After years of steady and inclining trajectory growth, the multifamily housing market flattened with the rise of the 2020 pandemic. Though inevitable, this stunt in development ultimately weakened multifamily construction throughout 2021. However, though 2021 did contribute to new significant improvement as the first half of the post-pandemic rebound, it paved the way for 2022 to finally obtain modest gains and stabilization. In fact, CBRE believes that 2022 will be the year that the real estate market (as a whole) will make a full recovery.
Looking through the forecasting lens, the multifamily housing market is surely heading in a much more proactive and progressive direction. That rapid climb back to the top sparked some new trends that will likely surface throughout the upcoming year. With the FaverGray team performing over 100 projects throughout the last 17+ years, they were able to construct a list of forecasted predictions of what those trends may be.
Expanding Office Nooks
The pandemic came with a massive surge of people both working and studying from home. According to Global Workplace Analytics, it is estimated that 25-30% of people will still be participating in some form of remote work by the end of 2021. Because of that change in the workforce, it ignited the need for better WIFI connectivity and the exploration of expanded office nook space in units.
In addition, multifamily general contractors are rethinking the traditional conference room amenity that often holds 10+ chairs and a round table. Future developments might be better suited to converting that space into 12+ individual work nooks or rooms along with some smaller meeting areas to accommodate the higher remote/hybrid demand. Furthermore, these rooms could have the option to be rented out to the general public as a way for developers to gain a faster return on investment.
Electric Vehicle Accommodations
It is no secret that electric vehicles have gained a lot of traction in recent years. Statistics show that there are over 1.8M EVs in the United States as of 2021. With that, it stands to reason why a new predicted trend is the integration of ample charging spaces for EV users to plugin as needed. At this point, with EV use being the minority, general contractors are planning on starting the process of adding charging stations now with space to expand as the demand increases in the future. Keep in mind that this prediction depends heavily on geographic location and demographics. Nonetheless, it is a trend that will likely begin in the more EV utilized areas and bleed into surrounding locations as EV transitions into the new norm.
Bigger and Better Shipping and Receiving Areas
Amazon’s profits increased nearly 200% since the beginning of the pandemic. Now, online shopping has always been an uprising means of supply and demand since the birth of eCommerce relations. With it skyrocketing intensely in 2020 and expected to remain in high demand, you are likely going to see an upgrade in the shipping and receiving areas of multifamily housing. After all, the extensive increase in shipments and deliveries means parcels require more support, space, and security to accommodate.
Overall, general contractors and developers within the multifamily market are proactively creating ways to build better integrated and larger package shipping and receiving areas – all in an effort to ensure residents, staff, and shipping personnel can collectively have a more seamless experience.
Summary – The Second Multifamily Rebound
Intertwining natural modernization trends with unforeseen ones stemming from the pandemic, the year 2022 will be a monumental one for the multifamily housing market. Not only will it likely result in smart technological upgrades and conveniences, but it will help steer the industry back to a state of pre-covid growth normalcy.
In summary, general contractors, multifamily developers, and investors have a lot to look forward to when these concepts unfold. As the second and hopefully last market rebound after facing a rippling foundation, 2022 holds the substantial potential to excel in the industry now and help repave the way for a sustainable, growth-driven future.
Resources
https://www.favergray.com/blog/2021-multifamily-predictions-from-a-multifamily-general-contractor/
https://www.mashvisor.com/blog/2022-real-estate-market/
https://globalworkplaceanalytics.com/work-at-home-after-covid-19-our-forecast
https://researchfdi.com/amazon-covid-19-pandemic-profits/
https://fortune.com/2021/09/02/housing-market-predictions-2022/
