By: Claudia Pascual, Multifamily Advisory Group
Cushman & Wakefield’s Vice Chair, Marc Robinson of the Southeast Multifamily Advisory Group, moderated a diverse panel of developers, owners and architects at the annual InterFace Carolinas conference May 31. The panel covered the outlook on multifamily investment and development in the Carolinas.
There were three main takeaways – favorable metrics make it clear that investing in multifamily is a great investment option; developers must think outside the box to offset rising construction costs; and there is an ongoing “amenities war” amongst properties to differentiate themselves in a competitive marketplace.
With positive combined job and population growth in the Carolinas, these metrics created a favorable multifamily investment market, and there is a new wave of investors who traditionally did not include multifamily in their investment portfolios. However, Rohit Anand, Principal of KTGHY Architecture and Planning, pointed out that there has been a “6-to-12% construction cost increase across the country and you can’t cover that with rent increases.” Labor costs are not coming down, meaning this is the new normal.
Developers are turning their attention outwards from the unit interiors and focusing on shared community amenities. In today’s market, the panel advocated towards more thoughtfulness when considering amenities – instead of focusing on what your competitor down the street is doing, think about your target market and what your renters needs are. Would a co-working space help or a live-work unit? What about an open, flexible space or a café?
There is also a growing implementation of smart units. Donald Santos, Managing Director of Alliance Residential Company, added, “We have a team that curates tech packages across the platform across the country.” They are focused on creating various tranches of smart home packages from Bluetooth speakers and cameras to high-tech doorbells.
With favorable investment conditions, plenty of product to work with and ever evolving new technology, those in multifamily have a lot of options to diversify their portfolio offerings dependent on their markets and renter profile to leverage their investments. There is a whole new wave of capital and investor appetites are shifting and are more are open to multifamily and less sensitive to risks.
Claudia Pascual joined the Cushman & Wakefield Multifamily Advisory Group as Office Manager of the Charlotte office when C&W acquired Multi Housing Advisors (MHA) in 2016. Claudia has a diverse role assisting in the day-to-day operations as well as marketing and research for her team for the past five years in addition to having worked in Multifamily property management for seven years.