As the high end of the multifamily market becomes more competitive, so, too, does the amenities race it has inspired. But even as luxury apartment amenities get increasingly grandiose, multifamily development is lagging behind other industries in its use of technological innovations. As a result, multifamily apartment investors may be losing out on opportunities for income generation and customer retention. Ideally, a luxury multifamily community will have both the latest technologies and the amenities new residents demand.
New Necessities vs. Luxury Apartment Amenities
One of the challenges of designing a multifamily development is fitting the amenities to the target audience. Smart technology in luxury apartments is an obvious choice because it is in high demand among two key demographic groups of renters. Millennials’ love of technology is well known, but the Baby Boomer generation has a healthy interest in it too. A 2016 survey of renters who live in multifamily dwellings by lock maker Schlage found that 86 percent of millennials and 65 percent of Boomers were willing to pay more for an apartment with smart features. This number is likely to rise as more smart tech options are made available and retirees become more tech savvy.
Modernizing infrastructure is equally important. A high-capacity wireless network is needed to keep up with smart technologies. Given the rapid pace of technological change, it would be a good idea for developers to incorporate abundant spare capacity in the electronic and electrical systems of individual units. Another sign of the times is the need to support a variety of overlapping technologies, as the tech avant garde demand new services and traditionalists prefer older technologies, such as cable or satellite television and landline telephones.
Electronic technology software and apps for the real estate industry are also valuable for identifying potential residents and advertising to them. A variety of software applications for listing apartments have been around for several years and are familiar to most landlords and renters. Newer apps offer more advantages: Besides helping prospective residents find property listings, many provide video tours of properties and fast, direct methods for communicating with property management. Some even help landlords vet applicants and maintain files, and, after leases are signed, make paying rent and communicating with residents more convenient.
Most new technologies start out as luxuries, but some innovations become necessities once ingrained in everyone’s lives. The electric garage door opener was a novelty once. Doorbell cameras and keyless doors may prove to be just as tenacious and might soon be considered necessities, not amenities. Sometimes, global changes dictate innovation, such as expanded package reception capability in luxury buildings in response to the large role online shopping plays in modern life.
More and More Reasons to Go Green
Some innovative technologies offer more than just convenience. Green technology may attract residents and provide other benefits thanks to increasing environmental awareness. The use of green building materials, such as sustainably grown lumber and recycled structural elements, can hardly be described as amenities, but they will attract conscientious renters.
Energy-efficient technology usually benefits both residents and landlords. This technology might be the latest and most efficient HVAC system, water conservation device, or something more sophisticated, such as solar energy generation to power electric vehicle charging stations. A survey of renters conducted by the property management software producer Buildium in 2017, showed that 30 percent of renters said that energy efficiency was an important consideration when choosing a place to live, placing it 12th on a list of 19 priorities. Eco-friendliness came in 16th, with 17 percent of respondents. Home amenities was ranked 6th, with 51 percent of respondents, and community amenities came in 10th, with 31 percent.
Increasing a development’s appeal to 17 percent of the customer base may seem like a small payoff for the investment needed for green technology, but there are other motivating factors as well. Green features can be highly desirable amenities. Green roofs, for example, not only reduce a building’s carbon footprint, but also create lush common areas. The use of recycled building materials, such as wooden beams or vintage hardwood flooring, can add a feeling of luxury and customization. In addition, some cities offer significant incentives to developers to incorporate green technology in their buildings. Other cities, including Denver, require green technology for many buildings. 
While yoga studios and pet spas have an important place in luxury multifamily housing, technological innovation should not be neglected. It offers benefits to residents and investors alike and its absence will be conspicuous to some prospective renters. Choosing the most needed and most desirable technologies may prove to be a challenge but, with competent guidance, your choices should enhance the appeal of your property greatly.
At CWS Capital Partners, we are a fully-integrated multifamily real estate investment management firm that offers everything from due diligence and risk management to transaction support and property management. We specialize in assisting our clients with 1031 exchanges, acquisitions, repositioning, and development. We own and manage luxury multifamily investment communities in major markets around the country, and we employ a team of experts who can help you hone your investment strategy.
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