There was a time when electric cars were easy to spot. First, there was the Toyota Prius hybrid, slowly followed by the Chevy Volt and the Nissan Leaf. A little over a decade later, Tesla introduced the Model S. While a handful of other models were introduced during the same period, it wasn’t until 2016 that new sales of electric vehicles (EV) and plug-in hybrid electric vehicles (PHEV) took off. With the trend only expected to rapidly increase, those of us in multifamily are going to find ourselves responsible for resident charging capability.
A Shift in Perspective
In the last two decades, the United States has witnessed a significant shift in the interest in environmental issues, including recycling, energy use, and EVs, the latter of which has seen some false starts. In 2012, Tesla’s Model S lit a spark in the EV market, and it prompted U.S. auto manufacturers to produce a wider range of models. In 2017, new EV sales broke 200,000 annually for the first time. Sales then jumped to 300,000 in 2018 and hovered around that number until last year, when an astonishing spike sent new sales to more than 600,000 per year. According to KPMG, this trend is only expected to increase, with 52% of all new vehicle sales projected to be electric by 2030.
The increases in production and the surge in environmental concern in society, along with governments taking more substantial environmental positions, have combined to foster a more permanent and growing adoption of EVs throughout the nation. The decision by all major auto manufacturers to offer EVs and PHEVs in affordable, midsize, and luxury models has driven up appeal, meaning EV charging stations are beginning to shift from amenity to necessity.
While electric vehicle sales in the past were primarily made by single-family homeowners, the increased affordability means ownership among multifamily residents will inevitably increase. In a survey by CarMax in 2021, over half the respondents said their next purchase would be an EV. The affordability means no multifamily property—regardless of property type or location—can overlook the need to install a greater number of charging stations on their properties, and it will need to start soon.
EV Charging Is a Must-Have Amenity
Making this type of investment now may not seem to be the best move, after all, the 2022 National Multifamily Housing Council/Grace Hill Resident Preferences Survey showed only 2% of renters said EV charging stations were a requirement to rent. However, in the same survey, over a quarter of respondents were interested in having charging stations as an amenity. That’s close to the same number of people who said their next vehicle purchase would be a new or used EV in a recent poll conducted by YouGov for Forbes Wheels.
Any community that doesn’t have a plan for installing charging stations or started the process of installation could find itself behind the curve. Lead and installation times will only get longer, and residents will choose to spend their housing dollars at a place that will let them easily charge. Communities without charging or with only a handful of cursory stations will struggle to compete with properties that had the foresight to prepare. It’s already the case with many other housing, commercial real estate, and retail establishments.
The hospitality industry has set the standard for EV charging. Many hotels have made a solid commitment to providing adequate charging stations for their customers. Even retail outlets and restaurants are starting to see customers will choose their establishments over others based on the ability to charge during their visit.
If multifamily communities want to stand out from their competition, they need to appeal to those prospective residents. While the initial investment can appear to be a little steep, it’s important to consider the possible return as the future changes. Residents will be looking for homes that not only have one or two chargers but enough where they can reliably charge at any time. It’s not unreasonable for new multifamily developments to consider installing EV charging stations in 50% or more of their spaces, and current properties should look at making significant leaps in the number of EV spaces.
Easier and More Affordable Than You Think
There’s no doubt that a thoughtful environmental, social, and governance (ESG) strategy is imperative in today’s multifamily landscape. Installing EV chargers is an advancement a community can make that isn’t as difficult as other ESG retrofits, and there are ways to help reduce the infrastructure costs. There are EV chargers now that don’t require a Wi-Fi or cellular connection in order to operate, which not only eliminates expensive IT upgrades but also solves connectivity issues.
Even if the upcoming demand isn’t enough to spur owners and operators to take action now, the continued push by local and federal governments should be. This is the time to take advantage of tax rebates and financial assistance while it’s still available. This will help owners and operators avoid the risk that the incentives will eventually become mandates and the advantages that help offset the costs will vanish. Not only that, but when has playing catch-up ever been a better choice than preventive action?
EVs are a solid segment of the automotive field, and the projections show their presence will soon be as ubiquitous as gas vehicles. Consumers are moving toward EV, manufacturers are moving toward EV, other consumer industries have embraced it, and now it’s time for multifamily to get charged and ready for the future.