CBRE Research | What renters really want: amenities change the leasing game

• Multifamily’s pool is getting deeper. Those choosing to rent over owning is mounting across the U.S. as both young and mature are picking apartments over single family homes. Baby boomers transitioning to a low maintenance lifestyle and young professionals delaying home ownership are comprising larger sections of renters.

Choosy renters have more choices
And they face a lengthy menu of amenities within new apartments in both urban and suburban settings. A recent National Multifamily Housing Council/Kingsley Apartment Resident Preferences Survey identified the top ten amenities on renters’ lists such as pet play and grooming areas, added parking and of course access to highest-speed Internet available. Likewise, developers are stepping up their game and offering additional luxe features to attract renters to new developments replete with wine storage, concierge services and even massage suites and on-site dry cleaning pick-up.

Source: National Multifamily Council, CBRE Research 2016.

Developers going social on the multifamily network
Amenities emphasizing residential interaction are becoming increasingly popular – bowling alleys, coffee bars (for example, the 35 West Apartments in Moore, OK), and expansive recreational areas (such as the rooftop pool at District at Memorial, a 327-unit complex in Houston and the rooftop lounge at The Taylor in Dallas) are all dynamic examples. Trendy comforts are also becoming increasingly grandiose; at The Kenzie in Austin there are four electric car stations and The Mansions Woodland have indoor tanning facilities. Dry Creek Ranch II, the 168-unit community in Northlake near Dallas boasts a dog park, a fishing pond and also indoor basketball court leaving those facilities built in the 1990s – and even the 2000s – appearing behind the times.

Owners can afford to maintain all these high-quality amenities because the properties stay well leased while commanding premium rents, some $0.50-$1.00 more per sq. ft. than the market average. Rivera in San Antonio, just a short stroll from the River Walk, is asking $1,492 per month on average; The Taylor in Dallas is currently charging $1,940 per month or $2.30 per sq. ft., while the Dallas Class A average rate is $1.48 per sq. ft. But Austin’s notoriously high rents continue to get higher. An apartment home at The Catherine in Downtown Austin is $2,327 per month, which is $2.59 per sq. ft. or $0.84 per sq. ft. higher than the average rate in Austin’s Class A properties.

Top Lease Decision Factors

Source: NMHC/Kingsley Apartment Resident Preferences Survey, 2015.

Life, liberty and the pursuit of ~~property~~ happiness
Even Jefferson himself realized back in 1776 that not everyone wants to own a home to be happy. These modern-day amenities are part of the long-term shift toward renting, as the There is the care-free convenience of having a dedicated maintenance team (and sometimes same-day service) for anything from a broken dishwasher to a burned-out bulb is a time saver for busy young professionals and a goodbye to the weekend ‘honey-do’ list for former homeowners. Despite the marginal boost in national homeownership over the last two quarters, the percentage of people pursuing mortgagee status still hovers at lowered levels that haven’t been witnessed since the late-1960s. With the pendulum swinging toward higher quality amenities and comforts, the apartment appeal proves there isn’t just one interpretation of the modern American Dream.