With a tap on a smartphone, more and more apartment renters are getting a taste of some of the conveniences once reserved for luxury homeowners. Home automation systems can remotely control temperature, lights, shades, and music; turn security systems on and off; open and close garage doors; and lock and unlock doors.
“It can even flush your toilets if you want. It can expand to that level,” said Noah Ostroff, a developer, operator of the Keller Williams Philly brokerage, and board member of the Building Industry Association of Philadelphia.
It used to be that smart-home technology a la The Jetsons was just for tech-savvy early adopters looking for convenience by using gadgets in their single-family houses. But as the technology has gotten cheaper and easier to use, more property owners and developers are putting it in apartments and condos to attract and retain residents.
“In the last 10 years, we’ve talked about the amenities arms race in multi-unit development,” said George Hayward, a senior director of development for South Carolina-based Greystar, a global owner, operator, and developer of rental housing. “That competition has transitioned from a cool club room or great pool to much more technology-focused.”
Because technology evolves quickly, Greystar focuses on its ability to be flexible with whatever comes next, which means being in tune with what matters most to residents and not basing construction or design on specific technology, Hayward said.
“We try to be forward-thinking, but we’re essentially trying to battle against obsolescence, as well,” he said.
Ostroff has put different versions of smart-home technology in his properties, including the Lombard Estates and Rittenhouse Estates on Lombard Street, for several years.
In his latest project — a four- and five-story mixed-use development at 24th and Washington in South Philadelphia, which will break ground this spring as Innovator Village — all 82 units of apartments, condominiums, and townhouses will be equipped with smart-home technology.
John Clarkson, managing director of development for Greystar’s Mid-Atlantic division, said smart technology is “not only a nice-to-have; it’s a must-have to attract the tenants we want in our apartments.”
Wanted: Smart thermostats
A July report by the National Apartment Association that surveyed 165 members and 745 residents showed large potential for growth for the industry.
More than four out of five apartment residents surveyed who don’t have smart-home technology said they want it. Residents were most interested in smart thermostats — the kind that learn habits and automatically adjust a home’s temperature, or that can be controlled remotely through an app — followed by security cameras. They also wanted smart door locks and lighting.
“Owners and operators who have not yet dipped their digital toes in the silicon with smart-home technology will find themselves falling further behind at a faster pace,” the NAA research report predicted. “While not all communities are suitable for top-of-the-line technology, features now considered basic — security cameras, smart thermostats, motion-sensing lighting, resident portals — can go a long way toward attracting and retaining residents.
“One thing is certain: As residents become increasingly engaged with smart-home technology, it will be harder to break them of the efficiency, convenience, and control when they’re considering a move to another community.”
The term creepy did pop up a few times in the survey to describe some residents’ hesitance to adopt the technology. It’s a feeling that property owners could help dispel with education, transparency, and data security, said Paula Munger, assistant vice president of research at the National Apartment Association.
Elaborate smart-home systems have been integrated into purchased properties for more than a decade. But in the last couple of years, said Mike McNelis, chief executive officer of the rental brokerage Philly Apartment Co., the technology has become “a focal point” for new rental construction.
“As the real estate market continues to shift into a more renter-based market, you start to see renters ask for the same types of amenities,” he said.
A draw for millennials
Millennials, who are “more apt to want and use technology in their homes,” make up 85% of his company’s business, McNelis said. But renters of all ages are becoming more interested in the convenience that smart-home capabilities bring. Over the last few years, this type of technology has become both more desirable for renters and cheaper for builders to install — “kind of a perfect storm,” he said.
Ultimately, price and location are still the top motivators for both home buyers and renters, he said. But if all else is equal, he said, given the choice between a home with smart technology and one without it, people are choosing smart-home capabilities.
In a city such as Philadelphia, which has a lot of older housing, landlords are trying to figure out what technology to offer and how to include it to compete with new apartment buildings, she said.
Sean Edwards, founder and president of a technology integration firm that installs and maintains smart-home infrastructure for multi-unit buildings, said his clients in the region are pretty evenly split between retrofits and new construction.
His company, Rittenhouse Communications Group, can update existing infrastructure in older buildings to support new technology or install new infrastructure during renovations. Building owners can install as much or little as they want or can afford, and add capabilities later. The infrastructure is designed to adapt to constantly evolving technology.
Edwards founded his company in 2010, but business really picked up five years ago.
“A lot of the developers right now really seem to get it and realize it’s crucial to standing out in the market,” he said.
Most smart-home technology has been going into new, high-end construction.
For example, at 2100 Hamilton, a 10-story, 29-unit building of multimillion-dollar condominiums planned off the Benjamin Franklin Parkway, elevators will use facial recognition to take residents directly into their homes.
Developer Carl Dranoff is partnering with lighting control company Lutron, and including as standard smart-home technology features such as remote lighting, temperature, and music control in his new multimillion-dollar, 108-unit Arthaus condominiums going up at Broad and Spruce, and scheduled for completion in spring 2022.
It’s a first for Dranoff Properties, said Julia Dranoff Gutstadt, managing director and chief operating officer. If residents of the 47-story building forget whether they left the lights on, for example, they can turn them off from wherever they are when they think about it.
Extras include shades that residents can raise and lower remotely, and a programmable shower that residents can preset according to their water temperature and stream preferences.
Also a first for Dranoff was the decision to include smart-home features in the project’s showroom to acquaint potential residents with the technology.
Five or 10 years ago, the condos’ target market — wealthy empty nesters looking to move to the city — weren’t asking for smart-home technology, Gutstadt said. But that’s changed in the last couple of years as consumers become more educated about the technology.
Stephanie Vaughan, a specification manager who represents Lutron, said that although smart-home technology has traditionally been a high-end feature, the company has reached into the mid-market in the last few years.
In short, Munger of the National Apartment Association said, “we’re going to see a lot more properties that have many of these types of features.”