Seattle Times: A New Housing Crisis - and Not Just in Seattle

An article in today's Seattle Times blames an inability to afford starter homes as one key reason behind a new housing crisis.  Read more. 

Is the Seattle Apartment Market Going Bananas? Part 2 of 3: Rents

Dupre & Scott's second video of a three part series on the Seattle apartment market. The videos and information are based on a presentation given to the Seattle City Council in mid-March. Part 1 discusses development and Part 2 discusses rents and vacancies.

 

Video - Is the Seattle Apartment Market Going Bananas? Part 2 of 3

 

 

Rents in Seattle Beginning to Moderate

The Puget Sound Business Journal reports that Seattle has more apartments available than it has in the past five years, and that rent increases are easing. Read more.

Clyde Holland Testifies Before Congress On Housing Crisis | NYC Imposes Additional Mandatory Inclusionary Zoning

Pacific Northwest developer Clyde Holland told Congress yesterday that America faces a growing affordability problem in housing because of stagnant wages, a supply-demand imbalance, and numerous hurdles and regulations in developing new apartments.

"Between 300,000 and 400,000 apartments must be constructed annually to simply keep pace with this demand," said Holland. "Yet, on average, just 208,000 apartments were delivered in the four-year period from 2011 to 2015."

He entreated policymakers to recognize that satisfying the housing needs of Americans will require a partnership between government and the private sector, and suggested fee and tax deferrals, and other ideas as potential solutions. He noted that Congress must enable new development at the federal level, preserve subsidy programs, and rehabilitate existing stock.

Mr. Holland testified before the House Committee on Financial Services Housing and Insurance Subcommittee on behalf of the National Multifamily Housing Council and the National Apartment Association. His full written testimony may be read here.

The same day Mr. Holland was testifying before Congress, New York City was enacting additional mandatory inclusionary housing standards in an effort to increase affordable housing in the city.

What does HUD Report for 2015 Year End Housing Data for the Northwest?

We've got your answers, courtesy of Mortgage Equities Northwest.

According to the latest HUD quarterly report for the Northwestern U.S., job growth continued to be strong during the fourth quarter of 2015.

Nonfarm payrolls increased 2.8 percent, or by 163,700 jobs, from a year earlier to 6.04 million jobs, the greatest fourth quarter gain since the labor market recovery began in 2010.

The fourth quarter unemployment rate dropped to 5.2 percent, marking the seventh consecutive quarter of jobless rate declines. The sales market was tight in major metropolitan areas during the fourth quarter. In response to strong job growth, the demand for sales housing led to a 13-percent increase in new and existing home sales and a 6-percent gain in the average price of new and existing homes sold.

Apartment market conditions are very tight to balanced, with vacancy rates ranging from 1.3 to 5.6 percent among the 15 metropolitan areas for which data are available.

Click here to read the full report.

HFO Brokers Sale of 283-Unit Gateway Apartment Community for $57.85M

San Diego, Calif. – MG Properties Group, a private San Diego-based real estate investor and operator, has announced the acquisition of the Russellville Commons Apartments in Portland, Oregon.

The 283-unit property was built as a luxury apartment community in 1999.  Units average 875 square feet and include a mix of floor plans in both townhome and flat configurations. Russellville Commons features remarkable common area amenities, including a resort-style pool and spa, modern fitness center with a yoga room, and a resident lounge and business center. The property is located in Portland’s Gateway District, an emerging transportation-oriented neighborhood providing convenient access by car and light rail to multiple job corridors throughout the Portland metropolitan area.

Russellville Commons was purchased for $57,850,000 from The Reliant Group, a San Francisco-based holding company. The seller was represented by Cody Hagerman and Tyler Johnson at HFO Investment Real Estate. The acquisition was financed with a 10-year fixed-rate mortgage provided by Joe Briganti at PNC Real Estate.

According to Mark Gleiberman, MG Properties Group Chief Executive Officer, “We are very pleased to expand our portfolio in the Pacific Northwest region with the acquisition of Russellville Commons. The property represents a continuation of our strategy to acquire high-quality assets with the potential for value-add improvements and strong current income generation.”

Russellville Commons marks MG Properties Group’s seventh acquisition in the past year.  The seven acquisitions totaled approximately 2,600 units and over $400,000,000 in combined purchase price. The company is targeting further acquisitions in Arizona, California, Colorado, Nevada, Oregon, and Washington.

MG Properties Group (www.mgproperties.com) is a privately owned West Coast real estate owner and operator specializing in multi-housing assets. Over the last 20 years MG Properties Group has acquired 90 communities with its private investors and institutional joint venture partners totaling nearly 18,000 units, representing more than $2 billion in total asset value, including 8,700 units at a value of $1.2 billion since 2010. The company’s current portfolio includes over 12,000 units in California, Washington, Arizona and Nevada. MG Properties Group employs 350 professionals with in-house expertise in acquisitions and underwriting as well as asset, property, construction and investment management.

HFO specializes in multi-family investment properties, and passionately pursues client success through strategic collaboration. The company is known for its ability to attract the largest possible pool of buyers. HFO offers substantial no-cost client services, including complimentary industry-specific events, market news, and original video programming via HFO-TV. From its inception, HFO has operated in sharp contrast to most of its industry competitors, using intra-office collaboration to provide service to a wider range of customers, through sales velocity and loyal client relationships. Portland-based HFO was founded in 1999 and to date in 2015 has been involved in the sale of thousands of apartment units. Learn more at www.hfore.com.

LEGISLATIVE ALERT: Legal Changes to Rent Increase Notices

Governor Brown signed HB 4143 into Law on March 14th with the effective date for changes to rent increase effective as of April 14th. 

Multifamily NW reported, "Our legal team has determined that the following language is effective for any increase in rent occurring on or after April 14, 2016. If a notice has been sent prior, but the actual increase occurs on or after this date, the new law applies."

• If the tenancy is a month-to-month ("MTM") tenancy, then no rent increases allowed during the first year after the MTM tenancy begins

• Should not affect any existing MTM tenancies that have been in existence for a year or more

• 90 Day Notice required for any rent increases in a MTM tenancy after the first year of the MTM tenancy

• Rent increase notice must include:

• The amount of the increase

• The amount of the new rent

• The date the increase becomes effective

• The State statute does not address rent increases at renewal of fixed terms tenancy.
  
• In the City of Portland, landlords are required to give 90 days' written notice to tenants when raising rents by 5 percent or more, or when evicting residents without cause. 
• If landlords don't follow the rules, tenants could be owed "an amount up to three months rent as well as actual damages, reasonable attorney fees and costs," according to city documents.

More information and Multifamily NW's positions on this new Law and other legislative topics addressed at 2016 Short Session Law Changes can be found at Multifamily NW.

Is the Seattle Apartment Market Going Bananas? Part 1 of 3: Development

Dupre & Scott, a Puget Sound apartment market and investment research company made a presentation to a Seattle City Council committee on Monday, giving them an overview of the apartment market in Seattle. Similar to Portland, Seattle and the city's surrounding markets are experiencing exponential economic growth and commercial development. In Part 1 of this three part series, Dupre & Scott cover development trends in Seattle. Part 2 will be a discussion on rents and vacancies concluding with affordability in Part 3.

Video - Is the Seattle Apartment Market Going Bananas? Part 1 of 3

Investors See Opportunity for Class-B Multifamily Assets - NREI

Apartment rents continue to rise across the country. National Real Estate Investor recently reported a significant trend with private capital investors chasing value-add projects in suburban markets. Investors are able to pay significantly less for class-B and class-C apartment properties relative to income compared to class-A property prices. The cap rates investors accept when they buy class- B and C properties are now about 220 basis points higher than cap rates they accept for class-A assets.

Read more.

Sold! 13-Units in Gresham, Oregon

HFO is pleased to announce the sale of the Courtyard at Park Place Apartments.This unique, well-located property in Gresham's exceptional multifamily market was built in 1974 and offered a mix of flats and townhomes. This 13-unit property sold for $1.3 million.

Build Your Legacy today with the help of HFO's team of brokers and unsurpassed professional staff focusing on assisting clients needs in the areas of research, underwriting, transaction management and marketing.

Learn more at www.hfore.com.

Sold! 36-Units in SW Portland

HFO is pleased to announce the sale of Redwood Court in SW Portland. This 36-unit asset sold for $5.9 million. Redwood Court offered a multifamily investor the rare opportunity to acquire an exceptionally well-maintained garden-court apartment in the John's Landing neighborhood of SW Portland.

The seller chose HFO to represent them in this transaction after several decades of building a relationship through providing relevant information and insight on the apartment market.

Build Your Legacy via multifamily investment properties with the advice and assistance of HFO's team of experts. Learn more at www.hfore.com.

Sold! 20-Units in SE Portland

HFO is pleased to announce the sale of the Ventura Park Apartments in SE Portland. This 20-unit apartment asset sold for $1.7 million. Ventura Park offered an investor the opportunity to acquire a turnkey asset in a premier location near Mall 205. When you're ready to Build Your Legacy with multifamily investment properties, be sure to contact the team at HFO.

Learn more at www.hfore.com.

Sold! 32-Units in Salem, Oregon

HFO is pleased to announce the sale of the Wayside Apartments in Salem. This 32-unit property, an exclusive HFO listing, is a well-maintained asset in a great Salem location. The listing sold for $1,750,000. Whether you're looking to invest, sell, or hold and improve operations with your multifamily asset, Build Your Legacy with the HFO team.

Learn more at www.hfore.com.

Are Today's Luxury Apartments Tomorrow's Affordable Housing?

The Seattle Times reports this week that what's important in creating affordable housing is to just keep building. One expert they interviewed said "There is a premium for a brand-new unit that has never been lived in and everything is perfect. There's less demand for a unit that is even 3 years old." Read more.