SPECIAL REPORT: The New Apartment Development Cycle Targets Generation Y
By Keat Foong, Executive Editor
New York—The new apartment development cycle focuses on the needs and wants of a huge demographic group that is now entering prime renter age—Generation Y, said Rohit Anand, principal of KTGY Architecture+Planning. Anand was the keynote speaker at MHN’s 2012 Excellence Awards ceremony held this week in New York. The event was sponsored by Interface and Carnegie, two founding members of the commercial green building movement.
Multifamily developments targeting Gen Y are located in urban areas and cater to the generation’s greater sociability, sense of style and desire to live in 24-hour work-play-live cities. Anand, whose firm has designed for some of the top multifamily developers, including UDR, Bozutto and AvalonBay, cites as example AvalonBays’ line of “AVA” apartments which are aimed specifically at Gen Y in their design, branding and marketing.
The Gen Y demographic group, 80 million strong, is larger in size than the baby boomers, and they are also known to be the generation that is delaying traditional life events such as marriage, having children and/or homeownership. Studies from J. Turner Research show that location is by far the most important consideration for this demographic when selecting an apartment, said Anand.
The apartment community should ideally be located no more than 20 minutes to work or entertainment for these residents. Urban sites that have seen multifamily development more quickly are ones that are based on or near transit lines, added Anand. And the projects tend to be mixed-use, incorporating preferably a grocery store. Equity and debt financing, as well as technology company headquarters, also tend to be attracted to these sites, he noted.
Other top amenities that are most desired by Gen Y include: parking, which is “still very important,” according to Anand; fitness centers, which rank “very, very high”; and pool and yoga amenities, which rank higher for Gen Y than for other groups. In designing project amenities, the apartment industry appears to be learning from the hospitality industry, noted Anand. ”This is a social generation,” he said, and besides the space in their apartments, Gen Y residents need second and third gathering spaces—the second being the amenities area, and the third being the city itself.
Some of the latest trends in the layout of common areas involve mixing uses and removing walls previously separating the various areas, said Anand. For example, the bar, lounge and fireplace may now all be located in one area, separated only by furnishings or furniture. The leasing area may be mixed into the general amenity areas during busy evening hours. Business centers may be open, and even the theater may no longer be enclosed. Instead, it may have a barn door that can closed if needed.
The plentiful use of glass to achieve a look of transparency in the common areas is another popular trend borrowed from the hospitality industry, said Anand. Outside spaces, involving the use of outdoor fireplaces and fire pits, are also becoming more important, even in cold regions. Fitness areas that provide spaces for yoga or pilates—that may be rented out or used by instructors—are also seen as being very popular, said Anand. Dog and cat wash areas, garden plots and bike repair shops are other new amenities now being offered. “People are very serious about their bikes” today, said Anand.
Generally, four to five story woodframe construction seems to be the product of choice among developers for these urban infill developments, he added. Densities have been increasing in the latest development cycle. Whereas woodframe podiums in the previous development cycle may have had densities of 150 units per acre, Anand said there are many projects in the current cycle that achieve densities of as much as 200 units per acre with the same product type. The new projects are incorporating two levels in the podium and five levels above, for a total of seven woodframe levels.
As densities increase, apartment sizes are also becoming smaller. Anand said that the net average square feet may be falling from 800 square feet to 702 square feet. In the suburbs, he noted, they have also declined, from 1,100 square feet to 950 square feet.