Trends, ideas, and considered opinions from multifamily developers and market experts at Marcus & Millichap’s “Multifamily Forum,” held earlier this year in Chicago:
> Bigger units are selling like crazy. “The supply of condos out there is high end and much larger in size,” said Tom Weeks, Executive General Manager for Development, Lendlease. Ditto for rentals, said James Letchinger, President, JDL Development. “We’re seeing a new wave of renters with empty nesters wanting to move downtown,” he said. His firm experienced “unbelievable leaseup” for the larger units in one of its downtown buildings.
> The workforce shortage is killing business. “There just aren’t enough subs to get the work done,” said Letchinger. “There’s a huge workforce out there that’s just not being tapped. We need to get people into the unions, and we need the big contractors to help more minorities to become owners of their subtrade firms.”
> Keyless entry is going to be the new norm in multifamily. Alex Samoylovich, CEO, Cedar Street, said he’s working toward keyless entry via tenants’ cellphones across his firm’s portfolio of 18 properties. “Seventy-five percent of our tenants have given us permission for keyless entry into their units to deliver packages,” he said. Keyless technology can even be a revenue stream, he said. “We did $85,000 last year in lockouts.”
> Parking is going away in crowded urban markets. “Our ratio now is 0.4 spaces/unit, and zero parking in TODs,” said Sar Peruri, Principal, Oxford Capital Group, developer of the 429-luxury-unit Essex on the Park, Chicago. Derek Lopez, Managing Director, GEM Realty Capital, said his firm is looking into how to repurpose its parking decks down the road. But panelists agreed that resident parking is still essential in second-tier cities and the suburbs.
> Figuring out what Millennials want remains a puzzlement. “They’re now 35, not 25, and they’re forming families,” so their housing demands are changing, said Jim Driscoll, SVP of Development, Waypoint Residential. But John S. Sebree, Marcus & Millichap’s National Director of Multifamily, said, “Tenants in B and C apartments”—many of whom presumably are Millennials—“will usually start buying homes, but that’s just not happening.”
> The amenities war is “out of control,” said Alan George, Chief Investment Officer, Equity Residential. “We’re building small, usable conference rooms, with really good WiFi,” he said. “That’s really important.” But he questioned whether building, say, a full indoor basketball court is justifiable. Choosing the right mix of amenities for each project is critical.
> Rightsizing amenities remains an art form. Lindsey Senn, VP at Chicago developer Fifield, said that at the firm’s 390-unit Sinclair luxury tower, “We built the biggest fitness center we’ve ever done, and the residents said they wanted even more.”
> Teamwork is more important than ever. “With construction costs going up, the teamwork with the developer, the contractor, the architect, and the interior designer has to be even more intense,” said Jack Boarman, Partner, BKV Group. “We need to find new ways of manufacturing, like modular baths, and subtrade innovation that can save time and money.”
Related Stories
Multifamily Housing | May 17, 2017
Swedish Tower’s 15th floor is reserved for a panoramic garden
C.F. Møller’s design was selected as the winner of a competition organized by Riksbyggen in Västerås.
Mixed-Use | May 17, 2017
The Lincoln Common development has begun construction in Chicago’s Lincoln Park
The mixed-use project will provide new apartments, condos, a senior living facility, and retail space.
High-rise Construction | May 15, 2017
Construction begins on 47-story luxury tower in Chicago’s South Loop
The glass tower is being built at 1326 S. Michigan Avenue.
Multifamily Housing | May 10, 2017
May 2017 National Apartment Report
Median one-bedroom rent rose to $1,012 in April, the highest it has been since January.
Multifamily Housing | May 10, 2017
Triple Treat: Developer transforms mid-rise into unique live-work lofts
Novus Residences’ revolutionary e-lofts concept offers tenants a tempting trio of options—‘live,’ ‘live-work,’ or ‘work’—all on the same floor.
Multifamily Housing | May 3, 2017
Silicon Valley’s high-tech oasis
An award-winning rental complex takes its design cues from its historic location in Silicon Valley.
Multifamily Housing | May 2, 2017
Multifamily housing: 7 exciting, inspiring innovations [AIA Course]
This AIA CES course features seven novel approaches developers and Building Teams are taking to respond to competitive pressures and build more quickly and with more attractive offerings.
Multifamily Housing | Apr 26, 2017
Multifamily amenity trends: The latest in package delivery centers
Package delivery centers provide order and security for the mountains of parcels piling up at apartment and condominium communities.
Multifamily Housing | Apr 26, 2017
Huh? A subway car on the roof?
Chicago’s newest multifamily development features an iconic CTA car on its amenity deck.
Multifamily Housing | Apr 18, 2017
Three multifamily, three specialized housing projects among 14 recipients of the AIA’s 2017 Housing Awards
2017 marks the 17th year the AIA has rewarded projects and architects with the Housing Awards.