Smoke-Free Apartments Clean the Air on Tobacco Road [Case Study]

 

An iconic North Carolina landmark for centuries has been the tobacco barn. The traditional barn has long been symbolic of the importance that tobacco has played to the Tar Heel economy since the late 1600s, so much that a North Carolina without tobacco barns, says one historian, would be like Holland without windmills.

Left today mostly for preservationists to embrace, the wooden barns that once air-cured much of the nation’s tobacco stand silently. Slowly, they are being overshadowed by another landmark that is far less iconic but represents a more socially acceptable trend: Smoke-free apartments.

Ginkgo Residential, a property management company based in Charlotte that provides property management services in 10 states, has brought about two dozen smoke-free facilities on line along Tobacco Road in recent years, and officials there say it’s good for business. Smoking has been off limits inside units, offices, and designated common areas with little fallout from residents.

“Customers want it and it’s good for our business because it saves us money,” said Scott Wilkerson, Ginkgo’s Principal and Chief Operating Officer. “It’s cheaper to turn over an apartment that hasn’t been smoked in.”

Smoke-Free Apartments Reduce Property Damage and Turnover Costs

Wilkerson has long been a proponent of smoke-free apartment living and said the aura of Tobacco Road had little influence of the company’s decision to begin converting properties several years ago. One reason was the financial exposure to allowing residents to smoke in apartments, including costs to clean units and physical property damage.

Prior to 2007, four Ginkgo Residential apartments were destroyed by fire resulting from smoking. In one year, the company filed insurance claims on nine fires that were started by smoking materials inside and outside of units.

Also, Wilkerson said Ginkgo properties typically spend $2,000-$4,000 in turnover costs for apartments that have been smoked in compared to $500-$800 for those inhabited by non-smokers. One apartment occupied by heavy smokers was particularly expensive to clean.

“We’ve had a turnover cost as much as $12,000 and the resident paid for it,” Wilkerson said. “We basically had to change out the HVAC system, including the ductwork. It was really, really bad. We even replaced the flooring.”

Residents Support Smoke-Free Apartment Buildings

In 2008, Ginkgo polled residents at properties in Charlotte and Chapel Hill to gauge interest in smoke-free living. Not to Wilkerson’s surprise, the results favored some industry surveys that found 75 percent of residents preferred a smoke-free building and 50 percent said they would pay extra for it.

“In almost every case we get the same answer. Our customers overwhelmingly support a ban on smoking in all apartments.”

Smoking soon was banned inside units, as well as on decks, patios, breezeways, and common areas duly designated. Smoking areas were set up away from building entrances.

“It’s not about smokers, not about the individual,” he said. “It’s about the smoke. We welcome smokers, we just don’t allow them to smoke in our building.”

Smoking to Non-Smoking Transition Takes Time

Once a decision is made to transform a property into smoke-free, Ginkgo goes to its residents well in advance of the start date. Ginkgo utilizes literature provided by the National Apartment Association and other agencies to set the stage. Results of surveys are shared and a timeline that’s usually about a year and a half from start to finish is established.

Scott Wilkerson

“It takes that long because of the process of engaging residents, and then gradually rolling it out as you enter into new leases or renewed leases,” Wilkerson said.

While there were a few who opposed the measures, Wilkerson said the properties haven’t experienced a noticeable loss in business. In fact, more doors have opened for newer residents who he believes are more likely to live at the property longer. Acceptance, he said, coincides with a cultural shift in smoking among adults.

An estimated 45.3 million people, or 19.3% of all adults (aged 18 years or older), in the United States smoked cigarettes in 2010, according to the U.S. Centers for Disease Control and Prevention. In the 1960s, an estimated 42 percent of adults were smokers.

“We will have some non-smokers who will say not to restrict smoking because it’s their right to smoke,” Wilkerson said. “I agree that I can’t tell anybody to stop smoking, but they don’t have a right to subject other residents to secondhand smoke.”

Smoke-Free Policy Enforcement Follows Hotel Industry Policies

As the idea of smoke-free living continues to grow, Wilkerson anticipates that other property management companies will jump on board, much like he predicted in 2006 when making a presentation at the Greater Charlotte Apartment Association.

“There is such a high percentage of residents who prefer and want it,” he said. “When the market wants that, more and more people will do it. They’re finding it’s better for business, residents prefer it, it saves money, and also reduces legal risk. So I think owners will embrace it.”

While rules are in place to encourage that residents abide by smoke-free policies, Ginkgo has seldom had to call out violators. Wilkerson said the company follows policies typical of those in the hotel industry, which has dealt with smoke-free rooms for years.

Violators at Ginkgo properties first receive a verbal warning, followed by a written warning and finally a $250 fine that’s payable to the American Lung Association. Wilkerson says that few checks have been written.

“I’m sure there are folks who have moved out because of it, but the culture is changing,” he said. “It’s one of those things we really haven’t had to address.”

 

 


Contributing Editor, Property Management Insider
President, Ballpark Impressions, LLC

author photo two

Tim Blackwell is a long-time publishing and printing executive in the Dallas/Fort Worth area who writes about the multifamily housing and transportation industries. He has contributed numerous articles to Property Management Insider, and worked as a newspaper reporter in the D/FW area. Blackwell is president of Ballpark Impressions, and publishes the Cowcatcher Magazine. He is a member of the Fort Worth Chapter/Society of Professional Journalists.

  • Keith

    It’s a difficult position for apartments to find themselves in. There is tremendous pressure to ban smoking, yet even the 2010 data shows an estimated 45.3 million people, or 19.3% of all adults (aged 18 years or older) smoke. This is a big section of the population, too large to ignore completely in my opinion.

  • According to the American Lung Association, approximately 70% of the people who smoke want to quit. Smokefree environments help people to stop smoking. That turns out to be good for everyone.
    The other problem is that tobacco smoke will move from unit to unit. It is a health hazard and a potential liability for apartment owners.
    If a resident has a severe addiction to nicotine, there are other products on the market that can be used to satisfy that addiction which will not be harmful to other people.

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