With many apartments having undergone stage one of the value add and interior upgrades, we are constantly evaluating other ways to add value to the properties to generate either additional income, raise rents, reimburse expenses, or keep vacancy at a minimum by differentiating the property from others.
Based on recent research published in CRE Daily (see chart below), the top five amenities tenants appreciate most include – onsite food and beverage café, meeting space (work from home trend), fitness and health facilities, environmentally friendly features (such as energy saving equipment) including electrical vehicle charging, and access to parking.
As more people are working from home and back to the office at best two-three days a week, amenities such as onsite food and beverage and meeting/working space (and proper infrastructure such as high speed or WiFi connections) make sense as residents telecommute more and spend more time at home.
Health and wellness is not necessarily a new category but the amenity list below is expanded to include outdoor space, as people got used to staying active outdoors, given gyms were closed for a prolonged period of time. Having such outdoor space also contributed to the ambiance of the property.
With the advance of technology and increasing demand for hybrid or fully electric vehicles, demand for charging stations is gradually increasing and can be a great differentiating factor. Energy saving and water saving equipment also helps keep utility expenses low thereby helping manage the costs for the tenants who are already impacted by inflation and higher overall cost of living.
Lastly, unless the apartment building is located in an urban area with easy access to public transport, it is more likely that people will drive to work or to run errands. Therefore having adequate parking for residents and their guests can be an added convenience. Residents are often willing to pay for assigned parking too, which can be an additional income stream.
We were surprised to see that pet amenities (such as dog park or a pet spa) and Amazon lockers did not make the list below. With the rise of e-commerce and especially post Covid 19 many people transitioned shopping for staples and other merchandise to online. Having the lockers helps avoid clutter and numerous packages dropped off in the leasing office (if there is one on site) or worse off – being dropped off in the building lobby where the risk of theft is higher. Pet ownership continues to grow and we have found that allowing pets, not only increases the lease up rate of the property but also generates additional income via pet fees. Perhaps these two categories were represented within the broader categories summarized below. Yet we wanted to call them out as they tend to be highly rated by residents too based on our own experience.
Source: CRE Daly
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