In their unit mix, small apartment buildings are more specialized in bigger units compared to large properties, while also being more affordable. Renters can find value in small apartment property.

1. Access the Industry’s Only Multifamily Small Balance
Research and Insights at arbor.com/blog.
BY ARBOR
Source: arbor.com/blog/small-apartment-buildings-value-urban
Small balance multifamily loans are typically between $1 million and $5 million. Chandan
Economics defines small-cap properties as 5 to 19 units, mid-cap properties as 20 to 50
units, and large-cap properties as larger than 50 units. Both small-cap and mid-cap
properties can fall into the small balance spectrum.
All data is sourced from the American Community Survey (ACS), unless otherwise stated.
ACS statistics are sample-based estimates of the compositional profile of the total
population in the given year of data collection, and include a margin of error.
Average Gross Rent by Unit Mix and Asset Class: 2016
Source: Chandan Economics, American Community Survey, 2016
Two-Bedroom Units in Small Apartment Properties Pack Value for Money
• The average rent for two-bedroom units in small properties was nearly identical to the
average rent for one-bedroom units in large properties.
• Two-bedroom units in large properties commanded a markup of nearly 35% over
small buildings, while studio and one-bedroom units registered a markedly lower
premium of roughly 20% across asset classes.
$1,600
$1400
$1,200
$1,000
$800
Small Apartment Buildings Large Apartment Buildings
Studio 1 Bedroom 2 Bedrooms 3 or More Bedrooms
Unit Size Mix Varies by Asset Class
• Approximately 53% of all units in small properties included two or more bedrooms,
with two-bedroom units alone representing 44% of total inventory.
• Studios and one-bedroom apartments make up a dominant 65% share of large
property units, catering to single renters and two-person households.
Distribution of Units by Number of Bedrooms: 2016
Small Apartment Buildings Large Apartment Buildings
Studio
Source: Chandan Economics, American Community Survey, 2016
50%
40%
30%
20%
10%
0%
1 Bedroom 2 Bedrooms 3 or More Bedrooms
Percentage of Occupied Units within Asset Class
Small Apartment
Properties Pack
Value for Money
with More Space in
Urban Adjacent
Locations
Arbor Realty Trust
In their unit mix, small apartment buildings are more specialized in bigger units
compared to large properties, while also being more affordable. Renters can find value
in small apartment properties.