PERSPECTIVE: Designing Multifamily to Withstand a Fluid Economy

By Randolph Gerner, AIA, GKV ArchitectsAs the multifamily market continues to soften, developers and architects alike are trying to find unique ways to not merely survive but thrive through flexible design. A handful of developers actually had the foresight to see that the real estate bubble was about to burst

By Randolph Gerner, AIA, GKV ArchitectsAs the multifamily market continues to soften, developers and architects alike are trying to find unique ways to not merely survive but thrive through flexible design. A handful of developers actually had the foresight to see that the real estate bubble was about to burst and began proactively planning for the inevitable current downturn cycle. Some began an arduous rezoning plan or identified underdeveloped sites, while others worked towards creating projects with an inherent flexibility to navigate the present-day fluid marketplace. The conversion trend is a result of the lackluster luxury multifamily market that gives developers the ability to bring a project online in the current economic environment and generate revenue without risking sluggish sales. The key factor for a building to be able to convert from rental to condominium lies in the infrastructure and incorporating hospitality-like amenities.The initial outlay is offset by the ability to bring a project on line in down economic cycle and still command high rents, making the property extremely profitable in a time when most developers are pulling back. The luxury and hospitality infrastructure positions a rental building to be targeted to individuals with large disposable income base and may be interested in purchasing a home as real estate market becomes more robust. Heating and cooling comprise the lifelineAlthough not sexy, the HVAC system of a building is the lifeline that keeps residents comfortable throughout the year and requires significant thought and investment. The most common HVAC system in a rental multifamily is through-the-wall heating and cooling systems called Package Terminal Air Conditioners (PTAC).The advantage of this system is that it is initially a low-cost outlay and it can be replaced at a later date with little or no disruption to the facade. Advances are continually being made to these systems and the building A/C can continually be upgraded over the life of the building. Though this is not the “typical” HVAC solution for Manhattan condominiums, their use is becoming commonplace. Communication systemsOne of the major differences between a rental multifamily project and condominium lies in the communication and security systems offered. Typically rental buildings are equipped with basic communications systems that can double as security systems and allow entry to the building via virtual doorman. All other types of wiring except for basic cable television are usually left to the individual to decide. This allows individual renters to customize their communication needs and saves the building owner upfront costs of installing high-speed wiring. The down side to this is that if, as a building owner, you are looking to the future, condo buyers and high-end renters have raised expectations and want a fully integrated communication system that is move-in ready. There are a variety of options available to developers when wiring a multifamily residence ranging from high-speed cable and Fios to pre-wired for WiFi anywhere in the building to instant access to concierges where a resident can request flower delivery or dinner reservations. Although wiring is an integral part of a building’s infrastructure, it can be a value-added amenity that can translate into future revenue.Individual unit designThere is a greater focus on the living room and kitchens in for-sale properties than those in rental multifamily developments. The spaces are typically larger and have unique characteristics that are specific or signature to the design of the condominium. The actual size of a rental apartment is, by standard, generally smaller than a condo due to the targeted demographic.In condos, kitchens and baths tend to be the crowning jewels of the space, and add bragging rights for high-end finishes and fixtures. Stainless steel appliances are no longer luxury, but considered commonplace with the newest trend focus on seamless cabinetry and appliances that blend into a space. Unique countertop materials in manmade and natural stone are upping the ante and are creating a showplace around which the entire residence is focused. At GKV we are incorporating specialty apartments, which are 25% to 30% larger than the rest of the units into high-end rentals. This is something that in the past would have been reserved for luxury developments that were targeting high net worth individuals to evoke a perception of exclusivity.In New York City, the competition will heat up as new luxury rental buildings with specialty floors featuring distinctive homes that are as large as 2,500 sq. ft. with large master suites with walk-in-closets and spa-like bathrooms.Designing the facadeDue to the nature of the sales market, condominiums are designed with a distinctive exterior so that the buyer is instantly attracted to the building before stepping foot in the door. The design is a crucial factor in the marketing and creation of a romantic or emotional appeal to a buyer—especially in pre-sales where the building has yet to break ground. The design sets the tone of the building and can even dictate the targeted buyer: high net worth 30-somethings, young families or wealthy empty nesters. On the other hand, rental buildings are usually less concerned with high-end design appeal but rather with optimizing the square foot value. When designing for purchase buildings, architects strive to maximize the amount of natural light let into a space as well as the general feeling of airiness. Floor-to-ceiling window walls ‘enlarge’ a space but at the same time require a higher level of design than punched windows typically found in rental units. Amenities take a cue from hospitality marketIn the multifamily condo market, luxury rules and amenities sell the property by providing unique living experiences that are taking a cue from the hospitality market. The latest trend has evolved into creating destination or club-like environments to provide maximum convenience so residents never have to leave the building.Developers can justify the hefty price tag associated with these homes if the buyer no longer has to maintain a gym or club membership. These amenities range from expanded state-of-the-art exercise facilities that go beyond treadmills and exercise bikes to include yoga studios, steam rooms and saunas.Resident-only lounges are competing with local nightlife as they provide a chic environment with happy hours, billiards and designed to resemble hotel lobby bars where residents can mix and mingle. Even entertaining at home can be taken to the next level when the building features private dining rooms equipped with a service kitchen, providing the perfect solution for hosting a large group in an urban multifamily home.Buyers are also enticed by such personal services as concierge or lifestyle enrichments. Outdoors space is placed at a premium in urban environments so “al fresco” takes on a whole new meaning with landscaped rooftop terraces or resort-like poolside lounging. Incorporating outdoor space into design requires a higher level of engineering and construction that takes into consideration drainage issues, landscaping materials and access to water.The renter or potential buyer response to the “wow” factor can outweigh the technical and cost considerations. Topping the list of high-end amities are rooftop pools, infinity lawns and fireplace nooks.Many of these amenities are focused on leisure time, but as the workplace has become more mobile developers are responding. High-tech business centers that are styled after in-house Kinko’s as well as formal conference rooms are offered to residents who work from home but may need administrative assistance or wish to host an on-site meeting. Condo lobbies are dramatic spaces that establish the “fantasy” lifestyle created by the developer and architects. Lush materials and dramatic lighting welcome buyers and visitors and are key elements in the tangible lifestyle offered. These spaces are often larger than rental lobbies and serve as a social gathering space rather than sim
ply functional spaces to receive packages or other day-to-day activities.It is our experience that the line that distinguishes condominium from rental properties is blurring more with each passing day. (Randolph Gerner, AIA, is a principal at Gerner Kronick + Valcarcel, Architects, PC in New York)