“Technology is a key element of modern luxury multifamily developments, increasing convenience, security and overall tenant satisfaction,” said Bainbridge Companies’ Solander. Gail Ruggles, Bainbridge’s executive vice president of operations, said luxury tenants view apartments and condos as “sanctuaries,” with controlled access, high-speed internet and smart home features “at the top of the list.” He added that there is. Ability to request services, pay rent, and communicate with on-site staff.
Each Toll Brothers luxury apartment is equipped with technology such as keyless entry and smart thermostats. Automated features like mechanical blinds are becoming more common in luxury apartments. Sources also emphasized the importance of a strong Wi-Fi signal throughout the luxury building.
PTM Partners’ Panturiano said tenants at 2000 Biscayne can access the building’s amenities and stay in touch with building management by downloading the Livly app.
Layton Construction’s Geier notes that luxury apartment complexes need to enhance their technology strategies to attract younger tenants, who are their primary target for renters and buyers. “High technology integration is a must,” he says. Niles-Bolton borough has also found a preference for smart home systems that allow residents to control lighting, heating and security from their smartphones. Demand for smart appliances such as touchscreen refrigerators is also increasing.
Technology also includes the performance of building machinery. Pavarini McGovern’s Vesuvio noticed a clear difference between luxury and market-rate apartment buildings in their respective MEP systems. “High-end buildings have more sophisticated HVAC systems, such as four-pipe and hydrothermal heat pumps, and the building envelopes are also lighter,” he says. Vesuvio notes that luxury goods are likely to have “some consideration for sustainability.”
9. Rising costs create headwinds for construction
In early July, the San Diego Business Journal reported that despite high demand, high interest rates and rising material costs are dampening luxury apartment construction in the market. The article cites Cushman & Wakefield senior director Jason Kimmel’s argument that high construction costs have made it cheaper to buy existing assets than build new ones, so investors are He claimed that the company is not actively working on building luxury residential towers.
The article went on to report that an upturn in the market is expected within the next two years. But for now, developers and their AEC teams across the country have been working aggressively to contain costs.
“While luxury designs have become more sophisticated and complex, project schedules and cost requirements have become tighter and more challenging,” says Suffolk Construction’s Lewis. Like many other GCs, Suffolk meets with developers, architects, engineers, and trade partners very early in a building’s lifecycle to ensure everyone is on the same page. It has started. “Our project teams leverage data, technology and AI to drive project efficiency,” he says.
Among Suffolk’s active projects is The Residences at 400 Central, a 46-story condominium in St. Petersburg that, at 515 feet, will be one of the tallest buildings on Florida’s west coast.
Building team collaboration early also helps Taconic Partners control costs on high-end projects. Ellery was designed by Handel Architects and built by Triton Construction, two companies with whom Taconic Partners has collaborated many times.
“It’s all about execution,” says PTM Partners’ Panturiano. “It’s becoming increasingly difficult and complex to build, and the margins aren’t necessarily great.”
10. A brighter but more competitive future
The U.S. Census Bureau estimates that construction began on buildings with five or more homes at an annual rate of 460,000 units in June, down 6.5% from the same month last year.
None of the sources contacted for this article believed luxury multifamily construction was in danger of plummeting, but the Fed’s resistance to lowering interest rates and the impact on borrowing costs There were concerns. “Luxury apartment starts will remain low until interest rates start to fall, which will make this product type more attractive as an investment,” JE Dunn’s Fleming predicts.
“Right now, it’s all about economic feasibility,” says NMHC’s Walter. It also points out that if the government’s current lending policies are not eased, ironically, the recent surge in the construction of luxury apartment complexes could lead to long-term funding shortages. (The Fed was expected to raise rates in September.)
Even if there is no shortage, the luxury multifamily sector is likely to remain hypercompetitive, with what Layton Construction’s Geyer sees as an “arms race” in amenities that is already recalibrating urban markets. The current situation is likely to persist. Howard Hughes said, “People seeking a luxury experience are choosing inner-city communities that were once considered residential. “This is a community that offers an office location close to the city center and connections to the local area.” We have great schools and activities, and a family-friendly environment. ”
Webcor’s Silva said he sees “tremendous interest” in prototyping alternative affordable housing that offers similar luxury lifestyle options through prefabrication and more efficient delivery methods. I am.
Adaptive reuse is also being factored into the equation, as in Chicago’s 6 Corners Lofts, which had its grand opening on March 18th. MG2 was the design architect and Novak Construction was the developer and GC for the conversion of this 80 square meter building to 394,247 square feet. The Sears store that opened a year ago closed in 2018, making way for a mixed-use building with 38 homes and a Target department store. The project maintained the building’s Art Deco feel by cutting out windows and adding balconies to the studios and lofts. 6 Corners’ amenities include a pool deck, fitness room, dog park, bootlegger, and coworking space.
Essentially, the definition of “luxury” will continue to be fickle as more buildings assert tenant and purchaser rights. Taconic Partners’ Schwartz said the choice will continue to be based on rent and location. But if all developers paid more attention to design and construction details, buildings that want to establish themselves as luxury goods would “better offer something special.”
