As a multifamily developer, property owner, architect, or builder, you’ve got tough decisions to make regarding the choice of amenities for your apartment and condominium communities. Our 2019 Amenities Survey measured 113 such choices, but there are many more—everything from countertops, kitchen and bath fixtures, and lighting styles, to furnishings, cabinets, and window treatments.
The choices are endless, and new ones springing up every year—new offerings like co-working and maker spaces, biometric security systems, 5G networks. What amenities are “must-have” rather than “nice to have” for the local market? Which amenities will attract the renters or buyers you’re targeting? Will your amenities help you get the top lease rate or purchase price for your property? Will they help you fill the building faster? Does your amenities package fit your firm’s image—your all-important brand?
The self-questioning shouldn’t end once the property is occupied. Are your customers actually using the amenities you so thoughtfully provided? You have to check to see what’s working, what was a total bust. Did that saltwater pool turn into a boondoggle? Should you have budgeted for an indoor basketball/volleyball court, as your biggest competitor did? Mistakes can be costly, not just in upfront design and construction dollars but also in opportunity costs. Every wrong choice represents a lost opportunity to provide other amenities with potentially greater customer appeal.
Which brings me to the $30K cup of coffee. Specifically, $30,000 a year, the cost of providing free coffee to your tenants in a decent-size apartment building, according to Peter Chmielewski, City President–Chicago, Lennar Multifamily Communities (at the Marcus & Millichap Chicago Multifamily Forum last April).
No wonder developers, owners, and their project teams are looking for ways to “monetize” amenities. Want a glass of pineapple juice, Ms. Tenant? That’ll be $3 at the juice bar, just charge it to your unit. That’s one way owners and developers are turning a $30,000 annual operating cost into new revenues.
“Monetized Amenities”—the next frontier in the Amenities Saga.