisition allows Honeywell to expand its building automation business line. Access control has become a key component of any building automation system, providing the data necessary for other systems to create automated changes to HVAC and lighting. Vimal Kapur, Honeywell’s Chief Executive Officer, stated, “By leveraging the capabilities of the combined company’s advanced security and safety systems, customers will be able to maximize their performance, efficiency, and cost-effectiveness, creating long-term, sustainable value.”

Even without the new Carrier unit, Honeywell is a $155 billion company with around 100,000 employees in over 80 countries. Now that they have decided to focus on buildings and building systems, they have the potential to become the largest competitor in almost any segment. They also have contacts with dealers and installers worldwide, which remains one of the primary ways buildings adopt new technology. If Honeywell continues its push into building systems, it might not be long before we see them either acquiring other competitors or outcompeting them in the marketplace.

Insider Insights

🛏️ Common problems: One of the pioneers of the co-living concept, Common, has announced that it has filed for Chapter 7 bankruptcy and will have to liquidate all of its assets in order to pay off creditors.

🤖 Me, myself, and AI: Residential brokerage Keller Williams has launched an AI-powered assistant for its real estate agents.

Overheard

Propmodo Technology: Multifamily Management

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