Who here has instituted an amenity fee at an established property?

Hi Apt Hive, Who here has instituted an amenity fee at an established property? I am looking for some guidance. We are a Class A community rich in amenities. We want to start with new residents and then start a lesser fee for current residents at renewal. Has anyone had luck with this? I know we will have push back but want to be prepared with the right language. 

 

A company I used to work for tried. Unfortunately, it failed. When we started doing the renewals people began putting in notice and we lost new traffic due to it. The area I am in just doesn't do it. We use amenities to basically stick out from the rest. However, we do increase rents a little above what market does and we justify that with we have more to offer. Our biggest arguments were "why do i have to pay for something I'll never use" or "If I am paying for it, I want to use it whenever I want, or invite guests to use".

Oh boy... if it is one thing that class A audience loves it is the annoyance of being nickeled and dimed. That is going to be an educational move for someone.

I have charged “lifestyle fee” of 135.00 monthly so if an amenity closes for any reason residents don’t want a discount. I sell it as community upkeep, resident events, training classes just anything extra you provide them with.

Would you include anything like smart tech, doorstep trash, package service/lockers, etc? I saw many clients have an “amenity fee” which included many of those things but to just be able to use the standard amenities that most class A buildings offer might be a stretch. But if you build value in your community, service level, and product, couldn’t you increase the rent and not charge a fee?

Todd Lohr the problem with “amenity fee” is you can’t rationally explain why it shouldn’t just be called “some arbitrary name because I want more money and I think this will fool you because it is separated from rent fee” to residents. It is a bit insulting to their intelligence.

Miles Scruggs I think it also depends on region. I’m in Phoenix and more often than not, properties are charging a fee. The clients I work with bundle things together like internet, trash, etc. I don’t work on site so I’m not sure what conversations are being had with the residents but properties that don’t charge a fee are in the minority. If you charge a resident $100 and it includes internet, trash, and package services, that seems like a good deal to me. But I think it really depends on where you’re at and what the market is doing.

Todd Lohr I’m not sure the commonality of it changes how that feels. I agree if they have the option to decline internet trash etc then the fee makes sense. If not…. well then it is transparently arbitrary. I mean why have it be for those things rather than “light fixtures fee”? Just because everyone else is doing it doesn’t seem like a great reason to do it. I mean if you called it “kitchen sink fee” at least you are attempting transparency and can initiate good dialog with residents and prospects about value and list prices. It is something you can even highlight in marketing and on your website “Have we told you about our kitchen sink fee? “It is like resort fees in hospitality. We’ve all paid them but it really doesn’t feel good. It feels like a slimy bait and switch where you were told a price per night but then got suckered into extra cost for zero added value on top of what you were already expecting. I believe it just builds underlying resentment.

Why not just charge in rent what you want folks to pay? There isn’t a single person in the world who likes being nickeled and dimed.

Lee Tifani well once you step down a bit the residents become more price sensitive and appreciate being able to save on things they don’t value. They consider it less nickel and diming. The upper end of the demographic just view it as annoying and transparently a money grab unless it restricts access to a limited resource to those who actually highly value it.

Sure

My company moved forward with a $55/month amenity fee. Effective immediately for new move ins and upon renewal for all residents. We had backlash and yes a few people left because of it but at the end of the day it’s gone well so far! I’m at a class B- in a suburb of Charlotte.

Know what most people hate? Going to a nice hotel, paying a premium for a room, then being charged a daily "amenity fee" for amenities they wont use! Amenities at hotels are like at your properties; pool, hot tub, gym, etc. You built a class A so you must put in those amenities. And, most don't use them. So how can you justify hitting every resident for the fee? It's a rip off, I hate our industry ever got In volved with them. If your place is that great, raise the rent. Don't get me started on Admin. Fees. Lol

It's such a greedy thing to nickel and dime people who are already struggling with astronomical rents. You better have a hair salon, dog groomer, mini convenience store, laundry service, etc, and not just basic things like pools, spas and grills.

I feel you should do a required survey of all residents to see how many people actually use what amenity. Then charge for it. The others I'd do away with . Or find what interests most residents?

Call it a “resident services fee”. If another COVID pandemic happens and you have to close amenities down again, many angry residents will complain about paying an amenity fee for closed amenities.