Does Size Matter? Why Developers are Embracing Micro-Units
Whether you call it a small studio, an innovation unit or a micro-unit, the definition is the same – it’s a REALLY small apartment ranging in size from 250 to 450 square feet. Micro-units provide everything a renter would need including a kitchenette, living space (which is also your sleeping space), a bathroom, storage and even a well-placed washer/dryer.
We’re Not in Kansas Anymore Toto
Not surprisingly, Micro-Units first started appearing in densely populated metropolitan cities with robust centers of employment. Cities like Seattle, Boston, San Francisco and New York were the first to introduce the concept, but the popularity of these buildings has since spread to areas like New Jersey’s Gold Coast. Developers in these markets began exploring the use of Micro-Units to offset the rising cost of land and construction costs – more units can mean more profits and the ability to offer more amenities.
The Psychology Behind the Micro-Unit
It’s a known fact that millennials are more attracted to amenity rich co-living buildings. They are willing to trade square footage for a vibrant, convenient location. They want to live alone but can’t necessarily afford the high cost of rents. They want to spend more time socializing and connecting in shared spaces rather than just sleeping and watching television. Being environmentally conscious is a big part of Micro Living. Less space means less electricity and less stuff which means less waste. This is the less is more generation.
Let’s Talk about Amenities
When a building has more units, it can offer more amenities as the cost per unit for these amenities goes down. It’s simple math. Some of the most successful Micro-Unit buildings offer amenities such as hotel style lobbies with light, air and even a living plant wall, bike room, gym, yoga studio, infrared sauna, roof deck, multiple lounges and community rooms with work stations to be used as gathering places, community kitchen for cooking classes and group meals and of course, a dog walk. A live-in Cultural Director will help tenants feel connected by planning wine tastings, barbeques, guest speakers, stand up comedy in the café, a flower arranging workshop and other social events. And what would a building be in the Age of Amazon without a state-of-the-art package management system!
The Future of Living… Today!
Micro-Units are a fantastic choice for anyone who wants to live in the heart of a thriving city while leaving their roommate days behind. A well-designed micro-unit with high ceilings and large windows, hardwood surfaces and new appliances shows and lives very well. It’s very easy to dismiss the concept as too small or cramped, but at certain points in life, living small can have big rewards.
Kathy Anderson, Founding Partner of Progress Capital Advisors recently secured an $84 Million construction loan for a 631-unit apartment building being constructed in Jersey City, NJ. The Element will include 277 units under 500 square feet with rents starting at $1,295 per month. Progress Capital is a commercial real estate advisory firm serving clients since 1990. With over $40 Billion in closed loans and $150 Million in directly funded bridge loans, we get you to the closing table. For more information, contact Kathy at 908-601-4891.