Welcome to the second half of 2021! Homebase sits at the intersection of several rapidly-changing sectors, a few of which aren’t commonly kept up with. Let’s change that! Here’s a link-heavy recap of the first six months of this historic year across the industry landscape that always keeps us on our toes.
Multifamily back in stride
The clouds around the outlook of commercial real estate (CRE) started clearing in the first half of 2021, with the industry believing they have a stronger grip on demands & trends going forward.
The CRE sector that continues to shine is our core focus of multifamily (aka apartments), which continues to lead performance in many markets.
Housing, in general, has had a record year in terms of value, especially for single-family homes. Not to mention the single-family rental (SFRs) market! Is homeownership becoming a thing of the past?
Yet in the world of rentals, evictions have come to center stage during COVID – relief came, but now that programs are winding down, where does affordability head? Many signs point to this next section.
Construction pressure points remain
Unfortunately, we (the United States) are not doing very well on the controllable side of the housing equation, supply. Frankly, we are not building enough homes, fast enough.
Many reasons have converged to make it more difficult than ever to get projects going. Material costs are going up (you heard about lumber!). Labor costs are going up, and participation has been down. Cities are letting vocal neighbors shout down new projects.
With these factors in place, the equation to develop new housing is difficult – and it only gets harder for units below market rate rent. But there are many signs of positive momentum!
Material prices have drawn back from spikes and labor, while still costly, is starting to come back. Modular housing is continuing to mature, and we’re even getting to 3D-printed homes.
Additionally, YIMBYism (yes in my backyard) is growing in support across the US, attempting to break down barriers of zoning and other governmental processes.
Not to mention several other waves happening within the world of CRE construction that look to be lasting. One being WELL bursting onto the scene (you’ve probably seen the celebrity-heavy commercials) to certify the “wellness” + health of commercial buildings, a LEED sibling of sorts.
PropTech keeps getting bigger
Feel like you know a bit more about the latest in the world around you? Good, let’s jump into how it’ll interact with that always-updating “phone” in your pocket (and on your wrist… and your face?) – we call it PropTech.
As the physical world of buildings continues at a steady pace, the world of PropTech is absolutely flying. In these first six months, we’ve seen public exits by several big names + some of the largest raises by VCs in the space yet.
You’ll notice these names include companies that we are building this category alongside – a big congratulations to both Latch (via Tishman Speyer SPAC) and SmartRent (via Fifth Wall SPAC).
Then there are the devices. IoT continues to take over your home and is a big focus from the likes of Google & Amazon. How many did you add during the last year?
The hottest buzzword of the moment is metaverse, relating to a few different views on how an encompassing digital universe exists alongside the real world (or doesn’t). Including 3D digital twins, augmented reality experiences, crypto IDs & more.
Speaking of crypto, you’ve probably heard the term “fiat” more than ever. Are rent payments looking at a new way forward? Maybe it’s crypto (NFTs anyone?) or a rent-specific credit card to help you buy a home. We’ll be keeping our Homebase Pay up-to-date, wherever things go.
Access control reinvention hits primetime
Then there’s our favorite category of PropTech undergoing a digital reinvention – access control, aka that lock on a door that keeps you out or lets you in.
Access control took on many new forms and much greater prominence than ever before during the COVID pandemic. Whether it was needing a digital reservation almost everywhere you went or jotting down your contact information when you did go somewhere, there’s more verification happening than ever.
This means access control has more responsibilities than ever in CRE properties, all enabled by digitalization… so let’s start calling it a platform.
An access control platform that can integrate with your security cameras, a platform that keeps up with the latest digital key standards from Apple (like widgets) & can make you trust grocery delivery directly to your fridge. Oh, and there’s the ability to do self-guided tours and technical stuff, like instant revoking of access, plus more.
Idyllic, right? We’re getting there. But where are we hoping to see more progress in the access control world? Wrangling all those packages! Buildings are receiving more than ever (thanks e-commerce!)… We’re working to find the fix.
Sharp and gradual changes for work & cities
Work has never been more location-flexible and employers are starting to lean into remote citing improved performance (& people might just quit), as the rush back to the office turns into a stroll.
In multifamily, more residents are working all day in their apartments – making full-building high-speed WiFi an essential need, and not just during those Netflix hours. Don’t be surprised if potential residents are running speed tests during tours. Look out for resident rental office space to be included in new buildings.
While the work-from-home (WFH) trend won’t be ending soon, it’s notable that transit is coming back – largely because most people can’t work from home.
Kept inside all day, many people still want to get out of the house – often rediscovering the area around them in new ways (read: not in cars). Cities are adding bike lanes, reevaluating highways & focusing on walkability – aren’t all the parklet patios great?!
This human-scale infrastructure is that it’s often pro-climate, aligning with the stated priorities of many cities. Not to mention density, give us more!
–
We’d be remiss to not mention our “Homebase” of Kansas City extending our streetcar, moving forward on large developments & building better mobility! Pretty cool – did we mention we are hiring?
Hope you found a few insights into what’s to come – do we have you interested in the Future of Living now?!
