Unit Sizes Coming Down Again As Remote Work Renters Gravitate To Common Spaces
The amenity war among Atlanta’s luxury apartments has grown more social since the depths of the pandemic as renters look for places to gather outside of their units.
The desire to socialize, especially due to the expansion of the work-from-home revolution, coupled with rising construction costs, has resulted in apartment units that are shrinking in size, panelists said during Bisnow's Southeast Multifamily Summit last week.
“You started to see a lot of one-bedrooms with dens, larger one-bedroom areas where people could just work from home. But now that we’re a couple of years [into the pandemic], we’re starting to see a lot more work-from-anywhere appetite,” Proffitt Dixon Partners partner Ashley Peterson said at the event.
Panelists said certain amenities will always remain popular, such as pools and propertywide WiFi, but residents are flocking to more public gathering spots instead of spending more time inside their units, which is allowing developers to reduce unit sizes in some cases.
“People are going back to the more efficient studios or the smaller one-bedrooms, and there is a lot more emphasis on having unique amenities in your property,” Peterson said during the Thursday event at the Thompson Buckhead hotel. “Specifically, coworking has been huge in the last few years. You're continuing to see that activity throughout the amenities within luxury properties.”
Developers at the event said the size of coworking spaces in apartment properties is rivaling, if not outstripping, the size of the clubhouses and community rooms.
"I've got three projects in design where the coworking space is larger than the club space: 8K SF of coworking space," Smallwood principal Mark Valliere said onstage.
Panelists also said storage rooms are increasingly popular among residents, a feature echoed by the 2021 Apartment Guide Amenities Survey, which listed storage space as one of the most sought-after amenities in U.S. apartments, behind a dishwasher and fast internet speeds.
Morgan Properties Area Marketing Manager Jamal Lee said smart technology infused into the units is another major selling point among luxury properties, even if the resident ultimately doesn’t utilize the devices.
“Right now we’re seeing commonalities across all generations as it relates to behaviors, habits and expectations,” Lee said. “Today’s consumers really want less in-person interaction and more self-service options and a highly personalized experience.”
But amenities aren't the only reason unit sizes are coming down. It is one way to achieve more affordable housing, especially as construction costs, inflated land prices and hiked interest rates crimp developers’ abilities to build lower-rent units to meet the burgeoning demand.
CMC Development President Shaun Belle said that residents are going to have to face a change in lifestyle to allow for more affordable housing options, including the sheer area of the average apartment. Belle said a 700 SF apartment in New York is the way of life, but one that size in the Southeast is a hard sell.
“We have to kind of change the way we live,” he said. “Because if we can think about living in a smaller unit, we can perhaps deliver more. We’re accustomed to these big apartments where in other places in world markets, [units] aren’t so big.”
Five Points Development is developing an attainable housing project in Metro Atlanta where it had to “strip down” the amenities to make the project work financially on lower rents, founding principal Cassius Coleman said. Coleman didn't identify the project.
“You’re basically lowering what you’re offering that tenant,” Coleman said. “We aren’t happy about it, but that’s basically what you have to do.”