Builders know more than anyone that people are moving away from their houses, cars and white picket fences in the suburbs into major metropolitan cities. But moving away from a house -- whether it is permanently or only for vacations -- doesn't mean that they want to leave the luxuries of a single-family home. As more people move into luxury high-rises, condominiums and apartments, they want to bring their lifestyle with them.
Ari Supran, residential marketing manager at Lutron Electronics, says that consumers are looking for an amenity-rich, hassle-free lifestyle, which includes custom home technologies -- making the MDU (multi-dwelling unit) market hot. In fact, the National Association of Home Builders' (NAHB) Multifamily Market Index showed a 13.5-point gain (on a scale from 1 to 100) in demand for luxury multidwelling units in the first quarter of 2005, compared to the first quarter of 2004.
Differentiation Is Key
The integration of technology into high-rises is becoming crucial, says George Fallica, owner of Miami-based Cimax USA, a custom electronics installation firm. "If a building doesn't have it, they're not competitive with other buildings," he says. Cimax was the installer for the Trump Palace and Trump Royale buildings in Sunny Isles Beach, Fla.
Jason Sloan, national sales manager, residential systems at Lutron, says that buildings need to stand out, and home electronics can do that. "As [the MDU market] continues to grow, it becomes more important for developers to differentiate their buildings," says Sloan.
Other manufacturers agree. Scott Norder, vice president of business development at AMX, says that the MDU market is on the rise -- literally. "[It's going] nowhere but up -- in more than one way," he says. "We have great expectations for the MDU market."
According to Norder, the MDU market will stick around for some time, especially since it takes time for a building to go up. "It has significant duration," he says. "We see the MDU market as a tremendous opportunity for our channel."
MDUs are also growing in priority at Lutron, where Sloan says the installs are on the way to becoming everyday business. "MDU is becoming commonplace for us," he says. "We're really looking at the MDU space as a challenge."
What Do Builders Offer in Multifamily/Single-family Attached Dwellings?
Structured wiring: 51.9% offer standard
Monitored security: 65.3% offer optional
Mulitroom audio: 68.2% offer optional
Home theater: 52.9% offer optional
Automated lighting control: 58.8% not offered
Home automation: 58.8% not offered
Energy management: 46.9% not offered
Source: State of the Builder Technology Market Study, December 2005
MDUs By Numbers
9.6% boost in estimated dollar value of MDU construction completed in 2004 from the year before, despite the number of multifamily housing starts dropping 1 percent from 2003 to 2004. (U.S. Department of Commerce, Census Bureau)
13.5 points higher on a scale from 1 to 100 was the demand for luxury multidwelling units in the first quarter of 2005, compared to the first quarter of 2004 (Multifamily Market Index, National Association of Home Builders)
42.8% of MDUs built in 2005 had structured wiring (State of the Builder Technology Market Study, December 2005)