Is Now the Time for Multifamily Owners to Sell?

 

 

 

You miss 100 percent of the shots you never take, and if you think it’s expensive to hire a professional to do the job, wait until you hire an amateur “    ARE YOU READY TO SELL OR PURCHASE YOUR LAND OR COMMERCIAL BUILDING IN PHOENIX, SCOTTSDALE, MARICOPA COUNTY AND PINAL COUNTY, ARIZONA,  CLICK HERE  AND PLEASE CALL ME.     520-975-5207 or email me walterunger@ccim.net.  ….  VIEW ALL OF WALTERS LISTINGSLet me know if you are interested in Apartments: CLICK HERE FOR APARTMENTS FOR SALE

 

March 22, 2018 | By Brian J. Rogal

Potential sellers in the Midwest have taken a step back and hesitated to put their properties on the market.

CHICAGO—The US multifamily market has been in the midst of a years-long boom, and demand is still robust. But in a year that could bring changes, especially when it comes to interest rates, potential sellers in the Midwest have taken a step back and hesitated to put their properties on the market.

“In the past six months, we noticed a bit of a slowdown,” Todd Stofflet, managing partner at Chicago-based KIG CRE, tells GlobeSt.com. He believes many owners may have instead decided to refinance their properties.

In many ways, that would not be an unreasonable strategy. Interest rates are quite low, and in the past few years lenders have looked very favorably on multifamily properties. But Stofflet also feels these owners might want to still consider potential sales.

For one thing, he says, after a period when it was sometimes difficult to guess what the Federal Reserve would do about interest rates, today “the crystal ball is clear.” To dispel uncertainty, Fed officials have carefully telegraphed their upcoming moves, and along with yesterday’s hike in its key interest rate, experts believe another three hikes will come over the course of 2018. And to Stofflet, that means the optimal point to refinance may be past. But when it comes to selling, it’s a different story.

“The environment is perfect right now,” he says, largely because investors are obviously eager to put more money into commercial real estate, and multifamily is at the top of many wish lists. “That creates a nice environment for executing dispositions.”

That was definitely the experience of Castle Lanterra Properties. As reported in GlobeSt.com, the Suffern, NY-based investor bought Midpointe Apartments, a multifamily property on the far southwestern edge of Chicago in 2014 for $28.5 million, and had been prepared to hold onto it for an extended period. But those plans changed last year when a number of institutional investors and family offices made inquiries about the 424-unit complex, a slightly surprising amount of attention for any property in the quiet Mt. Greenwood neighborhood. CLP sold it for $49.5 million.

2018 marked the first year that the average target allocation for real estate investments surpassed 10%, Stofflet says. And investors have shown interest in properties outside the top submarkets of core cities like Chicago. Cap rates in secondary markets, Stofflet points out, can run 50 to 75 bps higher than ones for similar properties in core cities. “That creates a nice opportunity for groups that may have not historically looked at Indianapolis or Louisville.”

In the Midwestern states where KIG CRE operates (IL, OH, MI, WI, IN, KY and IA), “we saw 144 institutional transactions in 2017, up from 31% from 110 in 2016. Sales volume in these states increased by 25%, from $5.65 billion in 2016 to $7.05 billion in 2017.”

And other factors may make refinancing less favorable than one year ago. For example, even though cap rates have so far remained at a steady 5.7% nationally from 2016 to 2017, the upward creep of interest rates means that will not last forever. Furthermore, Stofflet believes “cap rates are artificially low because of the amount of capital chasing deals,” and smart owners should foresee an environment that will only grow less favorable to selling.

Fannie Mae’s chief economist noted that easing credit standards declined for the first time in five quarters — to the lowest level in a year, he adds. “We’re also going to see a more conservative lending environment in 2018 than we did last year.”

As a result, many discussions are going on about whether to sell or lock in long-term financing on favorable terms. “There are a lot of owners sitting on the fence.”

 

Brian J. Rogal › Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.

More articles by this author ›

ARE YOU READY TO SELL OR PURCHASE YOUR LAND OR COMMERCIAL BUILDING IN PHOENIX, SCOTTSDALE, MARICOPA COUNTY AND PINAL COUNTY, ARIZONA,  CLICK HERE  AND PLEASE CALL ME.     520-975-5207 or email me walterunger@ccim.net   

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KASTEN LONG Commercial Group and AMA Events, Resources & Education For Apartment Owners

Timeline of Arizona from  900 BC – 2017     

WHY PHOENIX? AMAZING!!!  POPULATION IN 1950 – 350 K PEOPLE; “NOW 5 MIL”. – “5TH. BIGGEST CITY IN USA”

PHOENIX TOPS US IN POPULATION GROWTH (MORE THAN LA, NYC) AND WHY THAT’S GOOD FOR THE ECONOMY, BUSINESS

FROM ME:                                                                      

Phoenix Commercial Real Estate and Investment Real Estate: Investors and Owner / Users need to really know the market today before making a move in owner user Commercial Properties, Investment Properties and land in Phoenix / Maricopa County, Pinal County / Arizona, as the market has a lot of moving parts today. What is going on socio-economically, what is going on demographically, what is going on with location, with competing businesses, with public policy in general — all of these things affect the quality of selling or purchasing your Commercial Properties, Commercial Investment Properties and Commercial and large tracts of Residential Land  Therefore, you need a broker, a CCIM (Certified Commercial Investment Member) who is a recognized expert in the commercial and investment real estate industry and who understands Commercial Properties and Investment Properties. I am marketing my listings on Costar, Loop-net CCIM, Kasten Long Commercial Group.  I also sold  hundreds millions of dollars’ worth of  Investment Properties / Owner User Properties in Retail, Office Industrial, Multi-family and Land in Arizona and therefore I am working with  brokers, Investors and Developers. I am also a CCIM and through this origination ( www.ccim.com ) I have access to marketing not only in the United States, but also internationalClick here to find out what is a   CCIM:   https://en.wikipedia.org/wiki/CCIM 

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ARE YOU READY TO SELL OR PURCHASE YOUR LAND OR COMMERCIAL BUILDING IN PHOENIX, SCOTTSDALE, MARICOPA COUNTY AND PINAL COUNTY, ARIZONA,  CLICK HERE  AND PLEASE CALL ME.     520-975-5207 or email me walterunger@ccim.net

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WEEKLY LAND CLOSING UPDATE / THROUGH March 16, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY LAND CLOSING UPDATE / THROUGH March 9, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY LAND CLOSING UPDATE / THROUGH March 2, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY LAND CLOSING UPDATE / THROUGH February 23, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY LAND CLOSING UPDATE / THROUGH February 16, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY LAND CLOSING UPDATE / THROUGH February 9, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY LAND CLOSING UPDATE / THROUGH February 2, 2018 / Phoenix Arizona Metro, Maricopa County, Pinal County.

WEEKLY APARTMENT CLOSING UPDATE THROUGH March 16, 2018,  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH March 9, 2018,  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH March 2, 2018,  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH February 23, 2018,  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH February 16, 2018,  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH February 9, 2018/  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH February 2, 2018/  Phoenix Arizona Metro.

WEEKLY APARTMENT CLOSING UPDATE THROUGH January 25, 2018/  Phoenix Arizona Metro.

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8 Reasons You Should Invest in Land

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Timeline of Arizona from  900 BC – 2017                                                

WHY PHOENIX? AMAZING!!!  POPULATION IN 1950 – 350 K PEOPLE; “NOW 5 MIL”. – “5TH. BIGGEST CITY IN USA”

PHOENIX TOPS US IN POPULATION GROWTH (MORE THAN LA, NYC) AND WHY THAT’S GOOD FOR THE ECONOMY, BUSINESS

DOT – LOOP 202 / SOUTH MOUNTAIN FREEWAY / PHOENIX AZ – UNDER CONSTRUCTION

ARIZONA FACTS – YEAR 1848 TO 2013

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What is a CCIM.

CLICK HERE TO VIEW MY WEBSITE

  • DEMOGRAPHIC FACTS ABOUT MARICOPA COUNTY:
  • The average age of the population is 34 years old.
  • The health cost index score in this area is 102.1. (100 = national average)
  • Here are some of the distributions of commute times for the area: <15 min (22.7%), 15-29 min (36.8%), 30-44 min (25.1%), 45-59 min (8.6%), >60 min (6.8%).

PHOENIX PROJECTED AS NUMBER ONE US HOUSING MARKET FOR 2017

LIST OF ECONOMIC DEVELOPMENT PROJECTS IN PINAL COUNTY, REVISED 2-14-17

Reasons to Consider me for Commercial Referrals – I have the Knowledge and Experience                                                                                                                         

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Click here to find out what is a CCIM:

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Walter Unger CCIM –  walterunger@ccim.net   – 1-520-975-5207  –  http://walter-unger.com

2016 Official Arizona Visitors Guide

Visit Arizona

Why Phoenix?  This is a very interesting article, you should read it, amazing, there were only 350 K people living in Phoenix in 1950

Timeline of Phoenix, Arizona history

Phoenix, Arizona

Facts of Arizona – year 1848 to 2013

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 Kasten Long Commercial Group tracks all advertised apartment communities, including those advertised by other brokerages.  The interactive map  shows the location of each community (10+ units) and each location is color coded by the size (number of total units). 

 Walter Unger CCIM, CCSS, CCLS

I am a successful Commercial / Investment Real Estate Broker in Arizona now for 20 years.  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. 

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Walter Unger CCIM

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Kasten Long Commercial Group

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Phoenix , AZ 85018

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