The general media has noticed a trend that apartment professionals have noticed for a while: Millennials and Boomers coexisting in apartment communities. Bloomberg recently ran a pretty long story about it:
The number of renters who are 65 or older will reach 12.2 million by 2030, more than double the level in 2010, according to research by the Urban Institute in Washington. While the millennial generation born after 1980 has driven demand for apartments in recent years, baby boomers — those born from 1946 to 1964 — will be the next wave, pushing up rents and spurring construction of more multifamily housing.
And the older set becoming renters is a big reason the apartment industry is doing so well:
“It’s a combination of their sheer size and that they’re entering the age range where they increasingly downsize,” Jordan Rappaport, a senior economist at the Federal Reserve Bank of Kansas City, who has also studied the subject, said in a telephone interview. As a result, “it will put upward pressure on rents for all types” of multifamily homes, he said.
Rappaport’s research found that adults in their 50s and 60s accounted for almost all of the net increase in multifamily occupancy from 2000 to 2013. Once members of the baby boom generation start entering their 70s next year and downsize, “multifamily home construction is likely to continue to grow at a healthy rate through the end of the decade,” he wrote in a report published last month.
Some developers are adjusting to address the trend:
Alliance Residential is designing buildings with smaller, more affordable units on ground floors to attract young adults, while creating more spacious apartments on upper levels, said Ian Swiergol, managing director of the developer’s division covering New Mexico, Arizona and Utah. The bigger units feature wine refrigerators and touch-button window screens that appeal to baby boomers with more wealth.
In one extreme example, a 28-year-old man ended up living in the same community as his 90 year-old grandmother, said Swiergol, who is based in Phoenix.
Who knows, maybe we’ll start seeing shuffle boards being built next to the swimming pools and volleyball pits.