Multifamily real estate is at a turning point. After a decade-long bull run of increasing rent growth and compressing cap rates, things have started to slow down. The demand for multifamily housing remains high due to the ongoing housing shortage, but the slowing economy is making renters more price-sensitive. In fact, almost half of U.S. markets saw multifamily rental prices drop over the last year. At the same time, inflation has made it much harder for multifamily owners. The cost of running a building continues to increase, and interest rates are higher than they have been in nearly half a century. Even if inflation cools and rates decrease, the sector will remain competitive. More investors are pouring into the space, many from other property sectors, and more new apartments are coming on the market in 2024 than in any year since Richard Nixon was president.
These factors have forced the multifamily industry to innovate, and it has innovated. Developers are finding new ways to fit more units into less space, engineers are working to make buildings as efficient as possible, and owners are introducing new services and adding impressive amenities.
To showcase the innovation happening in multifamily right now, we have put together a showcase of innovative multifamily properties. Each property has been selected from a long list of great candidates for its uniqueness and ability to solve some of the problems currently facing the industry.
Most multifamily properties strive to be more sustainable, but few achieve “net zero” status. Solara, an 11-building, 340,000-square-foot property in Rotterdam, New York, has managed to do so. The developer, Bruns Realty Group, previously completed New York’s first-ever net zero multifamily development, netZero Village, and applied their learnings to this three-phase project.
Solara features an efficient design that leverages renewable energy sources in multiple ways. The entire carport is covered with solar panels, producing 153,000 kilowatts per year, enough to power the entire property. Each building has its own solar-powered direct hot water system, supplemented by air-to-water heat pumps. The property also includes a solar-heated pool and 36 EV charging stations.
While Solara’s on-site energy generation is impressive, its methods for reducing consumption are even more noteworthy. The development, a two-time winner of NYSERDA’s Buildings of Excellence award, is incredibly well-insulated with a thick layer of foam on the roof and walls, as well as a vented “mini-attic.” The design team used the Passive House Planning Package to model energy consumption and incorporated several passive solar strategies, such as orienting buildings to maximize daylight in the winter and adding exterior shading to block the sun during peak heat hours in the summer. To dispel the myth that net zero buildings require expensive, state-of-the-art materials, Bruns Realty intentionally used cost-effective, commonly available materials and traditional construction techniques.
Read our deep-dive on Solara
Walkability and a car-free lifestyle used to be achievable only in dense urban areas, but buildings like Vero in Tempe, Arizona, are challenging that notion. Built within Arizona State University’s Novus Innovation Corridor, the 200-unit, seven-story development offers an urban lifestyle in an area known for its sprawling suburbs. The large student population in the area meant that rents needed to be kept as low as possible. Vero achieved this by shrinking rooms to as small as 360 square feet. Many units are rented furnished and include space-saving furniture like Murphy beds.
Proximity to nearby transit stations and the mixed-use nature of the surrounding innovation park allowed developers to reduce parking significantly compared to typical Sunbelt markets. Parking is not included in the rent, so many residents prefer to forgo a spot. This has helped Vero achieve a parking ratio of 0.7 spaces per unit, compared to the area average of around 1.15. This innovative approach not only reduces costs but also encourages a more sustainable lifestyle among residents.
Despite the focus on affordability, Vero offers several high-end amenities, including a fitness center, co-working space, and a dog wash station. Forty of the units are studios that still provide space for full-sized appliances, storage, and bathtubs. The property also includes communal spaces that foster a sense of community among residents, such as shared lounges and outdoor seating areas. Vero’s connection to surrounding offices and school facilities makes it attractive to both students and young professionals. The building’s design echoes this youthful yet sophisticated vibe with bold yet elegant accents and fixtures, creating a stylish and inviting living environment.
“Biophilic” is a word frequently used in the architecture and design worlds, often implying little more than an abundance of indoor plants. However, the Optima Verdana building stands out for its truly biophilic design, using plants not only to enhance the local ecosystem but also to provide the building with added functionality. This 100-unit building features self-watering troughs on each balcony, growing cascading plants that hang like curtains once fully grown. According to David Hovey Jr., president and COO at Optima Inc., these plant curtains “promote evaporative cooling, re-oxygenate the air, reduce dust, smog levels, and ambient noise, detain stormwater, help insulate the building, and shield residents from the sun’s rays.” Hovey and his team tested different bed designs and evaluated various types of plants to ensure a suitable option that looks good year-round.
Optima Verdana was designed to be Two Green Globes Certified, a designation given by the Green Building Initiative. This certification considers sustainability, occupant health, and building resiliency. Low-carbon concrete was used in the construction, and all windows are made with bird-friendly glass on the first three stories. To foster community, the property offers numerous amenities, including a recreation center with a wood court for basketball or pickleball, a golf simulator, and a game room. The rooftop features perhaps Optima Verdana’s most impressive amenity: an indoor/outdoor pool encased in retractable glass for year-round use.
Optima Verdana demonstrates that sustainable design does not have to impede resident comfort; it can, in fact, enhance it. Extras like complimentary coffee and towel service are ecological ways the building provides a better experience for residents.
Even though most of us want our housing to be affordable, the term “affordable housing” can have a negative connotation due to the proliferation of uninspired, low-quality affordable housing complexes. That might be why Jason Macklin, Director of Development at Wingspan Development Group, the team behind Niche, prefers to call it “attainable” housing. “We are not high-rise developers, so we target urban markets just outside of downtowns where we can deliver prices below downtown rents,” Macklin said. Keeping rents attainable was a significant consideration in the design of the building.
Niche is primarily designed out of wood, helping keep material costs down. However, it has a few design tweaks to address some of the shortcomings of timber construction. To achieve extra height (code in Tampa limits wood structures to six stories), the team at Wingspan built a cement ground floor ‘podium’ that allows them to add an extra floor and fit 251 units into a small corner lot. The wood structure was also built around a cement parking lot, which serves the dual purpose of providing covered parking and supporting the community rooftop pool.
The most unique aspect of the Niche building is the furnished options that come with state-of-the-art transformable furniture. Some of the building’s units have beds that retract into the ceiling, made by the company Ori, to provide more living space during the day. They have also added some of Ori’s ‘pocket studios’ to their smallest units, which feature a desk on one side and the choice of a bed or a closet on the other. The success of Niche is proof that a luxurious lifestyle can still be maintained in an attainable way with the right design and furnishings.
Niche also offers various amenities designed to enhance the living experience while keeping costs low. These include a fitness center, a co-working space, and a communal lounge area. The building’s location provides easy access to public transportation and nearby urban conveniences, making it an attractive option for young professionals and families alike. The emphasis on both affordability and quality has made Niche a standout example of what attainable housing can achieve.
Read our deep-dive on Niche
A common criticism of any new large development is that it can push out long-term residents and alter the cultural fabric of a neighborhood. When Brookfield was selected as the developer of a 1.7 million square foot site in San Francisco’s SoMa District, they had a clear mandate to not only respect but enhance the cultural heritage of the neighborhood. In 2016, SoMa became San Francisco’s Filipino Cultural Heritage District, and the city was heavily involved in turning the 5M project into a true mixed-use center for art and culture. “From affordable housing to new outdoor space and cultural programming, this community-led project addresses a wide range of neighborhood needs that for too long have been neglected,” said San Francisco Mayor London Breed.
The George is the largest multifamily building in the 5M plan. It stands 21 stories tall and contains 302 units, including 71 studios, 103 one-bedrooms, and 128 two-bedrooms. Ninety-one of the units are priced below market rate, targeting middle-income renters earning between 100-150 percent of the Area Median Income. The building was designed with input from dozens of local partners and has earned both the LEED Social Equity Innovation designation and a 2-Star Fitwel certification. The George offers a number of “supportive housing” and middle-income units and provides an easy online portal to help prospective tenants navigate their options. It features standout amenities such as a professional bar that can be reserved by residents (named after local Olympic gold medalist and proud Filipina Vicki Manalo Draves) and a private library with an impressive book collection.
The 5M development also includes a neighborhood park and sculpture garden. To support local artists, Brookfield donated a renovated historical building to the Community Arts Stabilization Trust, which uses the space for cultural, art, and educational programming. “Arts and culture organizations—groups like Women’s Audio Mission and PUSH Dance—are so essential to our city because they’re pushing the boundaries of creativity and equity while also creating community cohesion,” said Community Arts Stabilization Trust CEO Moy Eng. The building is already home to several important local organizations, such as Women’s Audio Mission, a nonprofit dedicated to advancing women in music production and recording arts, and Push Dance Company, a studio dedicated to “restorative dance practices.”
The 5M project demonstrates that large-scale development can be thoughtfully integrated into a community, preserving and enhancing its cultural heritage while meeting modern needs.
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