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The Wall Street Journal’s Katy McLaughlin explains how COVID-19 changed the way a developer is building his projects. She writes:
Someday, years from now, a resident will wake up in their luxury condominium at developer Gregg Covin’s The Cedars Lodge & Spa in Hendersonville, N.C. They’ll make breakfast on the island in their big kitchen and sit on their heated balcony. They’ll walk out of their private entrance and use an elevator that serves only three other units. They’ll work out in a series of small exercise rooms and gather with friends at a restaurant in a glass atrium.
Hopefully, Covid-19 will be a distant memory. But every aspect of these homes will have been shaped by the pandemic.
Mr. Covin tore up his original plan for a part-hotel, part-condo project with small kitchens, few balconies and large amenity spaces, and began redrawing the concept in March. “For sure, there are going to be long-term changes in behavior because of this,” said Mr. Covin, who still aims to break ground this year.
One of the trickiest parts of a luxury real-estate developer’s job is divining what buyers and renters will value—and pay top dollar for—in the three, four or even five years it takes to go from design to completion. Covid-19 has made that more complex, as developers try to tease out which parts of the pandemic experience will fade away and which will remain as part of the culture.
Some costs can be passed on to the renters or buyers who want the changes enough to pay more for them. Mr. Covin, for example, was originally planning units in the $300,000 to $500,000 range, but now thinks buyers will pay $350,000 to $750,000 for larger units that can be used as second homes.
Rental developers also are betting the postcrisis market will reward them for adding or installing specialized furniture that can make a small space seem larger so residents can work from home more comfortably. Other changes aimed at improving air quality or enabling distancing from other residents—such as re-engineering ventilation systems, adding elevator banks, or reconfiguring common areas—may help lower resistance to high-rise living, a lifestyle that has taken a beating in this crisis.
There is evidence already that the amenities and elements valued by the rental market have changed since the pandemic hit. Luke, a conversation-friendly real-estate chatbot that texts listings to apartment hunters in New York City, analyzed 30,000 messages from potential renters between December and February and compared them with those between March and May.
The New York-based company found that requests for home offices rose from 0.5% of messages prepandemic to 3% once the pandemic hit. Private outdoor space requests jumped by 20%, while requests for in-unit laundry (a rarity in New York City) went up 17%. Interest in gyms plummeted. Requests fell by 10% for in-building gyms and by 50% for gyms nearby.
Read more here.
