• Shrinking the floor plate means removing things like kitchens.
  • Smaller units may appeal to older customers as well as younger.
  • Location is its own amenity.


From left: James Potter of Kauri Investments; David Adelman of
AREA Real Estate; and Mark Riedy, executive director of Burnham-Moores
Center for Real Estate at University of San Diego.
When it comes to “micro” apartments, a Bellevue, Wash.-based developer may be building them smaller than most anyone else. Kauri Investments has done six micro projects of varying sizes in and around the Seattle area. While each is somewhat different, the average unit size is just 100-150 square feet, James Potter, Kauri’s chairman, said at ULI’s annual spring meeting in San Diego.

The buildings have centralized kitchens, where occupants share pots and pans provided by the developer which also manages the properties. But they have to bring their own plates, bowls and silverware.

The units themselves have small kitchenettes – no stove, no refrigerator, just a microwave – and even smaller bathrooms with just a shower and a toilet. A sink is in the kitchen, not far away. And there rarely is any parking.

“It not about crunching down old plans,” the developer said. “You’ve got to take things out.”

If his projects harken backed to the day of SROs, dormitories, or boarding houses, that’s fine with him. After all, that’s how people were housed prior to the 1950s, he pointed out. In his discussion, Potter warned against getting into labels, or as he said it – “Don’t get caught up in words.”

Potter said his units are about his customers: what they want balanced against what they can afford. Kauri’s properties tend to attract an eclectic mix of tenants, from people who can’t afford much to executives who want a small place near their offices where they stay a few nights a week.

While they might work in the suburbs, he says they’ve been successful to date largely because they are in urban, walkable locations within easy reach of transportation and retail. “Our amenities are the community we live in,” the developer said.
David Adelman of AREA Real Estate in San Antonio is building more conventional apartments. But he, too, is moving down the square footage ladder.

The 247 units in his first project, a downtown San Antonio mid-rise, averaged 726 square feet. But now he’s looking at a 113-unit project in which the units will average 588 feet, but 10 will be only 380.

“I’m looking at lifestyle trends and I’m working my way down,” said Adelman, a self-proclaimed “outsider” who started his real estate career in the industrial sector and had no preconceived notion of what apartments should be.

Unlike Kauri’s properties, AREA’s are amenity laden. One has two pools which are always full, several courtyards suitable for cooking and the like and dog parks that have become an incredible social feature. Food trucks several times a week are an additional feature.

“If we’ve struggled with anything, it’s how to manage these amenities,” said Adelman, “We’re not just pet-friendly, we’re super pet-friendly.” The 307-unit property is home to 80 pets, according to the developer.

Inside, the units are fairly stark. Tenants get a Pullman-style kitchen with all the features but little else. The idea, said Adelman, is to allow residents to use and decorate their limited space as they see fit. “People will figure out how they want to use their space,” he said.

AREA’s tenants are mostly male, but more and more women are signing up. They’re largely single and somewhat older than the 20 to 30-year olds Adelman originally thought he would attract.

AREA’s properties offer parking, though Adelman says he has to fight tooth and nail to keep parking requirements down. It’s not an easy issue, Potter agreed, because people fear new residents will be more competition for an already limited number of spaces.

But, the Seattle developer points out, only 20 percent of his tenants even own cars, and his company helps those occupants find places to store their automobiles elsewhere.