New Apartments Being Constructed in NW Portland

News of a new downtown  apartment complex being built broke yesterday when the Daily Journal of Commerce reported yesterday that a new 90-unit apartment building is beginning construction in NW Portland.

Price Reduced! Senior Apartment Complex - With Great Cash Flow! $2.4 million

The Albany Court Apartments are a 71-unit senior apartment complex with recent substantial renovations. Converted in 2008 from assisted living to senior apartment - kitchens were added to all units and all new electrical service was installed along with new cabinets, appliances,
carpet, flooring, and double-pane windows. Common area amenities
include a library, fireplace, reception desk, private dining area,
activity and exercise rooms, beauty salon/barbershop, chapel, garden
courtyards, administrative offices, and a commercial kitchen leased for
additional income. Estatimated net cash flow of over 11%. Fully fire
sprinkler protected. Price reduced $200,000 to $2.4 million. For additional information click here to download the marketing flyer.

Summer 2010 Barry Apartment Report: "Slow Transition From Great Recession to Recovery.”

In his Summer 2010 Apartment Report, Mark D. Barry’s latest report predicts:

• Income will remain flat
• Some increases in utility expenses
• Vacancies will hold around 5% 
• Values will remain stable 
• The next two years will experience a better sales environment
• Permits for only 600 to 800 new apartments will be issued in 2010

Vacancies & 2012 Shortage
Barry expects that the rest of 2010 will be “…a year to concentrate on keeping your tenants happy, and holding on to what you have.” He predicts that apartment vacancies should fall between 4.75%-5.25% and says the close-in urban market will remain in balance with higher vacancies concentrated in more expensive units and more outlying suburban areas. And, over the next couple of years, Barry says apartment vacancies will “rebound quickly” as the economy turns around and expects an apartment shortage by 2012.

Values
Apartment values are anticipated to remain stable for the balance of 2010 due to low interest rates and stable income despite some increasing expenses. Typical cap rates of 6.50% to 7.75% for suburban properties and 6.00% to 7.25% for urban properties.

Sales
“The next two years will be a far better environment for apartment sales. This will be due to many owners getting better educated on values, some capitulation on the part of sellers, motivated sellers who need the funds, seller motivated by possible increases in capital gains, and buyers who sense that we are close to a bottom.”

RealFacts: Rental & Occupancy Rates Rise

A recent report by RealFacts indicated rents are rising in nearly every market across the country in Q2 of 2010.

Read more: Portland rental rates, occupancy increase - Portland Business Journal

Apartment Market Surprises Investors With Lack of Distress

Outside of Nevada, Arizona, and Florida, only a trickle of distressed properties have come to market.  What's going on?

Read More > > >

N.A.R. Predicts Stronger Multifamily Market for 2011

According to the National Association of Realtors' (NAR) latest report, the Q1 Multifamily vacancy rate was 7.3% down slightly from 7.4% in Q4 2009. NAR predicts vacancies will be down to 6.3% nationally by Q1 2011 as absorption rates climb.

NAR also predicts that in 2010, 145,600 multifamily rental units will be absorbed, followed by an absorption of 214,500 in 2011. It anticipates that negative net absorbtion will only occur in Q4 2010 when 39,000 units come to market, representing the last of the major developments funded before the 2008 credit freeze.

NAR predicts multifamily rents will regain 1.2% in 2011, having fallen 3.6% in 2009 and 1.5% this year.

Generation Y - Multifamily's Bright Future

Real Estate Forum magazine reports this month that Generation Y is expected to increase demand for apartments that exceed current supply: "the number of new apartment communities developed will still be well short of what will be needed to both replace obsolete units and accommodate new and existing renters."  See "Multifamily Has a Bright Future"