Written and published by Ken Brown
For those of you who don’t know- I have the privilege of interacting with superintendents, project managers, project engineers and estimator candidates on a daily basis. While the main topic always seems to be an apparent labor shortage in construction management – more recently ‘disruptive building technology’ seems to be a trending topic. While I’m no apartment building expert, I am deeply entrenched in the marketplace through the candidates I represent.
“We live in an age of disruption. The internet democratized information and shrank the globe. Uber is the world’s largest taxi service without owning any vehicles, and Airbnb dominates the lodging industry without property. Currency is going crypto. Technology is transforming business as we know it, and no industry—including apartments—is immune.” This is a quote from the first paragraph of the most recent NMHC disruption report. The report goes on to say “On the horizon is a massive wave of demand for apartments that stretches well into the future. In fact, the industry will have to build at least 4.6 million apartments by 2030 just to keep up with demand for apartment living and product.
However, anything being designed today won’t see its first resident until the early 2020s, forcing the industry to become even more anticipatory, progressive and innovative when it comes to serving the next generation of renters’ needs. By 2030, the world’s likely going to be a much different place.”
So what does this mean for multi-family builders across the nation? The times, they are a changing! Changing so fast that builders are going to have to proactively work and be very forward thinking when it comes to technology, trends, and lifestyles. Today I am going to discuss two major trends that multi-family builders are going to be aware of over the next five years: (1) smart home technology and (2) how renters will interact with their local community within shared and private spaces.
Smart home technology is nothing new. It’s been slowly creeping into our lives since we let Siri out of the box in 2008. Now with Siri’s main rival Alexa on the scene and others to follow, the race has begun. The way I see it, the suites of connected smart home technologies have gone from pricey and novel to expected and affordable. Depending on the technology you desire, i.e. a learning thermostat or light bulbs that turn themselves one when you are within 50 feet of your home, the prices can vary. The one thing that remains constant with technology is that the price decreases 50% every nine months and the technology doubles every nine months. This means the average apartment builder has some serious decisions to make when building their next project. What is novel today will be expected tomorrow.
The builders that integrate smart lighting, learning thermostats, connected sensors for air quality and Co2 detection, as well as voice-controlled everything, will be the highest ranked amongst the millennial renter of the future. The main piece of advice I can offer here is that seeing these technologies as an add-on is the wrong mindset. Moving forward I see these as backbone technologies that you should begin to think about designing your properties around versus merely adding them on as finishing touches.
Technology hasn’t just made our homes smarter, it has made our communities smaller and more connected. Because of technology, especially the online sharing economy, meeting people is easier than ever before. Millennials share their cars via Uber and Lyft, their bikes, their boats and just about anything else they have. Shared working spaces as well have become very popular amongst the younger generation and companies like WeWork have taken full advantage of this trend. But it isn’t just possessions and common spaces the renter of the future will want to share, it’s even their personal space!
“According to results of the most recent NMHC / Kingsley Associates Renter Preferences Report, nearly half (49 percent) of respondents under 25 said they are interested in having an opportunity to earn extra income by listing their apartments on short-term rental sites while roughly a third (32 percent) of apartment dwellers over 65 reported they wouldn’t rent in a community that allowed short-term rentals.” What does this mean for builders? Well, the designs of today will soon be obsolete and future building design will need to incorporate short-term renters, ride-sharing, co-working, and blended community space along with the integration of immersive retail experiences that are walkable. It’s a lot to consider!
In my opinion, these are two of the most disruptive trends multi-family builders need to be aware of over the next five years. Other major trends include millennials living more health-centric lifestyles, how millennials shop primarily online versus retail and the shifting away from traditional one and two bedroom floor plans to more open plans where working from home is common.
Having the right construction leadership is one thing, having the right construction talent in the field is another. Having a construction recruiting firm that is fully engaged, immersed even, into the trends of your industry is still another. While often overlooked, a recruiting firm’s work product controls your future employees, your future employees control your future building products, and your future building products determine the future of your business.
As a business leader or chief executive of a multi-family builder you owe it to yourself and to your team to have the very best recruiting partner in the multi-family space — you owe it to yourself to work with Hire 10.
Hire 10 is the industry leader in recruiting for the multi-family space. If you would like to learn more about how we’re turning the multi-family labor market on its head, shoot me an email at [email protected] If you’re not completely shocked by our business model, I’ll staff your next position for free.
For more information on disruption in multi-family check out: http://disruption.nmhc.org/the-report/
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