This presentation discusses; the changing rental preferences of aging millennials, renter commute trends, and vehicle ownership rates in the multifamily market.

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The Changing Rental Preferences of Aging Millennials 2
Renter Commute Trends: Growth in Walking, Cycling Outpace Driving 6
Vehicle Ownership Higher Among Small Building Renters 9
1
Table of Contents

3. The Changing Rental Preferences
of Aging Millennials
ALEX Chatter
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The impact of Millennials (born 1982-1999)
on the rental market is only just beginning
to fully manifest itself, as the youngest of
this cohort enter adult life.
As shown here, according to data from the
American Community Survey (ACS), while
adult Millennials (18 years or older)
comprised a 22% share of the overall
American population of 321 million, they
form a significantly higher share of the
nearly 39 million apartment renters
in 2015.
At the same time, considering price
differences across apartment building
types, Millennials represented a higher
share of small building renter population at
36%. This figure is 5% higher than their
share in the more expensive large
buildings.
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey
Millennials as Share of Population Segment
As of 2015; Adult Millennials Born After 1982
The Changing Rental Preferences of Aging Millennials
36%
31%
35%
22%
0%
8%
16%
24%
32%
40%
Small Building
Renters
Large Building
Renters
All Apartment
Renters
US Overall
Population

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Going deeper, segmenting the Millennial
market by younger (18-25 years) and older
(26-33 years) renters shows differences in
building preferences, which are likely to
play out fully in the coming years.
As shown here, younger Millennials
comprised 18% of all small building renters,
only 1% lower compared to their older
counterparts.
This difference gets wider in large buildings
with higher rents, where the older
Millennials, further into their careers, come
in 3% higher in the overall renter share.
Young and Older Millennials, as Share of Population Segment
As of 2015; Adult Millennials Born After 1982
The Changing Rental Preferences of Aging Millennials (continued)
19%
17%
11%
18%
14%
11%
0%
5%
10%
15%
20%
25%
Small Building
Renters
Large Building
Renters
US Overall
Population
18-25 yrs 26-33 yrs
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey

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Adult Millennial renter growth continues to
outpace overall apartment demand, even
as market observers brace for the
impending generational shift toward the
post-Millennials (born after 2000).
As shown here, Millennial apartment
demand is expanding at twice the pace of
the overall renter growth across all
apartment types — at an annual rate of
7.2% in small buildings and at an even
higher rate of 11.5% in large buildings,
fueled by older Millennials.
Small building developers and property
managers will benefit from a more nuanced
understanding of the exceptionally diverse
Millennial demand segment, including age,
as explored here.
Growth of Millennials By Population Segment
Average Annual Growth Rate 2014 to 2015; Adult Millennials Born After 1982
The Changing Rental Preferences of Aging Millennials (continued)
7%
12%
7%
4%
5%
1%
0%
3%
6%
9%
12%
15%
Small Building
Renters
Large Building
Renters
US Overall
Population
Millennials All Age Groups
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey

7. Renter Commute Trends: Growth in
Walking, Cycling Outpace Driving
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In recent years, cities have witnessed the
rapid adoption of new technologies such as
ride-sharing and on-demand taxi services.
Such changes — in combination with a
renewed focus on transit expansion — have
the potential to transform the residential
location options for workers.
However, as shown here, an overwhelming
77% share of all workers living in small
apartment buildings in 2015 drove to work.
In large buildings — which tend to be more
centrally located — this figure was 62%.
On the flip side, around 21% of large
building residents took public
transportation to work, double the share of
workers living in small buildings. In large
buildings, another 9% walked to work,
compared to only 6% in small buildings.
Commute Choice of Renters Living in Apartments
As of 2015; Share of Workers within Asset Class by Mode
Renter Commute Trends: Growth in Walking, Cycling Outpace Driving
77%
12%
5%
1%
5%
62%
21%
9%
1%
6%
0%
20%
40%
60%
80%
100%
Car Public Transport Walked Biked All Other
Small Asset Buildings Large Asset Buildings
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey

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Driving is the predominant mode of
commute overall. Yet when examining just
car-owners, the data indicates a faster shift
to other commute modes among small
building residents.
As shown here, the share of car-owners
driving to work grew at an annual rate of
3.6% in small buildings, compared to 4.2%
among large building residents.
Public transportation use grew at 4.8%
among small building car-owners, which
was faster compared to large building
residents.
Although starting at a very small share,
biking grew at an even faster pace among
small building car-owners at 5.5%,
Growth in Commute Choice of Workers Owning a Car, Living in Apartments
As of 2015; Share of Workers within Asset Class by Mode
Renter Commute Trends: Growth in Walking, Cycling Outpace Driving (continued)
3.6%
4.8%
3.4%
5.5%
7.2%
4.2% 4.1%
7.5%
6.7%
9.2%
0%
2%
4%
6%
8%
10%
Car Public Transport Walked Biked All Other
Small Asset Buildings Large Asset Buildings
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey

10. Vehicle Ownership Higher Among
Small Building Renters
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Larger shares of car ownership among small
building renters should come as little
surprise given the more dispersed location
of small properties across both urban and
suburban locations — especially compared
to the predominantly downtown oriented
large buildings.
Only 22% of small apartment building
households did not own a vehicle. In larger
buildings, this figure rose to nearly 40%.
Nationally, this share stood at only 9%,
which makes sense given that
approximately 63% of householders own
rather than rent.
Among small building households, 53%
owned just one car, while another 25%
owned two or more cars.
Car Ownership by Building Size
As of 2015; Households Living in Apartment Buildings
Renter Commute Trends: Growth in Walking, Cycling Outpace Driving
22%
53%
25%
39%
45%
16%
9%
33%
58%
0%
15%
30%
45%
60%
75%
No Car One Car Two Cars or More
Small Asset Buildings Large Asset Buildings US Overall
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey

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In a reversal of the long-term decline trend,
households without vehicles registered a
small increase across both small and large
apartment buildings. Some observers
attribute this slow growth to the rejection
of the car culture by Millennials — though
that is a trend that’s up for debate.
Technological disruptions in the auto-
industry, such as the introduction of self-
driving cars and car shares, could further
dampen ownership rates. For property
managers, this technology could lead to a
shift to electric and hybrid vehicles, which
could require new vehicle amenities in
apartment complexes such as
charging stations.
Growth in Car Ownership by Building Size
2010 to 2015; Households Living in Apartment Buildings
Renter Commute Trends: Growth in Walking, Cycling Outpace Driving (continued)
1.0%
1.6%
3.6%
1.3%
2.6%
4.2%
0.2%
0.4%
0.8%
0.0%
1.2%
2.4%
3.6%
4.8%
6.0%
No Car One Car Two Cars or More
Small Asset Buildings Large Asset Buildings United States
Source: ALEX Chatter, Chandan Economics, U.S. Census American Community Survey

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