The construction of microunits — residences smaller than 500 square feet — in Boston, San Francisco, Seattle, D.C., and New York City has influenced developers in secondary markets to jump on the bandwagon and prompted groups to create new “microhousing” concepts.

The construction of microunits — residences smaller than 500 square feet — in Boston, San Francisco, Seattle, D.C., and New York City has influenced developers in secondary markets to jump on the bandwagon and prompted groups to create new “microhousing” concepts.

In Orlando, Florida, a subsidiary of Euro Group USA proposes a project that would feature 52 microhousing units — smaller units that share a kitchen. The concept is similar in design to student housing properties, where three or four roommates share a kitchen and living room but have their own bedrooms.

Kehoe North West Properties is about to break ground on a 123-unit project in downtown Portland, Oregon, that will be comprised entirely of microunits. The development is amenity-laden, with a private courtyard, indoor bike parking, exercise room, dog wash station and community room with chef’s kitchen. The project will take slightly more than a year to complete, with an August 2016 opening planned.

The construction time frame for a microunit project is one reason these properties are becoming more appealing to developers. Because a number of these deals will be built via modular construction, projects can be completed roughly a year after groundbreaking, which reduces a developer’s construction cost risks.

The short construction window can also allow a developer to deliver a project prior to a wave of upcoming deliveries. Lastly, projects featuring microunits require a small development site, a glaring positive considering the lack of infill sites in major metros.

In Boston and New York City, government is encouraging and pushing for more microunits via pilot programs. In June, a 55-unit project will be constructed in Manhattan and feature 250- to 360-square-foot units. The dwellings will be prefabricated in Brooklyn and are part of the “My Micro NY” program. Thirty-three of the units will be market-priced, with the remaining units leased as affordable.

Boston’s City Hall is encouraging the development of sub-400-square-foot family units, similar to what is being proposed in Orlando.

While most of the nation’s largest apartment builders will avoid microunits deals, more will incorporate some 700- to 800-square-foot units into upcoming project starts.

Email Erik Pisor.

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