When residents enter certain leasing offices for Mid-America Apartment Communities, they’re not always ready to renew their lease. To entice them, the Memphis, Tenn.-based REIT isn’t throwing in a DVD player; it’s considering a program to offer undecided residents an upgraded unit.
The program could offer some advantages, including the opportunity to keep its redevelopment platform up and running, while also retaining residents and limiting turn costs. The renovations would occur in properties currently under rehab and would allow residents to stay in their unit throughout the process. At first, David Nischwitz, senior vice president and director of property redevelopment for Mid-America, thought his residents would be resistant to a price increase in this economy, but feedback indicates otherwise.
Others aren’t so sure customers will pay more, regardless of the circumstance. When asked about renovations in general, Frank Apeseche, CEO of Boston-based multifamily owner Berkshire Property Advisors, says, “If you are concerned about your job, the last thing you want to do is push your rent. The thing people don’t have a handle on is what’s going on with wages and salary. Until that confidence comes back, I don’t think you’ll have the consumer stepping up.”