The profile of the typical renter has changed dramatically in the last decade. For many renters, renting is no longer viewed as a stepping stone to homeownership. According to The New American Dream report from property management firm Entrata, one in five renters today expect to be lifelong renters. They like the geographic and financial flexibility that renting offers and report that renting better fits their current lifestyle.
Many of these renters see an apartment as an opportunity to gain luxury features that they might not have access to as a homeowner. This makes amenity space design an edge for multifamily developers looking to distinguish their properties from competitors.
However, achieving this distinction isn’t as simple as installing the latest trending amenity. In planning for the features that will attract and retain renters, developers need to understand the unique expectations of their target demographics.
They should consider strategies for incorporating the distinctive elements of their neighborhoods into their planning to create a more cohesive sense of community. And they might take a lesson or two from boutique hospitality destinations that have mastered amenity space design.
Let amenities reflect your brand story
Multifamily developers know their renters have higher expectations for amenities, but it’s essential to recognize that those amenities should differ across every property.
The hospitality industry has long mastered this strategy of infusing its brand story with local flavor. These carefully crafted destinations extend a strong sense of place, identity, and authenticity.
Much like boutique hotels and clubs, for example, multifamily developers can weave common program elements across properties but should design amenity spaces with local needs and desires in mind.
Understanding these needs and desires begins with understanding why people are choosing to rent in the area.
Are your target renters looking for a base from which to easily commute or enjoy a highly walkable city? Are they young people who want upscale shared amenities while they “scale up” their own personal spaces or retirees looking for a home base while they cruise part-time? Getting a sense of what makes your location appeal to renters can help identify the types of amenities that will resonate long-term.
It’s also important to understand target renters’ values. For example, younger generations are increasingly prioritizing physical and mental health and wellness. When development sites are near biking trails, parks, or local farmers’ markets, designing thoughtful connections to these shared spaces allows them to also serve as an extension of your property.
Similarly, apartments in a location with a vibrant arts scene can benefit from installing “maker” spaces that allow a hands-on connection to the arts. By designing spaces that include 3D printers, pottery wheels, and professional-scale easels, residents in the area can participate in the on-site creation of art in their communities.
With a stronger understanding of renters’ values and interests, multifamily developers can become more intentional with their amenity programming.
Inviting spaces are made with intention
Effective space planning design that will drive long-term ROI requires looking at amenities as more than just a box to check. For example, renters have proven that they are willing to pay more for monthly rent at an apartment with a fitness center that allows them to drop membership at a nearby gym. But in our experience, installing a few treadmills and weights isn’t enough.
Amenities must be selected and designed with a high degree of intentionality to ensure the space will benefit from high utilization as intended. This begins with considering how renters will use and navigate your property, while also thinking through which amenities your team can plan, execute, and service well.
For example, dog-washing spaces are becoming increasingly common, but designers don’t always think about how these spaces are actually used. Is there space to contain more than one dog? Can the dog spa be located near a dedicated pet green space? And if pets are a priority, will renters have access to pet-friendly common areas where they can spend time with human and four-legged friends?
Asking these questions leads to more thoughtful amenity space designs that ensure you get the results you are actually after: above-average retention rates, record lease ups and rent growth.
It’s also important to recognize that each property must be developed to meet a unique demographic’s needs. When certain multifamily trends are proclaimed passé, it may be that they simply didn’t meet the needs of this particular market.
So before omitting coworking spaces for example, dig into whether your future residents will include work-from-home professionals or lifelong entrepreneurs who need dedicated space to work or residents with a “side gig” who need the space during non-traditional business hours.
Community spaces command higher rates
When designed with intention, communal spaces create long-term engagement within communities – and this doesn’t just benefit renters. The National Apartment Association has found that residents will pay up to $200 more to stay in a community where their friends live.
Meanwhile, a study by rental technology company RealPage found that a renter who knows seven or more people in their community has a 47% likelihood of renewing their lease compared to a 29% likelihood for a renter who doesn’t know any neighbors.
Every development should allow for opportunities to create community engagement. To this end, many multifamily developments are taking a page from the hospitality book and incorporating third-party food and beverage offerings. Residents can grab coffee before heading to a coworking space or enjoy a craft cocktail or self-tap beer in a shared lounge.
However, an advantage unique to multifamily properties is the opportunity to engage residents in enhancing the community. Property owners can invite their resident yoga instructors to lead regular yoga sessions on the lawn or encourage tech-savvy residents to set up a movie by the pool.
Giving residents access to a shared space designed to feel like an extension of the home provides a stronger opportunity to create community engagement – which is the key to sustainable returns.
Strike the right balance with your amenities
Multifamily developers already know that amenities are key for attracting today’s renters. What they may not recognize is that the right amenities can increase the return they see on their investment.
With the right expertise, it is possible to select features that balance functionality, aesthetics, and budget. An interior design partner with experience in the hospitality sector can help multifamily developers create more marketable spaces that draw in new residents and encourage renter stickiness.
If you’re ready to become more intentional in how you attract and retain residents, Thiel & Team can help. Let’s start planning today.
