There’s been a massive shift in multifamily value-add over the last five years, Cortland CEO Steven DeFrancis told the crowd at Bisnow’s Multifamily Annual Conference South last week. Value-add acquisitions were very hard to capitalize at the time, but now it’s a core strategy for Cortland.

Steven (here between fellow speakers RSM USA partner Mike Beacom and Embrey EVP John Kirk) says his team focuses on redefining what a property is both physically and operationally, and often includes two to three years of re-tenanting. Cortland spends about $25k/unit to renovate, often by updating the kitchen (it’s low-hanging fruit since the standard for apartment kitchens has changed so dramatically over the years) and adding bathrooms in two-bedroom, one-bath units.

For new construction, Cortland and Embrey Partners offer multiple floor plans. Steven says residents love having more options, and over time it gives a property more pricing traction because it creates scarcity of each type. It can be pricier to build and take more time—likely not winning you any brownie points with your architect—but it’s a solid benefit, he says. John agrees, but says Embrey is steering clear of letting residents customize their units. He says it’s more effort and cost than it’s worth, and that you have to rework units as you backfill them.