Real Estate News

Developers court millennials in Tacoma ‘micro unit’ projects

A rendering of iStudio North, a three-story development on Junett Street featuring apartments as small as 419 square feet.
A rendering of iStudio North, a three-story development on Junett Street featuring apartments as small as 419 square feet. Courtesy

Three Tacoma developments, including two featuring so-called “micro-apartments” in South Tacoma, could break ground this year.

The two micro-developments will feature 60 apartments of 450 square feet or less. The smallest will be 419 square feet — about the size of three parking places.

Backers of the three buildings want to court millenials by adding building-wide, high-speed Wi-Fi, bike lockers for each unit and affordable rents in a small living space.

“I envision two UW students who want to game when they get home and they don’t want any lag time,” said developer Steve Novotny, who is partnering with Roy Kissler through their development company, SNR Northwest Properties.

The pair is nearly ready to open a 94-unit apartment building called Macintosh Court in Tacoma’s South End. Its units are comparatively larger — 560 square feet for a one bedroom and 920 square feet for a two-bedroom, two-bath unit — than the new buildings they propose.

Tacoma city code allowing micro units — or “efficiency multifamily dwellings” in city planner parlance — has been around for years. Under the designation, apartments can be as small as 250 square feet and as large as 450 square feet.

All three buildings will have rents at around $2 per square foot, Novotny said.

▪  iStudios South, south of the Tacoma Mall on a vacant lot at 2515 S. 48th St., will feature 45 units ranging from 419 to 672 square feet in two separate three-story buildings; 33 units will be under 450 square feet.

▪  The 33-unit iStudios North will feature slightly larger spaces. Units in a three-story development will include apartments from 419 square feet to 672 square feet on what is now a vacant lot on South Junett Street near South 38th Street. The units will be in a single three-level building. Of the 33 units, 27 are under 450 square feet.

The micro-units are required by city code to include a refrigerator, stove, closet, kitchen sink, and a separate bathroom including a toilet and shower or tub. Novotny said each unit also will have a washer, dryer and dishwasher.

The developments will take advantage of a city code that allows small apartments to swap out parking spots for bike lockers, Novotny said. The city defines such accommodations as between 250 and 450 square feet.

▪  Though not including micro units, Kessler and Novotny are working on another building on McKinley Hill overlooking the Tacoma Dome. Overlook Place, a 12-unit, four story development with sweeping views of Tacoma’s Tideflats and Mount Rainier, will be built on a lot near the corner of East McKinley Way and East G Street. The smallest units start at 598 square feet and will populate the bottom floor, with two bedroom, two bath units of 891 square feet toward the top to take advantage of the views.

Novotny said he wanted to build micro-units in Tacoma after reading about their success in Seattle. He looked at the Tacoma market and examined the demand in his existing developments and saw room to grow in the small-unit market.

“The demand for the small units was twice as much for the double units,” Novotny said. “We realized there’s this whole market of people out there that would be more than happy to have a smaller unit if it was located properly.”

The units may provide relief in a rental market that continues to climb.

“The concept of (efficiency multifamily housing) is to try and provide a type of housing which is less expensive to construct,” said city planner Elliott Barnett. “It’s a market-based way to get more affordable housing.”

April’s median monthly rent — where half pay more and half pay less — for multi-family units in Tacoma was $1,072. That’s 11.7 percent higher than April last year. Seattle’s rent for the same month was $1,850, 6.9 percent higher than last year, according to estimates from real estate data firm Zillow.

Kate Martin: 253-597-8542, @KateReports