The future of the multifamily market will include disruption, advances in technology, and engineering challenges related to the ongoing labor shortage, industry observers said at the International Builders' Show (IBS) in Las Vegas last week.
“We used to be really great with hammers and nails. Now, we have buildings with brains,” said Jennifer Nevitt of Forty-Two LLC, a multifamily property management, development, and consulting firm based in Plymouth Meeting, Pa. “Our buildings have become so high-tech, we don’t have a labor force that can deal with that.”
Nevitt’s presentation at IBS focused on a wide variety of trends that are already influencing the industry, with more change predicted in the future. She acknowledged that the labor shortage is affecting not only the construction of multifamily buildings but also their operation, and she recommends tapping graduates from local colleges or trade schools that offer construction management on the curriculum. She also predicted that increasingly severe weather will continue to create havoc in the construction business and that the threat of tariffs has resulted in raising the level of contingency funds in a budget.
Nevitt likes using monitoring technology to help manage buildings, such as Leak Gopher, by Franklin, Tenn.–based Leak Intelligence, which can detect a leak in a building and turn the water off automatically, or devices from Lebanon, N.H.–based FreshAir Sensor, which can detect unauthorized smoking in a building, including of tobacco and marijuana. “It’s the only way to police,” she said. "Otherwise, we'd have to hire a full-time employee just to handle lease violations.”
To cut down on labor costs, Nevitt recommends paying attention to innovations like accessible pick-up zones for car-sharing services, backup electricity systems in case of an outage, and augmented-reality devices to show prospects apartments. “We figure it’s a 40-minute labor cycle to physically show somebody an apartment, and 70% don’t buy on the first visit, which leads to another 40-minute labor cycle,” she said.
Nevitt also points to digital detox spaces—tech-free zones inside a building that are dedicated to a phone-free experience, and coffee shops that can transform into a sushi bar in the evening via movable walls. Mirrors in the near future will be internet-enabled so that residents can practice their yoga poses, and closets will be so smart they'll help a tenant match outfits. She envisions vertical farming coming to high-rise buildings, especially product that features oversized patios.
Mail and package rooms are getting hipper and putting more onus on renters to retrieve their own goodies, and Nevitt likes Amazon’s locker service as another way to dial back labor costs. “Amazon will install lockers for free,” she said. “Our leasing agents were spending all their time delivering packages; we’re getting 100 packages a week for 350-unit buildings.”
Statement flooring appears to be another trend, along with circadian lighting systems. In upscale buildings, private panic rooms are popular, along with refrigerators that tell you when the food has expired. In the bath, showers with seats are desirable and sinks should be single basin and 14 to 16 inches deep. High-quality faucets are a must. Gas fireplaces are now a good idea, along with appliances that reveal when they're about to fail.
Of course, the lifeline connecting all these bells and whistles in terms of bandwidth can't be ignored. “We’re now connecting units with 1 gig of fiber per home, when it used to be 1 gig for the whole property,” said Nevitt. “We offer 30% of that speed for $69 and they pay extra by volume for the gigs used, so we don’t turn it on for everybody.”
Nevitt also likes to imagine that, one day, owners and operators will be able to use an app to rate their renters, but, so far, that is still a ways off.