Her choice: a 650-square-foot studio apartment, which she purchased in 2012 for $600,000; she spent another $200,000 on renovations, including the kitchen and bathroom.

Instead of having eight one-bedroom apartments priced at $600,000 each for $4.8 million, the developer might choose to have 10 studio apartments at $550,000 each for $5.5 million.

In Hollywood, the new residential proposal calls for 734 apartments in two towers of 34 and 38 stories, said Rob Kane, a senior executive vice president at Lincoln Property.

But even in Columbus, Ohio, the fifth least expensive city, studio rent jumped by nearly 35 percent, from $625 to $849. Renters in only two of the 50 largest U.S. cities — Fresno, Calif., and ...