Three Things We’re Watching in 2018

Multifamily Renovation Lifespans Shorten

As tastes evolve and today’s renters continue to seek new and different offerings, we see owners and managers of multifamily properties considering partial or complete refreshes of their public spaces sooner than ever. Driven by the desire to increase rents and stay competitive with new apartments coming on the market, updating and expanding a building’s amenity offerings can provide instant ROI.

Previously, a property might maintain its aesthetic with only small repairs and updates for seven to ten years. Now, savvy operators are starting to execute in 4-5 years, and constantly keeping an eye on which amenities get used the most, especially across a portfolio of properties, and are calling on FitzGerald to re-imagine and reinvigorate the less-used spaces. Sellers and brokers are even getting on board, marketing some properties completed as recently as 2015 as value-add opportunities. At the same time, buyers are drawn to acquiring and renovating an existing building for the cost savings and speed of delivery over new construction.

It’s critical to design spaces, whether new or renovated, to be as flexible as possible in the future. That means solid infrastructure throughout, and forms that will translate well into a new use when the market demands it.

Private and semi-private co-working areas are shaping up to be the amenity of the year. Re-allocating and enclosing some seating areas can add attractive conference space. Keeping those spaces visible from other amenity spaces helps contribute to a vibrant, active community feel. Today’s workforce is increasing the proportion of work done from home, and these “third places” consistently rank high. (Home is your “first” place, a workplace is second, and somewhere else – a coffee shop, a comfortable lobby – competes to be third.)

Package Handling Requires Increased Commitment of Space and Staff Time

Package handling in multifamily buildings still isn’t perfectly solved, for two reasons: volume and staffing. First, the number and size of shipments, especially in downtown properties, continues to rise. Automated locker systems present a logical solution, adding convenience when buildings don’t offer personal help from door staff or a concierge. Amazon is confident in the idea, launching their own program to add locker banks to multifamily properties.

However, a backlash is building from delivery drivers who are accustomed to making a single large drop-off – the extra time required to load the lockers is becoming unacceptable to some of the big couriers who are obsessed with efficiency and speed. As a result, we’re seeing even the best-designed high-tech package rooms get cluttered with stacks of drop-offs until someone from the building can take care of the intake process.

One building owner we’ve spoken with believes that the bigger problem with package management is the tenant that doesn’t pick up a package for several days, so they’ve investigated an app that will remind tenants every time they re-enter the area of the building that a package is waiting. These systems can help ease the burden of package management whether automated or handled by staff.

Regardless of the causes, some management groups have already learned the lesson and are opting for larger package rooms over lockers. In just the last month, FitzGerald has fielded several leads for 5-10 year old buildings that are deciding to reconfigure lobbies to reallocate space.

Many owners and property managers are still opting to provide what they see as the best possible resident experience: Personal service from a staff member. That said, a front desk concierge who is responsible for receiving the deliveries and interfacing with residents for retrieval will need their work area and package storage configured to allow for the near-constant multitask of these demands with their typical duties. In some buildings that lack 24-hour desk staff or the requisite space, property managers are offering delivery of parcels all the way to the unit, using support staff to distribute shipments and reducing the burden on the management office or desk staff.

Smart Home Technology Finally Feels Approachable

Thanks to Nest, Amazon Echo, and Google Home – as well as legacy providers such as Honeywell – smart home technology is finally being adopted by the mass market. Despite being listed on “trend” lists for two years or more, these easy-to-use consumer technologies are demonstrating the convenience and accessibility in a way that the early adoption devices never could.

Since the smart home space is so hot, manufacturers are each competing to provide a full ecosystem that covers elements like entry, audio, lighting, and assistant. As a result, mixing and matching competing products may create a situation where products won’t interact seamlessly. When that happens, consumers can turn to a service like IFTTT, which works as a universal translator to allow competitors’ products to trigger one another.

Vendors like IOTAS are also finding ways to package the necessary hardware and administration with a custom user interface so buildings can offer it as an amenity to residents, and reap the benefits of a turnkey solution for smart home technology in a rental environment. Builder-friendly integrations and software to manage turnover help take the pain points out of the building’s maintenance team having to support these complex products.

3Eleven – a brand new, well-appointed apartment building in Chicago’s River North neighborhood – has rolled out the tech to residents in 32 of the building’s premium apartments and the two penthouses. Residents can view their floorplan by room and control lights, outlets, and thermostats from their smartphone and through voice control via a provided Amazon Echo.