Shrinking Apartment + Blowout Amenities = Big Dividends

Case Study 5.2

Shrinking Apartment + Blowout Amenities

= Big Dividends

“In order to align rental rates with affordability, the average unit size for apartments continues to shrink, this coupled with the large unmet demand in the urban market, makes the micro-apartments very attractive for first time renters.�

Shrinking Apartment + Blowout Amenities

= Big Dividends

The demographics of urbanization is recognizing a shift in the selection pattern

647 sf

Small One Bedroom

of households for the millenials and aging baby boomers, both of whom are choosing urban lifestyles for their households. With the migration of households moving to large employment centers in urban America, there is an increased demand for high density housing products in upscale mixed-use neighborhoods.

As a result, expensive land costs and higher construction costs have placed upward pressure on multi-family rental rates in these upscale urban areas.

In order to align rental rates with affordability, the average unit size for apartments continues to shrink, this coupled with the large unmet demand in the urban market, makes the micro-apartments very attractive for first time renters.

Ultra efficient studios of 375 sf will be able to rent for $900 to $950 per month in highly desirable urban locations like Denver, Houston, or Atlanta. Design of the studio apartments utilizes every square inch of space, much like the design of cruise ship state rooms. Kitchen areas become very compact but are nicely appointed with stone counter tops, zero profile two burner ceramic cook tops, undercounter glass front refrigerators, microwave ovens, built-in oval desk tops and small stainless steel sinks. Closets are designed as built in wardrobes with five high dresser drawer units and baths feature frameless glass showers where natural light is borrowed from a window to the studio space. Studios are given the same treatment as larger units with ten foot ceilings, bamboo floors and balconies to expand the sense of space.

01 Dog parks that are secure and well lit.

02 Dog grooming station with wash and blow dry facilities.

Along with the smaller apartment sizes, we are seeing an incredibly creative array of project amenities emerge into the development mix to compensate for the smaller apartment units.

Developers are finding that there are two payoffs for blowout amenity packages. First, the leasing team insists a project with robust amenities has an accelerated lease up period. Secondly, upon stabilization of the project, developers are seeing a premium for the sale of properties with superior amenity packages. Each geographic region

03 Sunset roof terrace with Wi-Fi lounge.

has unique amenity features pertinent to their market, however, there is a growing trend to out do your competitors with each new project. Demographic trends are identified within the Millennium crowd and there are a few “must have“ amenities which should not be overlooked.

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02

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First, most urban apartment renters have lots of dogs, and in most projects over 50% of the renters have dogs! With this in mind, we are including dog grooming stations with wash area and blow dry facilities.

Secondly, as we see renters attracted to more walkable urban developments, bikers have become the focus of amenities in our urban projects. Bike rental, storage, repair and wash down facilities are imperative.

Studio

364 sf Junior One Bedroom

572 sf

Studio & Junior One Bedroom Apartment 01 Window in bathroom harvests daylight from apartment bedroom 02 Glass top, zero profile two-burner stove top 03 Stainless steel mini sink in kitchen 04 Wardrobe closet (Studio) 05 Walk-in closet (One Bedroom)

572 sf • Junior One Bedroom

06 Sunset roof terrace with Wi-Fi lounge.

07 Stone countertops in kitchen and bathoom 08 Spacious balcony 09 Bamboo wood floors 10 Frameless glass shower 11 Stacked washer and dryer 12 Built in oval table top

364 sf • Studio

A third target for amenities is the creation of gathering spaces in the early morning and evening.

In the morning, early bird residents want a place to hang out, grab a cup of coffee and catch up on their e-mail. A comfortable but cozy Morning Room that offers gourmet

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04 Bike wash-down area with maintenance shop and bike racks.

05 Morning room with gourmet coffee and tea service.

coffee and tea service meets this need. In the evening, a gathering place to enjoy the sunset and socialize with other residents has become a big hit. Getting above the tree line is essential, so locating a Sunset Roof Terrace with a Cyber Lounge at the Penthouse level becomes a real perk for residents. Todays “must have“ amenity list will make a difference and bring premium value to your project in the form

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of quicker lease-ups and higher resale values. Go for it!

“Demographic trends are identified within the millennium crowd and there are a few “must have“ amenities which should not be overlooked.”

ABOUT the AUTHOR Founding Principal, Scott Ziegler, AIA, is a recognized authority and thought leader in the multi-family industry, as well as a frequent guest speaker. Mr. Ziegler’s visionary leadership, insight and comprehensive knowledge of the profession have led his firm to design over 70 award winning projects that have garnered regional and national recognition. Multi-family Executive Design Awards recognized Ziegler Cooper’s design of The Austonian as a Grand Award Winner for Project of the Year (High-Rise: Condos) and as a Merit Award Winner for Project of the Year (Green). Multi-Housing News Design Excellence Awards program recognized The Austonian for Best New Development, High-Rise. With over 30 years of experience, Ziegler is adept in providing design direction to his clients in the form of density studies, developing appropriate unit mix, unit design, lifestyle demographics, amenity packages, interior design and insight into future design trends.

Contact Scott: sziegler@zieglercooper.com. 713.374-0008

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Ziegler Cooper Architects 600 Travis Street Suite 1200 Houston, Texas 77002 (p) 713.374.0000 (f) 713.374.0001 www.zieglercooper.com