Capital constraints and lifestyle changes among renter demographics are converging to make smaller, denser, downtown apartment communities the hottest spots to build.
For years, apartments have been designed without regard to building efficiency. Commercial projects have always considered the net-to-gross ratio (the ratio of net rentable space versus total gross building space) and are usually 82 percent to 85 percent efficient, while apartments have been far less efficient, with an average ratio of 70 percent to 75 percent.
A more sophisticated renter is changing the face of multifamily design. This renter seeks convenience, state-of-the-art amenities, and luxury interiors commonly found in single-family homes. Multifamily developers can successfully appeal to this renter-by-choice market that is willing to pay for exceptional floor plan design and five-star luxuries.