Four Challenges In Baltimore's Multifamily Market
New residences are sprouting up throughout Greater Baltimore, making it a good time to evaluate the state of the market. Speakers at Bisnow’s State of the Multifamily Market highlighted some of the challenges in developing market-rate and affordable housing units.
1. Providing Amenities In Affordable Housing
Amenities are just as valuable in an affordable housing project as they are in a market-rate apartment deal, says Enterprise Homes CEO Chickie Grayson (right). At left is event moderator Brad Fountain, national client manager of Partner Engineering and Science.
One of Enterprise Homes' most recent affordable housing developments, Bon Secours Gibbons Apartment, debuted this month at the former Cardinal Gibbons High School site in Catonsville. The $17M project features 80 units, and its amenities include a playground and BBQ area, WiFi and a fitness room.
Developers need to squeeze as many amenities as possible into a housing development, while keeping rents affordable, Chickie told the crowd of about 200 at the Four Seasons Hotel Baltimore.
2. Managing Development Costs And Securing Financing
Managing development costs is one of the biggest challenges associated with Baltimore multifamily projects, says Somerset Development principal Jim Campbell (right). Development costs are nearly the same as DC, yet rents are far lower in Baltimore, Jim says. Financing in affordable housing is also a challenge, as Baltimore has less money in its coffers for affordable housing compared with DC.
One way to manage costs is to consider renovating existing buildings rather than building from the ground up.
"The No. 1 opportunity in the Baltimore metro market is maintenance and renovation, not necessarily building from the ground up," Chesapeake Realty Partners COO Josh Fidler (left) said.
3. Keeping The Neighborhood In Mind
As an affordable housing developer, Baltimore Telesis is often working in a transitional neighborhood, says director Catherine Stokes (right). That means the company needs to do a lot of upfront design to make sure what they are developing fits into the neighborhood and preserves the community's character. Telesis is leading an effort to revitalize 20 blocks in central Baltimore's Barclay neighborhood.
4. Catering To Millennials
New apartments are outdoing one another with amenities—from indoor dog parks, to swanky swimming pools and lobbies that bleed into bars. If you've wondered how apartment living got to be so luxe, consider that the Millennials to which developers are catering got used to plush accommodations during their college days, says Bozzuto Development Co VP Eric Fenton (far right).
"Picture your college dorm room, compared with where kids are living now—that's like comparing a jail cell to a boutique hotel," Eric says. In designing its apartments, Bozzuto has not only taken cues from the hospitality and multifamily industries, but also tech companies to develop the latest perks to attract Millennial renters.