Published September 20th, 2021 at 11:30 AM2 minute read
By Kevin Collison
The pioneering Second + Delaware development has cashed in by going green, leasing all 276 apartments while still getting premium rents a year after opening in the River Market.
The $71 million “passive house” project upended the traditional stick-built approach to residential construction, substituting 16-inch thick concrete walls with a layer of foam insulation for 2-by-4’s and drywall.
As a result, it uses 90 percent less energy than standard apartment buildings.
“At the very beginning, we did a lot of research on who would like to live here,” said Erin Walker, property manager. “It wasn’t just retirees and empty nesters.
“It’s millennials interested in the passive house approach and how energy efficient it is. We also got feedback about the amazing amenities and how spacious the units are inside and not shrunk down.”
The concept has gone so well that its developer, Jonathan Arnold is exploring building similar-scale projects at two other undisclosed locations downtown. One of his financial backers is Berkshire Hathaway, multi-billionaire Warren Buffett’s holding company.
“They (Berkshire) love it,” Arnold said. “It’s been exceeding their expectations.”
The pace of leasing has outstripped other apartment developments that opened about the same time, Walker said. Second + Delaware hit 80 percent occupancy after six months, 95 percent at seven months and the last studio was leased recently.
The monthly rents are on the higher end of the market with a 589 square-foot studio going for $1,285- to $1,688; one bedrooms ranging from $1,451- to $2,355, and two bedrooms ranging from $1,980- to $3,288.
Those rents however, include all utilities and one parking space.
“It helps you budget,” Walker said. “The retirees and empty-nesters have a fixed income and that’s a huge asset to have one set price.”
Other environmentally-friendly features are a bank of solar panels on one of the buildings that generates 290 kilowatts of electricity for the project. Air handling units pump in 50 cubic feet of fresh air each minute to each apartment.
There are also guest parking spots available for $10 per night and two suites available for residents to host visitors for longer stays.
Walker estimated 40 percent of the residents work from their home and having ample community amenities helped make Second + Delaware an attractive place to hunker down during the Covid pandemic.
“People could get out of their apartments and stay in the community,” she said. “They’re more into investing their money the right way.
“They want to be able to stay at home if something happens and things shut down.”
And of course, there’s the added benefit of residents being able to get their hands dirty rooftop gardening while enjoying the downtown skyline view. There’s also a courtyard the size of a soccer field, large saltwater swimming pool and several community rooms.
The development also organizes a variety of activities for its residents including wine tastings, yoga classes, pilates, self-defense, “sip-and-paints,” and food event such as tamale night.
“On average, in the multi-family industry you get 20 percent of residents doing activities,” Walker said. “We’re getting 60 percent here.”