50 percent of American renters are classified as “cost-burden”–usually resulting in rent being their primary expense, even as high as 35% of their income. With the current economic trends and an unprecedented drop in the economy due to the pandemic, these numbers are only anticipated to worsen. With more than 20 million Americans in search of attainable housing, there’s no denying that the overwhelming market demand seeks sustainability in multifamily properties. For apartment managers, owners, and developers mapping out the next few years–attainable housing is undeniably what’s hot.
Ever since the 2008 recession, a focus on high-rise luxe living has taken center stage in the rental market. As the numbers start to skew in order to serve the meat of the American workforce earning 60 to 120 percent of Area Median Income (AMI), here’s how the average multifamily property can competitively optimize rental opportunities in favor of the trend.
Bridging the Gap Between Luxury and Affordable
Developing attainable housing is a complex process. With costs and impediments rising, experts suggest building a workforce unit is often as expensive as a market-rate unit which leads many developers to rely on subsidies. But with the sheer size and scale of the current demand, builders who can are avoiding subsidies and the restrictions that come with them. Instead, they are
- Building smaller units on smaller properties to keep per-door costs and lease-up risk down
- Plotting larger developments with higher unit numbers aimed at a broader segment of the population to gain economies of scale
- Convert office building into affordable housing options
By making land deals that make sense–most significantly depending on location and whether municipalities will give them abatements on parking ratios, developers are balancing the scales by eliminating most amenities and scaling back on finishes. Keeping costs in check requires a level of standardized designs and materials to gain efficiencies with their general contractors and to participate in purchasing programs that create significant savings when buying in bulk.
Finally, since many developers aren’t accepting government money and all the strings attached to subsidies, they can take advantage of federal Opportunity Zones and local entitlement allowances that waive impact fees designed to encourage the development of attainable housing.
Cut Costs Without Quality Features
Ground-up attainable housing projects continue to emerge nationwide as prominent developers and investors continue to build in favor of the dominating market trend. As building and developing strategies become stabilized and accessible a “prototypical” design emerges for attainable apartment units nationwide. The cookie-cutter approach works to make building feasible but leaves little room for creating a competitive edge.
If you’re not starting from scratch, here’s what can you do to create a multifamily property with units that are tangibly priced while remaining competitive.
Limit Social and Service Amenities
For a majority of Americans seeking attainable multifamily housing valet parking, comprehensive fitness features, a roof-top deck, and movie theater aren’t priorities. Ditch “showy” social and service amenities in place for high-quality essentials like modern, secure self-storage and pet-friendly features.
Increase In-Unit Amenities
Forego the dreaded onsite laundry mat and save money (and property value!) by purchasing in-unit washers and dryers or furniture in bulk. Furnished unit options are more economical to the majority of renters living paycheck to paycheck–many renters consider furniture a physical and financial burden a prefer to spend an additional premium each month over investing thousands of dollars on purchasing new.
There’s no sense in the effort to make rent affordable if tenants have outrageously high utility bills. Sustainable options for multifamily properties are accessible and increasingly common. Smart AC functionalities and solar power panels are just a few ways to improve the property’s sustainability, attract and keep environmentally conscious residents looking for long-term attainable multifamily housing.
Create Affordable Opportunities
Cutting costs by limiting high-end features plays an important role in making rent affordable. But for multifamily properties seeking to provide opportunities for onsite features, Bradyl storage has options that will create ancillary income while giving tenants the chance to additional storage space on a monthly basis. Off-site storage fees are predominantly $101-$150 a month–a hefty price for Americans seeking affordable rent options. However, these multifamily residents are desperate for a private, secure, and efficient way to store their belongings.
Bradyl Storage Solutions quickly picked up on a need that continues to be ignored by properties who are cutting far too many corners leaving property managers in the red and tenants with limited access to amenities.
Bradyl’s Amenity Strategy
At Bradyl Storage Solutions we are in the business of win-win opportunities for property owners who are stuck in a cycle of fluctuating market trends and meeting the demands of residents from all socio-economic backgrounds. We foster ancillary revenue of up to $5 per square foot, offering an abundant and modern opportunity to transform any available space into increased profit. Our independent survey highlights that residents will pay an additional $5-$30 more per unit for Bradyl Bins compared to the other, less private, options.
Whether you choose the Bradyl Box, Bin or Pod, teaming up with Bradyl Storage Solutions helps you stand out amongst the cookie-cutter attainable housing structures, presents flexibility for tenants on a budget, and provides ancillary revenue. It is possible to remain competitive amidst a gloomy market trend. Contact us today to receive an estimate of PSF income potential for your building and find out how just how easy it is to transition your multifamily property.