How to Audit and Optimize Your Amenity Premiums for Higher NOI

Amenity premiums are typically defined early on in pre-leasing or at acquisition. Largely based on seemingly logical conclusions and trends, premiums are often attached to amenities such as higher floors, more desirable views, and more square footage. And once these premiums are set, they’re rarely looked at again.  

But over time, assumptions age and resident preferences shift. Perhaps a new development across the street blocks your skyline view. Or perhaps your resident and prospect demographic value first-floor access over higher views.

Your top-floor units stay vacant while the first-floor units rarely ever see any vacancy. Eventually, you find that your amenity premiums are no longer aligned with reality, leaving money on the table.

Or, sometimes, an assumption turns out to be wrong. Let’s say you attach a $150 premium to a unit stack that has 50 additional square feet compared to the same floorplan in other stacks. Seems logical. Larger unit, higher rent.

As it turns out, prospective residents find the extra square footage unusable and not a big selling point. Your “premium” units stay vacant longer as residents choose the slightly smaller, less expensive versions – again, leaving money on the table.

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Related: How to Conduct an End-of-Year Audit for Your Multifamily Asset

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The Real Cost of Misaligned Amenity Premiums

When premiums don’t align with renter preferences, you’re faced with an inaccurate representation of how your rents are being accepted in the market. Overvalued units linger and invite concessions. Undervalued features lease immediately, signaling untapped opportunity. 

Every misplaced premium has an impact on revenue, exposure, and even leasing efficiency. Misaligned amenity premiums lead to a more challenging leasing process and extra marketing spend.

This is why your amenity premiums need auditing.

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How to Audit Your Amenity Pricing 

Auditing your amenity premiums is a fast way to uncover hidden revenue. Here’s how to get started.

1. Clean up your existing premiums. Look for things like duplicate amenities and mismatched tags – “top floor” vs. “5th floor”, “balcony” vs. “patio”, “view” vs. “courtyard”, and so on. Once all of your premiums are accurate and uniform, the data is easy to sort and work with.
2. Delete old premiums that have become standard. If hardwood floors or stainless steel appliances are a standard offering, then they are no longer an “amenity” needing to be priced separately.
3. Update premiums that may have changed. Maybe a new construction project changed your “park views” to “parking lot views”. Delete old premiums attached to features that no longer exist.
4. Compare average days vacant for each premium type. Are courtyard views renting faster than expected? Do top-floor units sit longer? Look for leasing patterns that help tell the story of your premium units. When you know what isn’t working, you can recalibrate – reducing or removing stagnant premiums that create friction and testing increases on high-performing features.
5. Monitor your trends and give your pricing strategy room to evolve. For instance, maybe the majority of your prospects own dogs and want to be on the first floor because it offers easy outdoor access. Norentw your hefty premium for top-floor units no longer makes as much sense – but a premium on ground-floor units might. 

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A single periodic audit, however, isn't enough to ensure you’re fully optimizing your amenity pricing. For that, you’ll need to constantly validate whether your amenity assumptions hold up in the market. But manual data hygiene and data analysis can take hours. AI and automation can help.

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Top Pick: How to Find NOI Growth in a Flat Rent-Growth Market

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Stay Ahead of Outdated Premiums with AI and Revenue Intelligence

Maintaining accurate data takes work; acting on that data takes insight. Rentana helps with both.

Rentana’s amenity dashboard helps owners and operators easily sort and review amenity pricing and corresponding leasing data. 

This allows them to spot patterns and flag inconsistencies quickly and easily – and act on insights instantly. From there, Rentana's AI-driven revenue intelligence tool recommends adjustments as trends and demand shift – using predictive analytics to explain how each change will affect NOI.

When owners and operators use automated revenue intelligence, amenity pricing becomes both easier and more effective. 

Once-in-a-while audits of amenity premiums are important, but they don’t solve the underlying problem of “set it and forget it.” Dynamic revenue intelligence does. And it’s how owners and operators turn real-time portfolio data into smarter rent pricing.

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