ST. PETERSBURG — While most renters historically have been in the 20 to 40 age group, baby boomers now make up the fastest-growing segment of the U.S. rental market.
It's a market a Miami company hopes to tap in downtown St. Petersburg.
American Land Ventures is nearing the start of construction on a 23-story, 219-unit tower on Second Avenue S designed to appeal to active boomers who can afford but don't want to be tied down by a house.
"Essentially, I've designed it for myself,'' said Granvil Tracy, the company's 63-year-old president. "When I was growing up there was a stigma to rentals. That's gone away.''
American Land is no stranger to rentals or to downtown St. Petersburg — it built the 18-story, 358-unit AER on Third Street S next to a Publix shopping center. That tower sold in January for $126 million in Tampa Bay's biggest apartment deal ever.
Around the time the AER sale closed, American Land paid $5.8 million for the north half of the block bounded by Second and Third avenues S and Fourth and Third streets. That will put the company's new tower directly across from Avanti, a 326-unit apartment complex that just opened, and catty-corner from Beacon 430 with 326 rentals.
Isn't it risky to build 219 more apartments so close to two big new projects? Tracy says it isn't.
"The design of this building and the whole presentation is totally different than what is in the market currently,'' he said, referring to Avanti and other complexes geared toward millennials ages 22 to 37.
Tracy said American Land realized that older people also were looking for upscale rentals based on what happened when AER opened two years ago. Roughly half of the units, especially the larger, more expensive ones, were leased to tenants over 40.
"When we dug into that, we found on a national basis that the 40-plus age group is growing two or three times the rate of the traditional rental market,'' Tracy said. "It's the baby boomers like myself that decided they don't want to own more real estate, they prefer to stay liquid, they prefer to stay flexible. If they can find a rental approaching condo sizes and condo finishes, they will go ahead and rent.''
Tracy said his company's new tower will be a "lot more subtle, a little more elegant'' than nearby apartments. It will include a large pool deck, a rooftop lounge with cabanas and fire pit, an outdoor bar, a spa and a fitness center.
"We felt that this (40-plus) market wants more things to do on site,'' Tracy said. "For this building, people are also going to appreciate the proximity to the waterfront and waterfront parks, the museums and the Publix across the street.''
Apartments will average 1,000 square feet, with the larger ones about 1,200 square feet. Rents will be similar to those in nearby complexes, which run about $1,500 a month or higher for a one-bedroom unit.
American Land hopes to get its building permit within the next few weeks and to start construction by year's end, Tracy said. As of yet, the project doesn't have a name.
"It's bad luck,'' he said, "to name a building before it's out of the ground.''
Contact Susan Taylor Martin at firstname.lastname@example.org or (727) 893-8642. Follow @susanskate.