Improving Apartment Building Health Seen as Way to Attract, Retain Residents

While an apple a day may keep the doctor away for residents, improving apartment building health of apartment buildings is becoming a more exact science that could ultimately improve resident retention.

Building health is no longer based on the soundness of a dwelling’s structural components, but rather the quality of life for residents and employees who occupy spaces within it. The concept is nothing new for commercial spaces but is gaining traction in multifamily housing. Facility managers and operators see good apartment building health as a way to nurture residents who choose to be more sustainable.

Healthy buildings are a component of a worldwide effort to empower wellness, spearheaded by the nonprofit Global Wellness Institute (GWI). GWI educates public and private sectors about preventative health and wellness, which is driving a $4.5 trillion wellness economy that has roots in real estate.

The 2017 wellness lifestyle real estate pipeline included 740 residential projects in 34 countries with an economic impact of $134 billion, according to November 2017 estimates by the Global Wellness Economy Monitor. The U.S. and Asia are leading the effort with 665 properties.

While buildings are being designed to be more eco-friendly, they are also being constructed with the wellness of inhabitants in mind. The logic is that good building health results in a better quality of life, which is becoming a more marketable amenity in multifamily housing.

Simply, good building health helps attract and retain residents.

A perfect complement to sustainable building practices

Building exteriors that dazzle with the latest architectural and structural engineering trends are becoming equally impressive because of what is inside walls and above ceilings. Systems and steps are being added to help prevent mold and moisture issues, provide fresh air, deliver clean drinking water, avoid exposure to toxic chemicals, encourage fitness and support healthy circadian rhythms.

The techniques complement sustainable building practices, establishing what the Global Wellness Institute calls the next trend in real estate. At about 40 percent consumption, global real estate is considered a big user of the world’s energy and contributor to greenhouse emissions.

“A key to health and wellness is that it dovetails with the work we do in multifamily sustainability,” said Juliette Apicella, Director of Sustainability at Gables Residential. “We spend 90 percent of our time inside of buildings. Our building environment is critical.”

As with energy conservation, buildings are being upheld to designations that are seen as subtle sellers to marketability. A building with a good rating for promoting healthy lifestyles is now a desirable commodity, real estate experts say.

New standards becoming more than a designation

Apicella and Pete Zadoretzky, Vice President, Sustainability at Bozzuto Management Co., said at the RealPage 2020 Energy Summit that the new standards are becoming more than just a designation.

Each discussed the benefits for properties that earn Fitwel or WELL Building Standard designations, which are somewhat similar to the green building rating system, LEED.

Designations are awarded to buildings for meeting certain criteria that promote good health—like clean air and water—as well as elevating resident health in other ways. Amenities and proximity to opportunities for exercise and healthy eating, as well as other wellness practices, play a role in determining the building’s health rating. For instance, a residence that is within a walkable community score higher than one that is not.

Fitwel’s global health certification system focuses on 12 key areas to evaluate the evidence-based design and operational strategies that support human health in multifamily buildings. A scorecard evaluates apartment homes, shared spaces, stairwells, outdoor spaces, and other criteria to determine the health of the building.

Scores are tabulated on more than 55 evidence-based design and operational strategies that address a broad range of health behaviors and risks, says the organization.

The designation process takes about 12 weeks and costs around $6,500.

The WELL Standard focuses mostly on occupant health and is similar in theory to the LEED building certification for sustainability. A WELL designation focuses on health categories that directly impact residents, including air, water, light, fitness, nourishment, comfort, and mind. The certification is pricier than Fitwel at $1,500 to $10,000 plus square footage costs.

Both programs send a message to residents that the property owner or manager is looking out for their health in an era where much of the general population spends more time indoors, especially now.

Building health designations expanding into multifamily

According to a survey conducted from 1992-94 by the University of Maryland Survey Research Center for the National Human Activity Pattern Survey (NHAPS), people spend 87 percent of their time indoors. Respondents also reported spending 6 percent of their time in automobiles.

“This is a good way to extend our support to people to be healthier and focus on their well-being,” Apicella said.

Three years ago, the Center for Active Design, the non-profit operator of Fitwel, expanded their certification system to include residential multifamily buildings. In doing so, it became the only certification system to qualify for access to Fannie Mae’s Healthy Housing Rewards financial incentive program for affordable housing properties.

In 2018, AvalonBay Communities became the first residential-only Fitwel Champion company for its apartment community in the NoMa neighborhood of Washington, D.C.

Also, WELL Building Standard now reaches across most rental housing sectors, including conventional and affordable housing.

Inspiring residents to be healthier

Apicella said Gables became a Fitwel Champion in 2020 and has certified six projects and is working on certifying more. Tare working on more.  Each property is designed to promote physical activity, occupant safety, instill feelings of well-being and provide healthy food options, among other Fitwel criteria.

The Ashley Gables Buckhead was Gables’ first community to earn Fitwel certification. The property has a state-of-the-art fitness center with a water bottle filling station and active stair design. The main stair connects relevant floors and is equally or more visible than the elevator to encourage residents to climb rather than ride.

The property achieved a Walk Score of 89 out of a possible 100 for its proximity to dining and entertainment, groceries, shopping, errands, parks, schools, and culture. Ashley Gables Buckhead also has a restorative garden that offers residents and employees a specially designed space to experience serenity.

“One of the greatest areas of impact within Fitwel has to do with site selection,” Apicella said. “The value of walkability in promoting an active lifestyle is scored highly with Fitwel. Strategies with the greatest impact on health and wellness receive more points. To promote stair use, the stairs need to be visible, well lit and have features designed to make the stairwells pleasant and safe. We want to inspire people to be active.”

The leading edge of resident retention

Essex on the Park, a Bozzuto-managed community in Chicago, is a WELL Certified, Class A property but, Zadoretzky said, it’s hard to tell how much of an impact the designation compares to the building’s striking design and extraordinary amenities and service. The Michigan Avenue-located high-rise is in an area that typically commands top dollar for its lakefront views.

But Bozzuto considers Essex on the Park’s wellness designation an amenity in concert with the fitness center and yoga studio, upscale accommodations, conveniences and vibrant city living.

Zadoretzky said apartment building health starts during construction and continues long after residents arrive. Simple best practices like waiting for sheetrock to fully dry before closing up walls help prevent mold and using highly rated filters can ensure cleaner air.

Bozzuto has meticulous maintenance procedures at Essex on the Park to keep the air clean. MERV 13 filters—which can trap viruses, bacteria, and carbon dust—are used instead of the less-efficient MERV 8 filters found in most apartments.

Gables and Bozzuto are on the leading edge of generating resident retention through improving the health of apartment buildings, says Mary Nitschke, RealPage Vice President of Sustainability. A building that feels clean and wholesome is naturally inviting.

Apicella and Zadoretzky say their companies are simply trying to stay ahead of the curve for a lifestyle trend that’s sure to grow.

“I feel residents are going to be asking before long, ‘What are you doing for my health and wellness?’” Zadoretzky said.

Getting started through energy benchmarking and reporting

Nowadays, a property’s health, as measured through sustainability and energy management, is a desirable attribute for apartment operators and residents. Regular and efficient maintenance practices are the low-hanging fruit that puts a building on the path to improved wellness.

As with sustainability, improving property health starts with energy reporting and benchmarking. The widely common practice is the starting point to measure usage and other data to determine if a building is functioning at peak performance. Ultimately, reporting plays a decisive role in receiving designations.

The apartment industry has gained considerable ground in recent years in catching the public’s attention through designations, namely LEED and Energy Star certifications. According to the 2020 NMHC/Kingsley Apartment Resident Preferences Report, 20 percent of respondents said that Energy Star appliances are necessary when renting an apartment.

Nitschke, who will lead RealPage’s 2021 Energy Summit Feb. 24-25, notes a time early in the LEED certifications process in multifamily when renters didn’t specifically seek out apartments that met sustainability criteria although it was really in the back of their minds.

Recognizing building health and wellness is sure to follow a similar path.    

“It resonates with residents, but they can’t identify it with a certification,” she said. “You ask residents why they are moving, and the discussion is the air seems better. Intangibly, a part of them understands it.”

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