Lifting the Amenities Lockdown: What Are Today’s Must-Haves?

Work from home is expected to be a lasting trend, and that is informing a number of choices around the amenities a building may offer.

Amenities have always been seen as selling points for multifamily properties, providing incentives for residents to sign a lease or stay on for another year. From fitness centers and golf simulators to pet parks and movie theaters, these spaces provide opportunities for residents to interact with one another and to feel like they are getting the most for their money.

When the coronavirus pandemic hit hard in March 2020, however, many amenity spaces were quickly shut down while capacity and operating hours were curtailed at other spaces.

Over the past year, property owners and managers have had to work diligently to repurpose, reposition and revolutionize how these spaces can be used in order to keep residents interested and satisfied.

“It really comes down to convenience and flexibility,” said Frank Roessler, founder & CEO of Ashcroft Capital. “Home isn’t just a place to lay your head down at night anymore. Residents are even more focused on comfort, space and amenity packages.”

According to a survey from the Stanford Institute for Economic Policy Research, 42 percent of the U.S. labor force is now working from home full time. Additionally, the share of working days spent at home is expected to increase fourfold from pre-COVID-19 levels—from 5 percent to 20 percent. With this, amenities have become even more important, providing a much needed escape for residents from the confines of their own homes. So with the vast amount of available options, what are the wisest investments that owners and operators can make?

BALANCING ACT

Although the coronavirus will be behind us someday, that doesn’t mean residents will be flocking back to the office full-time. Therefore, there is an increasing need for remote work amenities, particularly those that promote a better work-life balance. Further, amenities are now being adapted to more individualized use, ranging from scheduling formerly shared spaces to making Wi-Fi more readily available throughout the community to support higher bandwidth.

According to a resident survey conducted by SatisFacts, some of the top amenities residents claimed would assist them in working from home were faster internet speeds; wireless self-service printing, copying and scanning; outdoor working spaces; individual work pods; coworking spaces; and video chat booths.

These technology upgrades would help mitigate some of the challenges the surveyed remote workers are currently facing, including balancing the work-life schedule (36.6 percent), finding a dedicated workspace (35.9 percent) and being able to focus (33.1 percent).

Once the pandemic is over, working from home is still expected to be the favored choice amongst many workers, and, in order to keep themselves feeling productive, proper workspaces are necessary.

“The pandemic has further evolved that transformation as working from home has become the norm for more residents,” said Beth Tuttle, vice president of marketing at LMC. “Large coworking spaces have now been partitioned into smaller spaces to allow for more physical distance between residents.”

Another amenity that is highly sought after is green space such as playgrounds, pet parks or access to nearby walking or biking trails. Playgrounds and green spaces were amenities the industry as a whole had dramatically leaned away from, Roessler noted, but that is expected to change as restrictions are eased and new work-from-home routines are established.

“These spaces offer an additional place for kids to expend energy while their parents work remotely,” he said.

Having access to green space on a property’s premises will be an important alternative for people who want to enjoy the outdoors but want to avoid more public recreation spaces. Outdoor lounge and grilling areas, for example, have always been attractive to residents but maybe were not used as often.

“Before the pandemic, residents could have stopped at a local bar or restaurant for happy hour with friends,” said Tuttle. “Today, they are holding virtual happy hours in outdoor lounges instead. These spaces provide a sense of normalcy while also offering a change of pace someone may need to help unwind from the new at-home workday.”

According to the National Multifamily Housing Council and Kingsley Associates 2020 Apartment Resident Preferences Report, more than one-third of residents surveyed were pet owners. Dog owners specifically even said they expected to pay between $28 to $34 more per feature per month for amenities catering to their animals, including pet-washing stations and on-site services, like dog walking or dog sitting.

Although fitness centers were one of the first amenities to be halted at most properties, they are actually still a top want from renters. The pandemic has placed a higher emphasis on health and wellness, prompting residents to take advantage of the fitness options provided to them once they are reopened.

TECH ON TOP

Technology is playing a big role in how amenities spaces are being repurposed and used by residents. Innovations that are becoming more commonplace include: facial recognition software, room sensors and smart home access controls, like touchless elevators and Bluetooth-enabled doors. When it comes to marketing to potential residents, self-guided and virtual tours are the most convenient option to increase lease-ups. For resident retention and safety, air filtration and electrostatic spraying features are easy upgrades that can be added to a community for higher sanitation needs.

“Having the proper mechanical, filtration and HVAC strategies matter,” said Jeffrey Schoeneck, executive director of Cuningham’s Live. “It’s going back to basics in terms of thinking of design and preventing some of the higher risks with a low-cost solution. Regenerative design is improving the situation in front of us … incorporating biophilia, stronger access to daylight, better LED and blue lights; all these factors boost health and a better lifestyle.”

With these transformations, buildings will become more behaviorally healthy for residents, while still allowing for places where people can connect passively and actively.

MOVING FORWARD

Although it is impossible to know when the next challenge might arise, it’s important to have a plan in place to keep owners and operators flexible. “Having a generic business continuity plan for any kind of event that might limit access to office spaces or exposure to customers, forces us to think through how we can continually adjust our strategies and look towards more digital solutions,” said Jenny Schoellhorn, director of learning and development at Birchstone Residential.

While the past year has been difficult, it has also been a great opportunity for multifamily operators to demonstrate how they can listen to residents and health experts and respond accordingly.

“Yes, this will pass, but something else will always come in its place,” said Schoeneck. “We need to capture those moments and translate them into design. Look at healthy buildings. Don’t lose sight of needs that are fundamentally healthy and focus on the end user and what will be the experience for them physically and mentally.”

Read the March 2021 issue of MHN.

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Ashcroft Capital Expands Jacksonville Footprint

The company purchased Elliot Baymeadows in Jacksonville’s Royal Lakes neighborhood.

Ashcroft Capital has acquired Elliot Baymeadows in Jacksonville, Fla., marking the second acquisition through its Value Add Fund.

The company acquired the 352-unit community from an undisclosed seller and will put its in-house property management company, Birchstone Residential, in charge of managing the community.

Formerly known as Green Tree Place, Elliot Baymeadows offers one- and two-bedroom units that range in size from 550 to 1,100 square feet. The community’s amenities include a fitness center, courtyard, playground, pond, two tennis courts, swimming pools, bike storage, package delivery service, and picnic and grilling areas. The community is 96 percent occupied, according to Ashcroft Capital.

As the community was built in 1986, Ashcroft Capital will be conducting a series of interior and exterior renovations to Elliot Baymeadows. The units will be upgraded with quartz countertops, stainless steel appliances, new light and plumbing fixtures, among other additions.

Ashcroft Capital will also refurbish the community’s clubhouse and fitness facilities, repaint the property’s exterior, convert the tennis courts into sports courts and install a package locker system.

JACKSONVILLE’S STRONG FUNDAMENTALS

For Ashcroft Capital, Elliot Baymeadows was the second acquisition for its $150 million Value Add Fund, which focuses on growth markets in the southeastern U.S. The company’s first acquisition through the fund was its entry into the metro Atlanta market last month with the acquisition of the 412-unit Halston Riverside. Prior to the creation of its Value Add Fund, Ashcroft Capital also acquired Southside Villas, a community that offers one-, two- and three-bedroom units near Jacksonville’s downtown.

“We’re big believers in the Jacksonville metro for several reasons and absolutely intend to acquire more communities in this market,” Frank Roessler, founder & CEO of Ashcroft Capital, told Multi-Housing News. ”We always strive to invest in cities with heavy population growth from in-migration and that definitely describes Jacksonville.”

Roessler also told MHN that Jacksonville had a strong and diverse economy, including a strong financial and business sector, a rapidly growing healthcare industry and one of the largest trade ports in the country.

With the latest acquisition, Ashcroft Capital’s portfolio now totals more than 10,000 units in Jacksonville, Tampa and Orlando in Florida and the Dallas-Fort Worth area in Texas. The company is also looking to expand its Atlanta area portfolio as well as enter the Phoenix, Charlotte and Raleigh-Durham, N.C., markets.

Ashcroft Capital Expands Into the Metro Atlanta Market

The investment firm has acquired a 412-unit garden-style apartment community.

Ashcroft Capital has entered the Atlanta market with the acquisition of the 412-unit Halston Riverside, formerly the Retreat at Riverside, in Lawrenceville, Georgia.

The garden-style community is the first property purchased through Ashcroft Capital’s new $150 million value-add fund, which aims to acquire five to seven assets in targeted markets. It is expanding its geographic footprint by pursuing acquisition opportunities in Atlanta; Charlotte and Raleigh-Durham, North Carolina; and Phoenix. Since its inception, the fully integrated multifamily investment firm has acquired more than 10,000 units in Dallas-Fort Worth as well as Jacksonville, Orlando, and Tampa, Florida.

Frank Roessler, founder and CEO, said the firm plans to rapidly establish a large footprint of 5,000 units or more in Atlanta in order “to achieve economies of scale, market leverage, and recruitment strength.”

Birchstone Residential, Ashcroft Capital’s in-house property management company, has assumed management of Halston Riverside, which features one- and two-bedroom apartments. The property is located about 30 miles northeast of downtown Atlanta and offers residents close proximity to schools, restaurants, entertainment, and outdoor activities. Community amenities include package lockers, controlled gate entry, four resort-style pools, a playground, grills with picnic areas, a state-of-the-art fitness center, and a new cyber lounge.

“Halston Riverside represents the type of excellent value-add opportunity that our fund is targeting,” said Roessler. “It has a history of institutional ownership, and the property has been very well maintained. At the same time, we have identified ways to add significant value through rebranding and renovations. In addition, Lawrenceville continues to show a strong resilience to the economic effects brought upon by the pandemic.”

In-unit renovations will include new quartz countertops, undermount sinks, stainless steel appliances, tile backsplashes, and vinyl plank flooring. Amenity improvements to the clubhouse, dog park, and tennis courts also are planned.

“The renovations will help an already outstanding community stand out even more against the competition,” said David Deitz, president of Birchstone. “We also believe that our tech-forward supportive culture and dedication to best-in-class customer services will play a critical role in driving performance. At Halston Riverside and throughout the Ashcroft portfolio, this will result in communities that provide exceptional experiences to our prospects and residents and, in turn, maximize revenue and net operating income.”

Ashcroft Capital Snags Atlanta-Area Apartments

The garden-style community in Lawrenceville will undergo unit and amenity renovations.

Ashcroft Capital has acquired Halston Riverside, a garden-style apartment community in the Atlanta suburb of Lawrenceville, Ga.

Formerly Retreat at Riverside, the property at 1000 Duluth Hwy. will be managed by Birchstone Residential, the in-house property management company of Ashcroft Capital.

The community features 412 one- and two-bedroom apartments, with some offering 9-foot ceilings, garden tubs and ceiling fans, and select residences providing vaulted ceilings and built-in bookshelves with computer desks for those who work at home. Four swimming pools with waterfalls top the list of common-area amenities.

Last month, Ashcroft Capital’s CEO commented on todays’ must-have amenities.

SMALL CHALLENGE

“One small challenge stemmed from the fact that since it was our first acquisition in this market, we initially had limited boots on the ground, but we were able to capitalize on the outstanding expertise of several local consultants with whom we have longstanding relationships,” Scott Lebenhart, Ashcroft Capital director of acquisitions, told Multi-Housing News.

“Over the course of the transaction, we were able to build out a fully localized team. But that initial reliance on those local consultants was imperative, and we’re extremely grateful for it,” he added. 

Ashcroft Capital employs a strategy of acquiring value-add properties in high-growth markets, and intends on embarking on value-add renovations at Halston Riverside. In-unit upgrades will include installation of quartz countertops, undermount sinks, stainless steel appliances, tile backsplashes, vinyl plank flooring and new cabinet fronts. Clubhouse, dog park and tennis court improvements will also be undertaken.

Halston Riverside’s location near I-85 and Highway 316 helps make both Atlanta and Athens, home of the University of Georgia, very accessible.

The Benefits of Vertical Integration

If you were to ask my take on vertical integration in an apartment company, in a nutshell my response would be something like this: “If done correctly, the benefits are enormous. But you have to do it for the right reasons. Otherwise, it’s easy to mess it up.”

Over the years, I’ve seen too many apartment owners create their own property management and construction divisions for the wrong reasons. Maybe they simply want to be able to tout their vertical integration to help them raise big money. Or perhaps they’re just focused on maximizing the revenue streams these entities may create. 

If you’re an owner with these motivations, I’d strongly recommend against launching an in-house property management and/or construction company. The chances are, things will go wrong before they go right. 

But if your focus is on building in-house divisions with the proper expertise and experience in place to optimize the performance of your own portfolio, then you and your investors can reap significant benefits from vertical integration. 

For starters, when you have your own property management team running your apartment communities, they’re bound to be extra motivated to do all they can to boost property performance and the bottom line. Plenty of third-party managers out there do great work – I’m not saying they don’t – but a fee manager’s compensation structure might not necessarily result in them doing everything they can to maximize a property’s revenue and performance. Stated another way, you’re (hopefully) going to look after your own children better than anyone else. 

Self-managing also can pave the way for an efficient, more streamlined decision-making process about operations at a community. When market conditions change, onsite strategies and tactics can be adjusted quickly when ownership and management are one and the same. On the flip side, when a third party is running a community, communications between owner and manager can be unwieldy and the decision-making decidedly inefficient. 

On the construction front, having an in-house division can save an owner a significant amount of money. First off, you’re no longer paying the general contractor fee, which often comes to about 20% of the total construction cost.

Furthermore, when you have your own construction entity, you can buy your construction supplies in bulk from overseas, store them in warehouses that you own and use them as needed. That’s another way to save money and, especially in a time when construction costs are so high, saving that fraction of a dollar on everything can be so important. 

Also, having your own in-house division makes the actual building and renovation processes much more efficient. When the construction team is on your payroll, they’re around to do the renovations on one property, and when that one’s done, they’re going to be ready for the next renovation.

Conversely, when you don’t have it in-house, every time you want to put on a new roof or renovate a clubhouse, you’ve got to collect multiple bids and make sure they’re all apples to apples. You’ve got to make a painstaking decision and hope you get it right. 

To be sure, having your own property management and construction divisions can bring higher workers’ compensation costs and subject you to more liability. Those are not considerations to dismiss quickly.

But if an apartment owner is careful and deliberate in creating in-house property management and construction teams, its portfolio and its investors can benefit significantly.