Do Renovated Common Areas Impact Revenue and Rents?

I would like to get input on whether you believe/think/have evidence that updated common areas (leasing offices, hallways, gyms, laundry rooms) have impact on rents/revenue/renewals. My company offers both flooring and design services to the apartment market. As we all know, there is a large disparage in how common areas are designed/decorated. I am researching how this impacts rents. Does a fresh/contemporary design improve the leasing agent's ability to rent and/or the amount of rent that can be generated?

We are living in a time when people/prospective residents have enormous access to design primarily through the internet (Pinterest) as well as a number of home improvement television shows. Has this impacted what is important to them when they are considering a place to live?

I would welcome any input on this subject or suggestions as to where I can gather more data/information.

Thank you in advance.

Amenities in general have an impact on revenue and rents. My building is 40 years old and a bit outdated, but we try to upgrade a little bit every year. Last year we put new carpet in the hallways, this year we installed new fencing.

We've also added a book exchange to the community room, subscribed to a few magazines for the rack in the laundry room, and add a new piece of fitness equipment every few years.

Residents get rent increases, but we increase length of tenancy by spending some of their money improving their quality of life.

I think the answer to this question is very subjunctive based off of your client, and the market you're in. We are based out of San Francisco, where vacancies are nearly non-existent. It would be extremely difficult for me to convince most of our clients to put money into improving amenities & common area when things fly off the market so quickly. (We just rented a 1 Bedroom, 650 SQFT apartment for $3,300 a month after 1-2 weeks of initial advertising.) Then again, some of our clients aren't as concerned about maximizing profit, and want their building to look as beautiful as possible. Considering you're asking about adding value, I'm guessing this isn't your case.

In another market, where circumstances are correct, you can definitely add value to your apartment by improving the common area. The key is finding a proper budget & comparing it to what you can expect to gain based off of various things regarding the market. If you're competing with a neighboring apartment complex that is similar to yours, and you provide a more comfortable, enjoyable, professional premises, you've given yourself a competitive advantage. If you are in a bad neighborhood, where tenants with money would never live no matter how many new, state of the art eliptical machines you install, it's probably not worth spending a fortune.

What it really comes down to, is knowing your market. Are there nearby, comparable units renting for a lot more than yours? Are there many vacancies in the buildings asking for those high rent prices? Are potential residents going to other nearby properties, even though you are listing comparable units for a cheaper price? This is part of what being a good property is all about, and why it's valuable to have someone who knows the market very well.

So I think I've successfully avoided answering your question at this point, but maybe it gave you a couple things to consider when making your decisions. :unsure: