It may be a first: two very different generations, Millennials and Baby Boomers, now are competing for the very same apartments, at least in some towns.
“Their preferences are starting to cross," said John Darby, CEO of The Beach Company, a real estate development company headquartered in Charleston, S.C. "What Millennials desire are becoming the same as Boomers.”
Darby added that he has been in the industry 25 years and cannot recall a time when two different generations so often wanted the exact same apartments.
Exactly what do Millennials (born from 1980 to 2000) and Boomers (1946 to 1964) want in common? Darby said they both want “high end amenities, walkable communities, and they like the flexibility of renting,” as opposed to homeownership.
Bryan Fasulo, an executive with apartment developer Pinnacle Living in Phoenix, added that both liked “hotel type services,” and that may mean dog walkers available for hire, dry cleaning delivered to the door, concierges and attractive community spaces.
In both cases, too, the generations are converging on urban neighborhoods - often in city centers - because of the high level of services and amenities that are readily on offer. In Austin, Texas, 30-year-old Jesse Evans is at ground zero of this battle as a renter in downtown. He also is a regional vice president at property management company Renters Warehouse. “Retirees used to buy a small house," he said. "Now they are jumping on board with renting. Boomers will continue to be a rental factor.”
In hip Austin, he stressed, a lot of Boomers suddenly are on the downtown scene, often in the very same buildings with Millennials, and he does not see that changing. “We are seeing more Boomers downtown and we will continue to see more," he said. "They are attracted to the lifestyle.”
Who has more money to throw around in this war? Answers are unclear. Boomers, many of whom are newly attracted to rental communities, may be retired and on fixed incomes - so they may lack big money for rent. Millennials, on the other hand, often are saddled with student loans and many have a taste for finer things (good wines, good restaurants) and that may limit their wallet when it comes to rent. So mark the battle of the budgets as even.
In Austin, Evans said that often Boomers can in fact often out-spend Millennials, but as more of the latter hit 30, that arithmetic is changing. “The older Millennials can compete,” he said, probably because they have moved a few notches up the career ladder and thus command higher paychecks.
The big question may be: do the generations get along when they are thrown together in the same space, typically a fairly compact, afforded by an apartment complex? Note too: a huge apartment trend today is smaller units (Darby said 1,200 sq-ft. units were common a generation ago, but now the average unit size is nearer 750 sq ft), but shared community spaces are getting bigger and busier. That means - inevitably - people in a community, regardless of age, will mix together. Successfully?
Darby said: “When you have a good mix of ages it feels better. Everyone behaves better. The community gels better. “
Fasulo said that, increasingly, Boomers and Millennials are mixing - successfully - in the same community functions. “We are starting to see both Millennials and Boomers looking for social functions that are tying them into their neighbors,” he said. And both generations - unlike sandwich generations - appear keenly interested in in fact getting to know their neighbors.
Darby by the way indicated that - just maybe - Boomers are playing a sly card in their choice of residence. He explained: “Retirees want all the things Millennials want, because they want their children to come visit. They want the organic food, farm to table, fitness, walking trails, dog walks. And they really want to see their children and grandchildren.”
This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.