July 8, 2019
By Ben Johnson
Apartment developers today are focused on both core “main and main” locations as well as suburbs in their quest to bring new product to the marketplace, according to participants in a “Development 2.0” panel during the recent Connect Apartments 2019 conference. The event featured more than 400 attendees at the JW Marriott at LA Live in downtown Los Angeles.
Panelists included moderator Jeffrey Krohn, President and CEO of Maverick Residential Company; Joe Gambill, Vice President of Development at Wood Partners; John Readey, Senior Director at UDR Inc.; Nick Griffin Executive Director of the Downtown Center Business Improvement District in Los Angeles; and Patrick Winters, Principal, Design Director and Partner at Nadel Architects.
According to Gambill, today’s development capital is focusing on projects in the absolute best locations in both downtowns and the suburbs. “It’s late in the cycle and there is some concern,” he noted.
In general, developers have also become more cost conscious, said Winters. “A key word for us is affordability with many of our clients,” he said. “Much of our work is focused on main and main locations, [the] last year or so clients [are] looking at secondary and suburban markets.”
Developers always keep a watchful eye on renter tastes in layouts and floorplans, which are changing as well. “There is greater interest in loft-like units, longer and narrower, with higher ceilings with a cool feel that is really desirable,” said Winters.
Overall, Baby Boomers are demanding larger floor plans, and the notion of “co-living” is also a trend, Winters said.
On the trendy subject of micro units, or apartments with around 350 square feet or less, they do present a huge opportunity and the demand is there, said Gambill. “The younger people are wanting to be in the urban core and don’t care about the size, they want the experience.”
Readey said that UDR is not a “first mover” in the micro apartment market, but believes it will continue to prove popular among renters.
When it comes to other trends in the market, Winters noted that developers are requiring more efficiency in units to meet renter demand. For its part, UDR is experimenting with a smart tech program, and is monitoring its impact, said Readey.
As for amenities, many developers have embraced unusual and innovative offerings, but Gambill said he is not convinced those are effective. “Over the last year it has turned into a circus, but we do agree that elevating the tenant experience is very popular right now. We try not to play the fads, but we did just put a bowling alley in one project.”
“The number one amenity for us is the location,” said Griffin, speaking primarily of downtown Los Angeles, which has seen a multifamily building boom of late. “People who want to stay right here in downtown will want to make it their own. People want the social experience, and the extent to which some of that is happening outside the building as well as inside the building is part of that continuum.”
Any new development should, particularly in an urban setting, try to embrace the local community. Gambill noted that for the past five years Wood Partners has been working on a “Ground Floor” project that essentially brings nearby amenities into the building to create a buzz to live there.
All of the panelists did agree that the once-popular amenity of theaters is now a thing of the past.
Connect Bay Area is coming up July 18, 2019 at the Grand Hyatt San Francisco. Get more information, and register to attend on this link.
For comments, questions or concerns, please contact Dennis Kaiser