Developing apartment communities that appeal to all age groups.

While the apartment narrative has long focused on the 20-something as the typical resident, rentership rates among all age cohorts have been steadily increasing during the past decade.

With many of the 73 million baby boomers in the United States having become empty nesters, that cohort accounted for 58.6 percent of the net increase in renter households between 2006 and 2016, according to NMHC tabulations of U.S. Census data.

With a wide variety of renters to consider, designing a building for a Millennial renter that answers to their demands may seem like an entirely different ball game than one for a Boomer 30 years older. “What [different renter segments demand] can almost feel like an industry in itself,” says Walter Hughes, Chief Innovation Officer at Dallas-based Humphreys & Partners Architects, which designs everything from market-rate properties to niche product types like student housing and senior communities across the country.

But with rising construction costs, which are up 39 percent over the last decade, and vacancies at historic lows according to a report from the Harvard Joint Center for Housing Studies, developers don’t have the luxury of building niche properties tailored to every specific renter profile.

Instead, savvy companies must position properties to appeal to a broad range of renters, now and in the years ahead. While different generational groups may have different desires in different stages of life, a lot of their basic needs align and can be satisfied with the same core offerings, provided companies offer the flexibility for renters to conform the space to their needs.

A well-designed, flexible building that takes versatility and functionality into account is not only able to address the niche demands of specific demographic groups while serving a mass audience, but also grow and evolve to remain competitive as new product comes online.

One Size Doesn’t Fit All

For most renters, it’s not just about what they’re looking for in their next home, but where they’re looking for it. The “location, location, location” mantra holds for all age groups. These renters, whether they’re 25 or 65, are all looking for the live-work-play lifestyle.

“Downtown renters across the spectrum are looking for all the benefits that a city offers, like going out to restaurants and bars, and having an urban experience,” says Hughes. “That’s something the city itself provides for them, not your building, so these renters are really paying for location, and you’re just providing them with a nice place to sleep.

“A Boomer might need—or at least be able to afford a larger unit, and a younger renter can live somewhere smaller, but neither one is fixated on the amenities, because they’re paying for those via the city itself.”

To be able to afford the city lifestyle, some renters opt for significantly smaller living spaces; therefore, many developers have incorporated micro-apartments into their projects. These small apartments typically measure about 400 square feet—less than half the size of the average 941-square-foot new apartment, according to RentCafe’s Yardi Matrix data—and lease at a 20 to 30 percent lower rate than conventional apartments, says a study by the Urban Land Institute.

Hughes is currently working on projects that will offer micro-apartments in Nashville, Tenn., and Kansas City, Mo. The company focuses on maximizing the tight space to feel livable and open for residents. With little space to work with, the one key to designing a functional micro-apartment is incorporating semi-private areas into space.

“The unit is very open other than the bathroom, and is just one large space. We incorporate little tricks like hanging curtains or building in half- or semi-frame walls to give someone the feeling of having their own private nook,” says Hughes.

Furniture solutions can also go a long way toward making the small space work in a versatile way, serving myriad uses throughout the home.

“There are a lot of new options for robotic furniture—push- and pull-out systems that can serve as combination Murphy beds, desks, entertainment centers and more,” says Kurt Schultz, Principal and Director of Housing at architecture firm SERA’s Portland, Ore., office. Schultz specializes in designing urban infill housing projects in Portland and other markets on the West Coast.

“We have been adding [these furniture systems] in our projects to give more flexibility of space and function to the units,” Schultz adds.

Small-scale appliances, like an under-counter fridge, for example, and clever storage systems (Hughes says many of his micro apartments even feature a full walk-in closet) can also help save space indoors, while large windows that let in natural light and additional Juliet balconies for an outdoor escape help the apartments feel larger.

Penciling Out

With the rise in construction and labor costs making building more and more expensive, developers have had to find strategies to make the product more efficient without increasing the cost. In turn, this allows companies to bring larger apartment homes to market and therefore appeal to a wider variety of renters and household types.

“Across all our product types, we have concentrated on increasing efficiency to build projects at a higher density,” says Hughes. “You get more units per acre on a site, so your cost per unit goes down dramatically.” The key to making the numbers work, Hughes says, comes down to one thing: Circulation. “The typical apartment building has a big corridor on every floor, but that corridor is what kills you. That, and stairs, because you end up losing about 20 percent of your building to circulation,” he says. “So what we have done is cut down on the amount of circulation.”

This strategy is allowing Humphreys & Partners to deliver projects at over 90 percent efficiency. Comparatively, Hughes says, the average two- or three-story suburban garden apartment project comes in at 78 to 80 percent efficiency. For a typical 200-apartment deal where the apartments are 1,000 square feet, that can mean a savings of millions of dollars at today’s construction cost per square foot.

The technique has been a game-changer, especially as the go-to solution of building smaller apartments isn’t always the answer to affordability, says Hughes. For many renters, especially downsizing Baby Boomers coming out of a spacious single-family home, a compact apartment doesn’t cut it.

“You can’t tell a Baby Boomer, here’s your 5-foot strip closet when they’ve been used to having a walk-in for over 20 years, or that they don’t have an in-unit washer and dryer anymore,” Hughes says. “And good luck telling them there isn’t space for a dining table. Even if they’re not actually using it and are eating dinner on the couch, it’s something that they want because they’re used to having it. All of those things start costing you a lot of area and space, so those units are going to be on the larger side.”

Schultz agrees that micro-apartments can work for some renters and the market still sees demand, but developers shouldn’t operate on the assumption that Millennials want a small space just because they’re young.

“At least in Portland, we’re even seeing a shift away from that toward larger units,” says Schultz. “We have built a fair number of two-bedroom units, assuming they’d be for downsizing Boomers, but those actually get rented by Millennials in roommate situations just as much as they are by Boomers. So we haven’t really been seeing one building full of only empty-nesters and the other building full of only Millennials, and our clients haven’t been asking us to try to tailor units too much
to one specific generation. Instead, we have been seeing much more focus on flexibility.”

Getting Personal

In a recent consumer insights survey from the NMHC, 94 percent of respondents say that being able to personalize their space is important, 83 percent stress the importance of having space that evolves with different stages of their lives, and more than three-quarters (78 percent) say they value having a convertible space that can be transformed to meet different needs.

At Atlanta-based Wood Partners, Product Manager Misti Morales and her development team in Houston and the country’s central region strive to make sure their unit designs can accommodate different living arrangements, considering how layouts and configurations could suit renters however they choose to use the space.

“It’s about the experience when they walk through the door of their home—what’s their lifestyle like, and how are they engaging with the floor plan?” says Morales. “Are we designing to acknowledge both a roommate situation in a two-bed, two-bath unit the same as if we have a dual-income couple with kids, or if we have empty nesters? Each one of those consumers is going to use that floor plan in a different way.”

For example, Morales says, consider the epicenter of the home—the kitchen. Be mindful of islands and eating spaces, thinking about whether there is enough room to provide seating for situations where anywhere from two to six people are eating.

“There is a very dynamic shift that can occur when a new resident moves in, so we are mindful of [the apartment] being used in multiple ways and appealing to a more mass audience,” Morales adds.

Interior design, too, is essential to tailor to trends while also keeping it an agnostic feature of the home that can fit renters’ individual design styles and preferences. This is particularly true for the kitchen, where a majority of fixtures and product selections will come into play and have the most impact.

“What we are finding is that we really can’t necessarily focus on what a particular ‘look’ is, but instead [must] consider how we are selecting products that have a long-term, timeless appeal regardless of what someone’s design preference is,” says Morales. “We pick finishes and selections that have multiple cross-sections of consumer attraction, so that whether someone has a mid-century mod taste, they’re more bohemian, or very traditional, that [kitchen space] is easily integrated into their lifestyle.”

The emphasis on flexibility and versatility extends outside of the apartment as well, affecting how developers treat extra amenity spaces. Wood Partners considers how extra space in each floor of a podium or wrap building can be used in various ways, and identifies how those flex spaces can best serve renters’ current—and future—needs.

Instead of having additional storage space on each floor, Wood Partners may install a meditation or virtual fitness room so residents can remain on their floor instead of having to go to the main fitness center, says Morales.

“It really comes down to making sure the infrastructure is available, and as we see new products come online, those features are an easy addition or pivot for the project to make,” adds Morales. “We are really dialing into ensuring that our floor plans and designs are suited to pivot in the event of a shift in the submarket or demographic wants and needs.”