February 26, 2023 |
Updated February 27, 2023
In many ways, build-to-rent (BTR) homes can be thought of as a hybrid between single-family homes and townhomes and apartments.
This article is an excerpt from the January/February 2023 units Magazine article, "Build-to-Rent: Challenging Times Yield New Options & Strategies."
Size and price. Most communities offer townhomes and single-family homes. Adam Wolfson’s Miami-based firm, Wolfson Development, is completing its first project, Cantabria, with 184 homes on the Bradenton, Fla., property. Homes will feature three and four bedrooms, measure an average of 1,500 square feet, have attached garages and be priced from $2,600 to $3,400 a month. It’s starting work on Encanto Isla in Kissimmee, Fla., with 214 units and a similar number of bedrooms, square footage and prices. “All are larger than most apartments and somewhat comparable to houses, a big part of the appeal to consumers,” he says.
RKW Residential, now owned by Hello Alfred, entered this sector as a manager a few years ago. “We identified BTR as an attractive option for renters due to the broader housing affordability issues and increasing demand for more space and privacy,” says Joya Pavesi, Executive Vice President of Marketing and Strategy at Charlotte, N.C.-based RKW Residential, which manages Sands’ BTR Seaglass Cottages Apartments in Myrtle Beach, S.C., and many additional BTR communities.
The developments that Peter Chacon’s Northmarq firm is involved with reflect similar numbers and a mix of attached townhomes between 1,300 to 1,400 square feet and prices from $1,500 to $2,000 a month, and single-family homes of 1,800 to 2,100 square feet and prices between $2,000 and $2,500 a month, he says.
At Deercrest Townhomes, a new community of 64 rental townhomes in Antioch, Ill., square footage ranges from 1,400 to 1,700, with big driveways and garages adding to the feeling of space, and prices from $2,200 to $2,500, says Diana Pittro, Executive Vice President at Chicago-based RMK Management Corp., which manages the development.
Sarasota, Fla.-based Pearl Homes’ Founder Marshall Gobuty has taken a similar approach with his OurLives community in Ellenton, Fla., where single-family homes will range from 900 to 1,800 square feet and rental prices from $1,600 to $2,600 a month when completed in 2024.
Location. Locations vary too but share some commonalities such as being near good employment opportunities and schools, retail and other services and sometimes transportation hubs, though with WFH that may matter less.
Wolfson’s firm favors sites that are a five-to-10-minute drive from a downtown such as St. Petersburg in Florida. Pittro says outlying suburban areas where there’s been little supply of rental housing and residents can gain outdoor space have been a focus of the Chicago developer her company has worked with on Deercrest, which will gain more inventory in future stages. The same developer has also broken ground for the Conservancy in Gilberts, Ill., and next year will start on the Clublands of Antioch in Antioch, Ill., and Bristol Farms in Yorkville, Ill. “The land in these locations is cheaper,” she says.
Others also hear interest in sites farther out—30 minutes or so from a city—for another reason. Municipalities there are likely to approve the required density to accommodate enough houses to create a community, Chacon says. “We’re seeing BTR communities pop up in [Georgia] locations like Cartersville, Gainesville, Winder, Douglasville, etc. because the primary pockets like Marietta, Sandy Springs, Brookhaven and others are harder to get deals approved,” he says.
Barbara Ballinger is a frequent contributor to units Magazine.
Read the full BTR feature in the January/February 2023 issue of units Magazine.