Jason Van Sickle wants to be the Henry Ford of apartments.
Van Sickle, a Wichita developer with several projects to his credit, has developed what he calls a prototype apartment building that he plans to spread all across Kansas.
The way he sees it, every city of any size in Kansas – 24 in all – could have one of his buildings. Then, if that works out, he will start building them in other states.
He’s currently finalizing a complex on the east side of Wellington and plans two more for Wichita this year. He expects to have about 500 units in the three projects under construction this year.
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“Every 100 units is about $7.5 million, so it will be a big year,” he said.
Next year, he expects to start six projects and, in 2019, he said, he wants to double that to one a month.
“I’m trying to build a national brand, but I’m starting in Kansas,” he said.
It’s a bold vision.
It’s a little reminiscent of Jack DeBoer, who made a fortune in apartment construction across the nation in the 1960s, then switched to a series of fast-growing, apartment-like extended-stay hotel companies. Van Sickle worked for DeBoer at Value Place a decade ago and saw the approach up close.
“I saw how he ramped it up,” Van Sickle said. “You hire talented people. You turn it into a package deal, and you replicate it over and over again.”
It’s a formula, maybe, but it’s not easy to follow.
But Van Sickle is an analyst by instinct and by training. He has spent more than 10 years studying what to build, how to build it and where to build it.
“When I approach these, I approach it as a formula that can be solved,” he said. “I believe anything can be done with enough work and research and planning.”
Van Sickle is the son of prominent longtime architect Jeff Van Sickle, who retired last year as CEO of GLMV Architecture.
Jason Van Sickle worked for DeBoer at ValuePlace, doing the demographic and financial research needed to pitch the development deals to banks. Later, he worked for Stan Longhofer at Wichita State University’s Center for Real Estate.
And then, when he wanted to learn the practical side of development, he asked Old Town developer David Burk to be his mentor and helped Burk redevelop the old Wichita High School into the Flats 324.
Van Sickle then designed and built the apartment building at K-96 and Oliver and later took the lead developing the new Flats 324 apartment building at Third and St. Francis.
Burk said Van Sickle’s vision seems doable.
“It’s something where if you really analyze and study, you will be able to do project after project,” Burk said. “The key is not having a failure on some of the first projects so you get a good track record.”
Van Sickle describes himself as conservative in finances but innovative in design.
“I wanted to be in the development business, because it’s ripe for innovation,” he said. “And I wanted to be in apartments, because it’s the long-term, least-risky real estate.”
Wichita, he said, has averaged 90 percent occupancy for more than 30 years. It’s not hard to make money on it – as long as it’s built and operated correctly.
“The trouble is they’re complicated,” he said. “You’re building a whole series of mini-houses, and then you’ve got amenities and management expenses on the back end. Financing is easy, but the operations are hard.”
The secret sauce
A one-bedroom apartment at Flats 324 costs $750 a month. But the median rent in Wellington is $555, he said.
By studying ways to cut costs, he said, he can make money in Wellington while providing the same amenities at the lower rents.
He’s done that by owning all of the pieces of the process: development, marketing, design, construction and management. And that’s why he’s taken the time to learn every phase of the business so he can be comfortable with changing it.
“I’m never going to draw the drawings, I’m never going to be the superintendent,” he said.
“But I know a good design when I see it now. … I know a good superintendent. I know now how to run these types of businesses.”
As one example, he said, he has developed videos and manuals for his property managers to use on how to handle technical issues, such as repairing a toilet. As a result, he has less costly, less experienced managers and no maintenance staff.
And by cutting costs, he’s added some valuable amenities: granite counters, free cleaning equipment and supplies, a dog park, an outdoor grilling area, a cafe/clubhouse with free coffee and reduced-price continental breakfast, a pool and a dog wash and grooming area.
Six of the units are reserved for Airbnb rentals ranging from $70 to $110 a night. Tenants can reserve them for guests at half-price.
Demographics are on his side, he said. The share of apartment dwellers is rising. And he’s trying to win the war for this market by having some of the conveniences of home ownership – space for a pet, space for a dinner party, a pool, the ability to host friends and family.
“If you want to attract people, you want (the apartment to be) better, more convenient and even more cost effective than living in a house,” he said.