In luxury apartment buildings, each floor plan attracts a different renter. Whether it’s budget, storage space, household size or current living environment, I have found each unit type needs at least one specific feature to maximize rents. Developers who think about the renter’s perspective when designing floor plans will achieve the most success and the highest rents. Here are the essential features by unit type in luxury apartments:
Studio: Closet Space
Studios are typically rented by single individuals who don’t require a lot of living space. However, their need for storage is critical. A walk-in closet in a studio apartment is the key feature that commands rent premiums. The luxury studio renter is likely budget-conscious and aspirational. This often translates to lots of clothes, shoes and storage needs. If a developer is deciding between a larger kitchen or closet in a studio, opt for the closet every time.
Convertible/Junior One-Bedroom: Separation Of Space
A convertible or junior one-bedroom unit has a definitive separation between sleeping and living space. This renter often seeks a one-bedroom home, but the budget does not allow for a true one-bedroom. When developers creatively make the separation, it helps that aspiring one-bedroom renter appreciate the value of a convertible/junior one-bedroom. Some of the more popular convertible/junior one-bedrooms feature sliding barn-style doors or modular space makers that allow for ample natural light during the day but a good sleeping environment at night. This hybrid unit type often commands high price-per-square-foot rents and leases very quickly. It should also be noted that convertibles and junior one-bedrooms are used interchangeably to describe this type of apartment.
One-Bedroom: Design For Couples
According to comprehensive data on over 1,000 Class A renters in downtown Chicago analyzed by my firm, couples lease over 60% of one-bedroom rentals. These are often couples who start their search seeking a two-bedroom but quickly realize a large one-bedroom to be a better value. While willing to sacrifice the extra bedroom, they will not sacrifice living space or closet space. Thoughtful design is key for appealing to couples when it comes to a one-bedroom floor plan. Corner one-bedrooms are most well-received. Typically reserved for two-bedrooms in most high-rise buildings, corner units can command rent premiums.
Another variation of the one-bedroom is the one-bedroom plus den. A large portion of renters are working from home and appreciate a workspace that provides a separate work area and privacy when taking phone calls or working odd hours.
Two-Bedroom: Master Suite And A Balcony
In many newer Class A apartment buildings, we have seen a lower percentage of two-bedroom apartments being offered. Because there are fewer, the demand for two-beds seems high, and developers/owners can capture a real premium if designed right. While many think about roommates as two-bedroom renters, our findings don’t support that. Developers should create a true master suite to accommodate a king-size bed, two bedside tables and additional bedroom furniture, plus a bathroom with double sinks and a frameless glass shower, plus a large walk-in closet. A unit with these features has the highest rent potential. Additionally, if there are limited balcony or terrace opportunities in the building, reserve them for two-bedrooms. Renters who are willing to spend for a two-bedroom highly value outdoor space.
Three-Bedroom: A House-Sized Living Room
Square footage is a key selling point for a three-bedroom renter. Many renters are downsizing from large homes, often becoming renters for the first time in decades. The living room needs to be large so renters have a layer of comfort as they transition out of a detached home into a shared living experience. Additionally, three-bedroom renters are often entertaining guests — that’s likely the reason they want a three-bedroom unit. Large kitchens with open concept living rooms and with enough space to accommodate a dining table are very well-received.
Penthouse: A “Wow” Factor
Whether it’s epic views, fine finishes or outdoor space, penthouse renters need to see key differentiators in their unit as compared to others in the building. This renter wants to live in the “best of the best” and is willing to pay for it. Views, outdoor space and ultra-luxe finishes are vital to achieving the highest rents. Higher ceilings are also a nice plus in penthouse units. Developers should focus on elements that push the boundaries in design and luxury feel. Most recently, we’ve seen private pools, fully serviced dining rooms complete with private chefs, in-unit elevators and custom finishes fit for the most discerning renters. Penthouse apartments in Class A apartment buildings are some of the most upscale real estate being developed today.
Overall, developers need to remember the person renting the studio is very different from the person renting the two-bedroom unit. Appealing to each renter profile and designing a unit type for each of their lifestyles is the key to success.