- June 10, 2020
Fresh out of college — yes, this was back in the day — I was apartment hunting in Berkeley, California.
I finally found one, but size-wise, I can tell you I’ve seen bigger closets in the Lake Club. But, it had a bed, and an ancient ice box that had been converted into a refrigerator.
I have no idea why.
The walls were made out of paper mache. The people who lived in the apartments surrounding me, I knew all their habits. And I mean all of them.
All righty then.
So as grateful as I was to find an apartment, after a year I wanted out. One of my coworkers at the newspaper where I worked owned an apartment building. So I moved.
It was a way bigger, two-bedroom apartment on the first floor. I thought it was great.
Then I met the guy who lived upstairs, a 6-foot-5, Berkeley policeman. He looked like a football defensive end.
Unfortunately for me, this guy’s shift ended about 2 a.m., and when he came home, he marched around on his hardwood floors.
Oh for goodness sakes. Please sit down.
The point is that apartments come in all sizes and shapes, and very few of them are perfect. I discovered early that I am a single-family home kind of guy.
So I was interested in seeing the 230-home Estia of Lakewood Ranch neighborhood for the first time just after it opened in 2020. It is made up of smallish single-family homes, all one- or two-bedrooms, that are intended to be an alternative to regular apartment living.
For one, your walls are your own, and not shared with a guy who plays the tuba.
Next, you have your own fenced-in lawn. Sure, you can't do more than four cartwheels in any direction, but if you have a pet, it is huge. More on that in a minute.
Most important, though, was the fact you would be experiencing the joy of a single family home while paying top-end apartment rent. There were windows in every wall, and the only things sitting on the roof were birds.
With fewer apartment options in the Lakewood Ranch area at the time, Estia sold like wildfire, and so did its sister community, 215-home Artesia, which opened in 2021.
It all made sense, but then apartment buildings began springing up like fire ants, and the real estate market took a crazy turn, and housing values skyrocketed. The rental market followed suit, and those who were paying $1,100 for a one-bedroom apartment were soon paying $1,800. Those two-bedroom apartments were $2,300. And those single-family home apartments had to keep pace.
As I drive though Lakewood Ranch, I can’t help but wonder if those single-family home apartments would be negatively affected by inflation. Sure it’s nice not to share walls with neighbors, but what is it worth to not have to listen to the neighbor’s cuckoo clock?
Would those single-family home rental communities — five in all recently built or headed to Lakewood Ranch — become ghost towns? A 2020 Forbes article called single-family built-for-rent homes as "The New Face of Rental Housing."
And while I might have thought those single-family home rental communities might be less attractive with bloated rents, a Northmarq market analysis in November said, "Single-family rental communities, which often have high-wage renters and low turnover, should stand out in the current economic climate."
Northmarq is a capital markets resource for commercial real estate investors.
Mike King, the director of multifamily operations and development for Zilber, which has built Estia and Artesia and currently is getting ready to open sales on its “The Tides” neighborhood in Waterside, said despite inflation, the single-family, built-to-rent home rental market remains hot..
“All three (neighborhoods) are roughly similar to traditional apartment sizes,” King said. “But it is adding a lot of benefits for tenants. No one is above or below you. You have a private outdoor, fenced-in space. You have lighting coming (into the home) from three or four sides. We liked them because we felt it would be an improvement on an apartment.
“Then both Estia and Artesia leased up incredibly quickly … much faster than we thought we would see. The market justified what we were thinking.”
King said not only is there a waiting list for someone to move out of Estia or Artesia, both those living in the community have their eyes set on longer-term leases. With so many new homes being built in Lakewood Ranch, King said those at Zilber originally thought that they would have several rentals on short-term leases as people wait for their homes to be built. That hasn’t been the case. Those who have rented have found their long-term home.
The Tides figures to continue that trend, especially since it is along Lake Spoonbill in Waterside and is only about a half mile from the Waterside Place entertainment hub.
“It is definitely going to be our best site so far,” King said.
The Tides, which will have 366 homes, will begin selling in June and Zilber’s website for the community will be available by the end of this month.
Furthermore, King said rents for The Tides will continue to hover at the top of the apartment market.
“A one-bedroom home will be under $2,000,” King said. “A two-bedroom will be in the low $2,000s. That’s where the rental market is."
He also stressed it would be tough to make the concept work without the help of developer Schroeder-Manatee Ranch, which made the land available for a price that would allow Zilber to make the project economically feasible.
“The challenge is that this (community) is so much less dense than a traditional apartment community,” King said. “It is not like you are piling them up in a four-story building. The challenge is there for most land sites in which (the landowners) are willing to sell for apartments. We couldn’t compete with that product type. SMR wants a wide diversity of living types — for sale and rent, everything. They saw this as another step, and they wanted to make it workable.”
And with SMR's help, Zilber can rely on how its products stacks up against "regular" apartments.
“Obviously, there is competition in Waterside,” King said. “But if people have pets, at The Tides they can let them go out in the yard.”
Through a doggy door.
King said a Zilber study of Estia and Artesia has shown more than 60% have pets.
“That stands out more than we thought,” King said. “Pet owners love the fact they have these built-in dog doors. All the back yards are fenced-in. Pets can come and go as they please. It is our No. 1 demographic.”