It doesn’t get much better in the Pacific Northwest than it does in the summertime. Sunshine, NO RAIN, and near-perfect temperatures. But is this truly the case?
Days are long, and when the sun is out it’s burning brighter and hotter which is having an effect on apartment leasing. And not a good one!
On-site property management teams have revealed that A/C is a feature that is frequently asked about in apartment homes. And properties that don’t have it are losing residents by not offering this amenity. Although A/C was never considered a necessity for Seattle residents in the past, today’s market is beginning to say otherwise, and developers of new apartment projects are beginning to listen.
If you are developing a new apartment building or repositioning an existing one, creating a comfortable at-home experience is key to attracting (and keeping) your residents.
Here are a few things to think about when contemplating whether A/C is worth it:
1. Seattle is heating up!
And it’s not just the city’s booming growth and development.
Average temperatures have increased over the years, and it’s only getting warmer. Here are some examples of recent climate trends the Seattle area has experienced:
Seattle's temperature average in July 2014 rose 3.5 degrees above normal.
Average temperatures spiked significantly above normal in June 2016, with increased averages of 4-9 degrees.
May through September of 2017 was a consecutive period where Washington experienced higher than average temperatures statewide.
Daily and mean temperature records were broken throughout August 2017, with multiple Seattle highs in the 90s.
This March 2018 had a record-breaking day of 70 degrees.
August 2017 was reported to be the hottest August on record. As shown in the graphic below, the state was blanketed with above normal and record-breaking mean temperatures.
2. Heat’s Not The Only Thing On The Rise
There’s a rising demand from local and out-of-state renters to stay cool.
Seattleites are beginning to consider A/C simply because they’re not used to the hot weather. In addition, more and more renters are coming from out-of-state. With the area’s top employers constantly recruiting talent, individuals from California, Texas, and the Midwest (for example) are flowing into the city. Upwards of 60% of residents in most apartment communities are from out-of-state and to them having an air-conditioned unit is simply an expected part of their home experience.
3. “The Struggle Is Real” said your Leasing Team
Picture this: Your brand new apartment building is in lease-up, in what you assume is the most ideal month of the year – August. The building is thoughtfully designed, expertly run by your A-team of leasing agents and maintenance professionals, and Mt Rainer is out in all its beauty. Now it’s time to tour!
As your leasing team walks each prospective resident through a 30-minute tour of the building showing off all of its amazing amenities (and that view from the rooftop deck!) it’s time to take them to the model unit and give them a glimpse of what coming home will feel like. The resident is so excited! They LOVE the property, they love the team and services, and they can’t wait to open the front door.
It opens….and what is the first thing they’re met with? A huge burst of HOT AIR! The units are sweltering. And guess what - that tour is over.
Time and time again we hear this story (and frustration) from on-site leasing teams. Regardless of a project’s unique amenities and features, a hot and uncomfortable unit is the kiss of death. Your lease-up is suffering. Call in the concessions.
4. A/C Systems: Cost -vs- Value
There are several cool air options in the apartment market today; choosing the right system depends on the level of luxury experience you are providing your resident and the costs will vary. The cream of the crop is central A/C, while a more affordable but still conventional option that is gaining popularity is A/C ports with portable A/C units (PS… those units can be rented for additional property income!) Another option that’s gaining traction in this market is the VRF system, which falls in between.
The benefits and value of this amenity can be quite staggering. Not only do projects with A/C carry a rent premium, but they also see quicker leasing velocity and less turnover when compared to properties that do not offer this home amenity. Also, providing A/C is a strong marketing tool and asset differentiator. And finally, NOW imagine what that leasing experience is when the front door opens to that beautiful, and cool-comfortable, model unit. The perfect end to a great tour – where do I sign?!
In Summary
The resident experience and thoughtful place-making are key to creating a truly successful project. Those home and amenity details are critical, not only when you’re building opens but for its future success as well.
So don’t forget the A/C, and give us a call if you need help deciding what’s best for your project. We love helping our clients create amazing residential experiences.
High Five, Everybody!
Arrive, LLC is a residential development consulting company focused on ground-up development and asset repositioning.
Our goal for our clients is increased return on investment. Our passion is the resident experience. And our value is ensuring each new project that comes to market meets and exceeds the expectations of both.