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If you think you can or you think you can’t, either way you are right.




Commercial Group has specialized in apartment brokerage in metro

Phoenix since 1998. Our agents have brokered more than 1,000

communities with gross sales in excess of 1 billion dollars. The

company also provides weekly updates (by e-mail) on apartment

sales and publishes an apartment market update on a quarterly basis

– past issues are available on the company’s web site

If you are interested in buying more apartments – we track both

advertised and off-market “pocket listings”. If you are seeking topdollar

for your assets or simply desire further insight on the

market affecting your property – don’t hesitate to ask.



Vacancy Rates Continue Decline

Vacancy rates for the 3rd quarter for stabilized 50+ multifamily

properties decreased from 6.8% to 6.5%. This is the 13th decrease in

the past 14 quarters. Vacancy rates for the 50-99 communities

decreased 0.14% – and the 100+ decreased by 0.39%. Of the 32

metro Phoenix sub-markets surveyed, 18 reported decreased

vacancy rates and only four reported vacancy rates above 8% (west

central and south Phoenix). Vacancy rates for each sub-market are

posted on our web site

New Construction Remains Very Strong

Seven projects were completed in Q3 totaling 1,869 units, one in

Chandler, two in Tempe, two in Gilbert, one in Scottsdale and two

in Phoenix. YTD there have been 3,821 units completed. There

were 12 new apartment projects started (2,777u) in Q3, mostly in

Phoenix, Scottsdale and Tempe. There are now a total of 33

currently under construction representing 9,089 units. This includes

Optima’s 781 units at Sonoran Village. Many of these projects have

commenced pre-leasing. There are also 61 additional projects in

various stages from initial rezoning to final permitting – representing

14,148 units. Details of each project and a map showing the location

of the current construction activity is posted on our web site under

“Apartments’ – “Market Data”.

Average Rental Rates (Individually Metered)

For 50 – 99 unit size apartment’s, the average rental rate was $700, a

2.8% over the Q3 2013. For the 100+ unit communities, the current

average rental rate is $807, a 2.9% increase of Q3 2013. We expect

the rates to continue to increase, but for the larger complexes, the

increase will likely be driven by the new construction with

significantly higher rents as opposed to an overall increase that

should be experienced by the smaller communities

The Metro Phoenix Apartment Market (Q3 2014)

2821 E Camelback Road, Ste. 600

Phoenix, Arizona 85016

Tel: 602 445 4141

Fax: 602 445 4188

In the 3rd quarter of 2014, there were a total of 55 regular apartment sales with 10 units or more, including only

one REO sale. 26 of these sales had 100 units or more. There was also one large portfolio sale that included 7

local properties for a price of $168,500,000. Eleven transactions included a 1031 exchange. We continue to see

an increase in 1031 transactions – a good sign. With the loan interest rates staying low, there were only 7

properties purchased “all cash”.

Vacancy and Rental Rates – Understanding the Numbers

Vacancy rates are the lowest since 2009, however, we expect the rate to increase as the recently completed

apartment projects start being classified as “stabilized”. Many projects are currently in lease-up and are not part

of the overall stabilized vacancy rate. We also expect average rental rates to increase – partly from the new

apartments with very high rents being added to the stabilized inventory. To fully understand the dynamics of any

particular sub market, having an in-depth understanding what the numbers mean will be critical.

Is it Time to Sell?

This is a question we are asked often, but it’s a difficult one to answer. Apartment values have not quite regained

the pre-2008 levels, but anyone that made a purchase after 2010 probably has significant equity. Since the fall of

2010, we have seen a steady drop in vacancy rates, and an increase in rental rates and overall property values.

Since we are inherently optimistic, we believe that the overall US economy will continue to improve, that

Arizona will have real job growth and a strong increase in population. Especially for the “B” and “C” properties,

we believe that apartment values will continue to increase in value. Due to the strong new apartment

construction, some of the class “A” and “B” properties may experience downward pressure on rental rates and

occupancy. If you believe in the continued up-side in apartment values, it might make sense to move up into a

larger property. Clearly this is how many investors made appreciable gains during the run-up from 2002 to 2007.

Possible Risks of Not Selling Now

Realize that not taking advantage of the current strong market is a calculated risk. What if values dropped next

year – and you really needed to sell soon and needed the money. This scenario might be appropriate for someone

that wants to retire or simply may no longer desire to be involved with apartment ownership. The concern is that

although there are many positive signs to support values increasing, there are negative concerns that might

significantly impact near-term future values. For example, at some point vacancy rates will start increasing, loan

interest rates will increase, the competition from all the new construction, there are geo-political risks from the

Middle East, the ebola virus, the US dollar being devalued and/or no longer being used as the international

trading currency, rising inflation, 47 million persons in the US on food stamps, etc. Real estate is cyclic and we

have had a run-up in values for the past four years.


KLCG has typically brokered “B” and “C” quality apartments with sizes from 20 to 100+. We’ve now added

several agents to provide the same level of expertise for owners of smaller apartment communities (4-20 units).

We can now assist investors as they acquire starter properties and also move up into larger communities.

Kasten Long Apartment Team: Scott Trevey, CCIM (480 205 0862), Linda Fritz-Salazar, Assoc. Broker (602 989 9487),

Jim Kasten, CCIM (602 677 0655), Jan Long, CCIM (602 434 9882), Arvle Knight, CCIM (602 885 8000), Jon Coffen (602

653 3600).

Small Apartment Division: John Locke (480 432 7179), Jerry and Marla Wicks (480 343 8537).


Kasten Long Commercial Group


Delivering THE New Standard of Commercial Brokerage Excellence




I am actively looking to build relationships with Real Estate Investors and Owner / Users for Phoenix  –  Scottsdale   –  Tucson   –  Maricopa County  – Pima County  –  Pinal County  –  Cochise County  –  Santa Cruz County   –Yavapai County  –  Gila County   –   Arizona ,  USA   

Walter Unger CCIM –   – 1-520-975-5207  –



Timeline of Phoenix, Arizona history,_Arizona_history



Phoenix, Arizona,_Arizona




Facts of Arizona – year 1848 to 2013

Feel free to contact Walter regarding any of these stories, the current market, distressed commercial real estate opportunities and needs, your property or your Investment Needs for Comercial Properties in Phoenix.




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Investors and owner/users need to really know the market before making a move in commercial investment properties as the market has a lot of moving parts today. What’s going on socio-economically, what’s going on demographically, what’s going on with location, with competing businesses, with public policy in general — all of these things affect the quality of your commercial properties/investment properties.  Therefore, you need a broker who understands commercial properties.  Please go to my web-site and get all the newsflashes and updates in Commercial Real Estate.



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Walter Unger CCIM, CCSS, CCLS

I am a successful Commercial / Investment Real Estate Broker in Arizona now for 20 years.  I am also a commercial land specialist in Phoenix and a Landspecialist in Arizona. If you have any questions about Commercial / Investment Properties in Phoenix or Commercial /  Investment Properties in Arizona,  I will gladly sit down with you and share my expertise and my professional opinion with you. I am also in this to make money therefore it will be a win-win situation for all of us. 

Please reply by e-mail or call me on my cell 520-975-5207 or Office:480-948-5554




Thank You


Walter Unger CCIM

Associate Broker,  West USA Commercial Real Estate Advisers

7077 E. Marilyn Road, Bldg 4, Suite 130

Scottsdale, AZ 85254

Cell:      520-975-5207   

Office :  480-948-5554

Fax: (480-658-1172


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What is a CCIM?


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