Along with dog parks and third-wave coffee shops, the high-end, over-amenitized apartment has become a contemporary urban cliche. Luxury apartments aren’t new. But today’s developers have elevated to an art form the practice of including amenities that pander to millennial lifestyle trends.
In Seattle, where the Amazon-fueled boom in luxury high-rises added so much inventory that rents at the top of the market have actually dropped, everything from a bowling alley and arcade to a communal treehouse have been built as bait to attract new tenants. Contemporary New York apartments offer dog yoga and guitar lessons. In Detroit, planned developments feature smart lockers, pre-installed smart home assistants, sky terraces with fire pits, and on-site vehicles for rent. In San Diego, the forthcoming development features an infinity hallway, a vaulted mailroom lined with gold, an outdoor chef’s pavilion, an open-air garden in the round, a maker’s space, and a design scheme that references technological progress, from the industrial revolution to 2001: A Space Odyssey.
Are these amenities a bit over the top? Definitely. But they reflect significant shifts in how apartment dwellers—and developers—think high-rise living should evolve. The nation will need to add 4.6 million new units by 2030 just to keep up with the demand for apartment living, according to “Disruption,” a report by the National Multifamily Housing Council (NMHC). The building boom has forced the industry to be more anticipatory as it tries to design units that are “more personalized, flexible and adaptable to changing lifestyles and needs.”
“The top two ways to separate yourself in a market that’s seen so much activity is adding an infusion of technology, and giving your residence some kind of identity,” says Shauntá Bruner, a senior associate with Delta Associates, a commercial real estate research firm. “Everybody has a rooftop grilling area or a dog park. Successful developers need to create things that tell a story and tie together the community.”
Bruner says that this boils down to better tech and more services. A majority of younger renters agree: 58 percent of millennials surveyed in the NMHC’s 2018 Consumer Housing Insights Survey believe apartments should provide helpful services and amenities for the surrounding community.
Smart apartment technology—especially when it comes to locks, in-building messaging, and energy efficiency—has attracted greater interest from landlords, developers, and tech firms, says Zach Aarons, a co-founder of real estate technology, or proptech, venture capital fund MetaProp. Newer buildings, like the Eugene, just one block from New York’s Hudson Yards megadevelopment and tricked out with tech-enabled concierge service LIVunLtd, exemplify this trend.
“It’s going to be a required thing,” says Aarons. “Developers will feel they need to pre-wire their apartments.”
Technology and services trump gyms and rooftops
Though it may seem like sheer marketing, there are economic motives fueling the amenity wars. Developers feel challenged by restrictive zoning, as well as rising labor, land, and construction costs, which make it harder to turn a profit on a building that’s not decked out for high-income renters.
And high-income renters are a growing demographic. The number of renters making over $100,000 increased by 5 percent nationwide in 2017, according to the most recent rental-market report from Harvard’s Joint Center on Housing Studies, while 19 percent of Americans making six figures rented, an all-time high. The competition for these renters has increased the pressure to add more amenities. In 2016, 86 percent of new apartments offered swimming pool access, and 89 percent had in-unit laundry, according to Harvard figures.
Renters who pay a premium want ease and convenience, and increasingly, that’s translating into a desire for more services, better technology, and new spaces that can accommodate both.
“As technology gets more advanced, so do amenities,” says Caitlin Walter, vice president of research at the National Multifamily Housing Council. “The old fitness center with treadmills and weights isn’t going to cut it. Now, renters want a Peloton.”
Reflecting shifts toward e-commerce and online shopping, one of the most popular new amenities is package delivery services, Walter says, including dedicated lockers. Some are even configured for laundry or refrigerated to hold grocery deliveries. Many of the new upscale urban apartments include smart locks, which not only reflect a more app-centric existence but, by making it possible to remotely control entry and exit, streamline access for the new generation of online service providers.
While adding smart home tech to apartments can be complicated owners find value in creating more efficient buildings and offering more services. Hello Alfred, the concierge service startup, and Baroo, which offers walking and doggie daycare services, have used mobile tech and increasingly wired apartments as a means to reach customers in high-rent areas. Emerging companies like Dwello, a payment system that functions like Venmo for rent, and Amenify, a platform that connects renters with a number of service and “experience” providers, have both moved the landlord-tenant relationship online and made it more robust.
Taken together, there’s a concerted push to create digital platforms for apartment living, and offer easier access for digital providers of cleaning services, dinner delivery, and other deliveries.
Creating community in apartment buildings
What these technological solutions offer in ways to simplify life with the tap of a phone screen, they often lack in human connection. Perhaps thanks to the rise of tech amenities in high-end apartments, the desire for community as an amenity has grown. It’s not just about offering community gardens or rooftops; it’s about planning events and finding ways to link residents.
As Delta Associates’s Bruner puts it, that means “bringing in a yoga instructor, not just creating a yoga studio.”
Bruner finds the best property managers have turned features into events, and find more creative ways to make use of areas like communal kitchens. Two apartment complexes in the Washington, D.C., area, the Pearl in Silver Springs, Maryland, and the Ten at Clarendon, in Arlington, Virginia, feature community gardens, a particularly popular amenity. But the management companies go one step beyond and contract with a local gardening company, Love & Carrots, which provides residents with monthly samples of vegetables and herbs harvested on the premises and demos preparations for these ingredients.
Many properties now hire outside companies to manage resident events. Michael Wittich, co-owner of Axiom Amenities, works in New York City and a handful of other metro areas and helps plan community events for apartment owners and property managers.
“Amenities aren’t what’s selling units anymore,” he says. “Oftentimes, renters live on a floor with 15 other people, and don’t know any of their names. People just don’t want to interact with each other; they’re just not used to doing it. We’re helping that along, and breaking down those barriers.”
Data from recent NMHC surveys suggest community is top-of-mind for renters. The 2018 Consumer Housing Insights Survey found that 83 percent of respondents believed face-to-face socializing with friends and family is an important housing feature, while 58 percent believed apartments should “provide helpful services and amenities for the surrounding community.”
Creating a specific community, and using it as a selling point, informs the business plan of KIN, a family-focused coliving community devised by developer Tishman Speyer and coliving operator Common. According to Brad Hargreaves, Common’s founder, KIN will be a testing ground for a new ground-up app that Common’s tech team designed for residents to communicate, meet each other, and ideally form community.
“The really, really interesting stuff comes from unlocking the idea of density, when you have a lot of people with similar needs in one place,” he says. “I think the basic level of success for KIN is if we’re getting residents to book and share babysitters together through the app. That’s the kind of thing residential operators haven’t done in the past, and it’s a big opportunity.”
Hargreaves, who has promoted Common and coliving as vehicles to build community in our estranged digital age, says that 70 percent of his company’s residents have moved to a city for the first time. Of course, as a coliving space, Common serves a specific clientele. But that statistic just illustrates the potential power landlords, developers, and property managers have to shape spaces made for community and relationships.
“Having connections based on shared interests is table stakes,” says Hargreaves. “As a residential operator, I want to make sure we exercise that power and serve that up to our members.”