Portland OR Q1 Apartment Building Investments Now Posted.
Here are some interesting transaction statistics for 1st Quarter apartment building investment transactions:
- Average price per unit was up 11% from Q1 2011
- 6.86% was the average cap rate, vs. 7.07% in 2011
- 77% of properties sold had between 5-50 units
Click on the image to see the list of Q1 apartment building investment sales in Portland:
For more on PDX apartment building investment see City Rents Rise As Buyers Wait Out Housing Bust from Joseph Bernard Investment Real Estate.
Now you can watch the Apartment Building Investing Cycle Unfold In Real Time- Much easier than deciphering technical stock charts!
Filed under: Apartment Building Investment Cycle, Multifamily Design & Development, Multifamily Investments
Successful apartment building investing is about knowing where and when to buy and when to sell. The apartment building investment cycle sends very clear signals to those paying attention and one of the biggest and clearest is when existing properties begin to sell for more than the cost of building new apartments. As I mentioned here this line was crossed about a year ago in the Seattle market and now we can see how the peak is formed, when every developer and their brother starts building new apartments.
From Bloomberg:
The biggest surge of Seattle-area apartment construction in a quarter century is threatening to undercut the growth in rents. Seattle went from “dead last” in rent increases three years ago to 13th out of 88 markets last year. “We went from almost a desert to a big pipeline” in two years, said David Young, the Seattle-based managing director who oversees western U.S. apartments for commercial broker Jones Lang LaSalle Inc.
Encouraged by hiring at local employers such as Amazon.com, Boeing and Nordstrom, developers are building almost 10,000 apartments in Washington state’s King and Snohomish counties, Three- quarters of the total are in Seattle, with 4,619 of those units in or near downtown.
Dupre + Scott Apartment Advisors Inc. said the building boom may last through 2016.
“If in fact we come to market when there’s excess supply, we’ll just have to be aggressive on rents,” said Read more
Apartment Building Investment In Seattle, here’s the good news- video
Filed under: Apartment Building Investment Cycle, Multifamily Design & Development, Multifamily Investments
Seattle Apartment Building Investment update video Translation: We would never overbuild or get started too late in the apartment building investment cycle 
Is the Dallas/Fort Worth Apartment Building Investment Cycle Peaking or just taking a breather?
Filed under: Apartment Building Investment Cycle, Multifamily Investments
In their RECON report The Real Estate Center @ Texas A&M quotes The Dallas Morning News on apartment building investment in the DFW market:
“Apartment leasing in Dallas-Fort Worth dipped for the first time in over two years.
Net leases fell by 270 during first quarter 2012, with most of the declines occurring in the northern suburbs.
Greg Willett of apartment analyst MPF Research believes the slight dip is nothing to worry about.
“I don’t think one quarter of slight resident loss should be viewed as a big deal, especially when demand in first quarter usually is pretty mild anyway,” he said. “The job numbers still look good, and a comeback for the for-sale housing sector actually could drive them higher.”
The North Texas area has added about Read more
Attention apartment investors: An entire generation has lost its interest in homeownership.
Filed under: Multifamily Investments, The Economy and Current Affairs
When it comes to apartment building investing one has to consider homeownership as competition for ‘our’ residents. But now in a post that’s part of his series on where the housing market stands today, Barry Ritholtz over at The Big Picture blog has this to say:
“There are many good reasons to believe that the 5.5 million foreclosures we have so far brings us only to the 5th inning of this real estate cycle. We are, in my best guess, barely halfway through the full course of foreclosures. By the time this entire unwind is complete, the United States may end up with a total of 8-10 million foreclosures. 
Therein lay the Psychology factor. Once we begin to see an increase in foreclosures, the data is going to be far less accommodating. Monthly prices start falling, fear levels rise, and a viscous cycle could begin. Consider the recent college grads, who typically form each wave of first time buyers. From their perspectives, this whole housing thing must seem absurd. Their observations about home ownership is not the American Dream, but rather, a nightmare. Yale professor Robert Shiller worries that we have lost an entire generation of potential home buyers.” [Emphasis mine] BTW, Shiller is co-author of the Case-Shiller index, a measure of the state of the housing market. Read more
National Apartment Building Vacancy Plummets, Defies Fourth-Quarter Seasonal Slowdown says report.
Filed under: Multifamily Investments, The Economy and Current Affairs
Marcus & Millichap’s latest report on Apartment Building Investment called “The Outlook” is just out today. In it they cover the usual national multifamily trends; rents up, vacancy down, economy slowly recovering, jobs growing but could be better. Then they take it a little deeper with these points (bel0w) then flesh it all out with charts demonstrating that things are really picking up for apartment building investors.
Here’s the exec sum:
- Expanding Production Capacity Signals Stronger Job Creation.
- Sustained employment growth underscores traction in the economy.
- Apartment demand surges, completions sink to new lows, and a sweeping recovery matures into an expansion cycle.
- Vacancy rates tighten across markets and asset classes, moving the sector into expansion.
- Foreclosed homes and government-sponsored REO-to-Rental program offer rental alternatives to apartments.
- Cap rate arbitrage and stabilizing operations create a compelling investment thesis for opportunistic and value-add strategies.
- Stronger job growth and household formation will provide a steady source of new entrants to the multifamily rental market. Read more
Where is Your Multifamily Market In The Cycle? Nice interactive map. Via @UrbanLandInst
Filed under: Multifamily Investments, The Economy and Current Affairs
Is Apartment Building Investment in the up cycle in your market? Job growth is the most important leading indicator of the market cycle. Check out the cool interactive map through Q4 2011 from The Atlantic here: MetroMonitor Economic Performance Maps
Seattle Multifamily Vacancy at 4.2% Says Dupre + Scott, average rents over $1,500 too.
Filed under: Commercial Real Estate, Multifamily Design & Development, Multifamily Investments, The Economy and Current Affairs
For more on the Seattle area apartment building investment climate see the Seattle Times article here: Apartment rents likely to keep rising through 2012
Hat tip: Paul McFadden
Getting Inside the Head of Today’s Online Renter, multifamily report now available.
Filed under: Commercial Real Estate, Multifamily Design & Development, Multifamily Investments
From my friend Heather over at Behind The Leasing Desk Consulting: “fact: I ♥ Satisfacts! Check out their new report on the mind of the online renter for some great insight into what your potential residents are thinking.”
From Satisfacts: “We asked, and now it’s ready for YOU. Getting Inside the Head of Today’s Online Renter is the most comprehensive analysis ever conducted in the industry on the impact of technology and social media on apartment marketing and operations.” Get the report here
Multifamily is best Commercial RE sector but…. Video from Starpoint CEO Paul Daneshrad
Filed under: Commercial Real Estate, Multifamily Investments
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