Generation Y values amenities over square footage
Generation Y, those of us between the ages of 20 to 34, are playing a large role in the multifamily market and reshaping how it will look moving forward.
“Clearly Gen-Y is having a huge impact on the real estate community. What’s really significant is that real estate developers and the whole community are studying demographics and incorporating it in strategic plans. We didn’t have much of this in the past,” Stan Ross, Chairman of the Board of the University of Southern California’s Lusk Center for Real Estate, told HousingWire. “The key thing here is that they’re using it in an analytical way to build their plans as to where and what they develop.”
This generation graduated college and was immediately thrown in a struggling economy with very few jobs. Because of this, many in this group either were forced to move home or live with multiple roommates in order to afford their housing.
Ross says that many in Gen-Y are often surprised when they find out how much a mortgage costs and what an adequate down payment is in order to buy a home.
Analysts at the Lusk Center say that once this group does move into their own place, which is typically a rental at first, the biggest appeal are affordability, on-site amenities, nearby retail and restaurants. Greater square-footage now gives way to easy transit for this generation. “As a developer doing my strategies, I’ve got to really reevaluate the location,” Ross said.
One developer, AMF Development, is taking this into consideration with its first in a series of complexes that caters directly to Gen-Y. Elevé Skydeck & Loft, which will be located in Glendale, Calif., will be a 208-unit multifamily complex expected to open in the early spring of 2013.
“This concept is designed specifically to appeal to young professionals who would rather live in a smaller, yet well designed apartment set in a vibrant, hip and social community,” said Alan Dibartolomeo, chief development officer of AMFD. “Given the pent up demand for this type of housing in Glendale as well as many other urban areas, the timing is right.”
AMF Development, who holds 22 years of history building large multifamily projects, decided to develop this complex based partly on a research project completed for AMFD by The Futures Company. The project revealed that 62% of respondents would prefer to live in a smaller living space alone, than in a larger space with a roommate, even if that meant spending more money.
Elevé will be located within a quarter-mile of more urban amenities than any comparable project outside of New York City, said Greg Parker, CEO of the development company.
“There are 108 restaurants, 161 clothing and accessory stores-- both local and national chains, the main public library, 12 churches and two weekly farmers markets all within walking distance,” Parker said.
Those looking to rent in this complex will need to be willing to give up apartment space in lieu of amenities. The Elevé apartments themselves are space efficient, coming in under 400 square feet. This includes a full kitchen, bath, living room and bedroom.
“They’re able to spend less of their total income on the unit and still be in an urban area where they prefer to be,” Dibartolomeo said of potential renters.
Dibartolomeo added that socialization on-site is important to AMF, so a 26,000-square-foot roof level deck called the “Sky Deck” will be included in the development. This space will be designed with semi-private cabanas, a media center, grills, fire pits and a separate deck with hot and cold spas and a fenced dog park.