WORLD PROPERTY JOURNAL
Commercial News » United States Edition | By Michael Gerrity | November 26, 2014 9:30 AM ET
According to the latest research from CBRE, multifamily investment in the U.S. is on pace for a record-breaking year, with total sales volume in 2014 on course to surpass the previous high of $105 billion set in 2007.
Multifamily sales volume totaled $27.5 billion in Q3 2014–an increase of 28% year-over-year. The total in the first nine months of the year reached $73.1 billion–3% higher than the same period in 2013. If the current pace of investment continues through the remainder of the year, annual investment could reach $105.2 billion in 2014, surpassing the prior peak of $105.1 billion set in 2007. Multifamily will be the first property sector to return to 2007 sales levels if it reaches this milestone.
Mid and high-rise property sales rose 75% year-over-year in Q3 2014. If this year’s pace of sales holds up in the final quarter, 2014 sales of mid/high rise properties will top the record level of $38.1 billion set in 2013. Garden apartment investment rose by 10% year-over-year in the quarter to $17.0 billion. Year-to-date sales of garden apartments reached $46.1 billion; 10% below the peak acquisition year in 2006.
CBRE Senior Managing Director of Capital Markets Brian McAuliffe commented, “Multifamily continues to lead commercial real estate through the recovery and into expansion. Three trends characterize recent investment activity by buyer category. First, private non-institutional buyers’ share of total activity has increased from 50% in 2013 to 59% so far in 2014. Second, foreign capital is playing a larger role, accounting for 6% of this year’s total apartment investment through Q3 2014–up from 5% in 2013–and 10% of all mid/high-rise investment–up from 3% in 2013. Third, REITs are playing a less active role in the investment arena, with market share of acquisitions falling from 20% last year to 9% this year.”
Downward pressure on cap rates and increasing sales price per unit reflect the large volume of capital committed to the sector, as multifamily investors continue to have a favorable view of this asset class. The average apartment sales price per unit was $128,000 in Q3 2014, representing an increase of 5.9% over the prior year.
U.S. multifamily expansion continued to pick up momentum in Q3 2014 as demand–measured by net absorption–grew at an annual rate of nearly 289,900 units. With rentable stock increasing only 256,700 units over the past four quarters, the average vacancy rate edged down year-over-year to 4.3%; 60 basis points (bps) below the historical average (1994-2013). Meanwhile, rent growth remained healthy at 3.0%, annualized.
The market that contributed the most to national demand growth over the past four quarters were Houston, New York, Los Angeles, Dallas, Austin, Washington, D.C., Atlanta, Seattle, Miami, Denver, Phoenix, Raleigh and Orange County–together accounting for more than half of the period’s total net absorption. Markets with the strongest growth in demand–over 3.5% from a year earlier–were all in the Southern or Western U.S. regions and included Austin, Raleigh, El Paso, Salt Lake City, Charlotte, San Jose, Richmond and Nashville.
Improving job growth and households’ rising propensity to rent were key factors driving demand. Household formation remains weak by historical standards, but as the improving economy and rising incomes continue to unleash pent-up housing demand, the multifamily sector could experience renewed momentum–maintaining and potentially exceeding its recent gains over the next 12-18 months.
CBRE Capital Markets Senior Managing Director Peter Donovan commented, “Consistent with the robust sales activity, we continue to see strong lender demand for multifamily loans. As a result, borrowers are seeing increasingly more attractive debt terms with respect to pricing and interest only. The lending market continues to show underwriting discipline with respect to proceeds and structure.” –
See more at: http://www.worldpropertyjournal.com/real-estate-news/united-states/multifamily-investment-in-2014-cbre-apartment-investment-report-multifamily-sales-volume-brian-mcauliffe-peter-donovan-8696.php#sthash.YYfdnSBp.dpuf
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
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 Investment Properties in Phoenix.
View my listings and my profile at:
Please go to my web-site and get all the newsflashes and updates in Commercial Investment Real Estate in Phoenix and Commercial Investment Properties in Phoenix daily
Check out my professional profile and connect with me on LinkedIn.
Follow me on Facebook:
Follow me on Twitter:
Follow Me on Google+
Walter Unger CCIM, CCSS, CCLS
I am a successful Commercial Investment Real Estate Broker in Arizona now for 20 years and I worked with banks and their commercial REO properties for 3 years. I am also a commercial landspecialist in Phoenix and a Landspecialist in Arizona.
WHETHER YOU LEASE OR OWN NOW IS THE TIME FOR YOU TO EXPAND, UPGRADE OR INVEST IN REAL ESTATE
we are at on the a rise of the cycle in Commercial Real Estate. so there is only one way and it’s called we are going up and now is the time for you to expand, upgrade or invest in Commercial Properties in Phoenix. The prices on deals I may get you will not be around forever.
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 in Commercial Properties in Phoenix or Commercial Properties in Arizona with you.Obviously I am also in this to make money, but it could be a win-win situation for all of us.
Please reply by e-mail email@example.com or call me on my cell 520-975-5207 or Office:480-948-5554
Walter Unger CCIM
Associate Broker, West USA Commercial Real Estate Advisers
7077 E. Marilyn Road, Bldg 4, Suite 130
Scottsdale, AZ 85254
Office : 480-948-5554
View my listings and my profile at:
a little about me and my expertise – video
Delivering the New Standard of Excellence in Commercial Real Estate
- Commercial Real Estate Scottsdale
- Commercial Real Estate Phoenix
- Commercial Real Estate Arizona
- Commercial Investment Properties Phoenix
- Commercial Investment Properties Scottsdale
- Commercial Investment Properties Arizona
- Land Specialist Arizona
- Arizona Land Specialist
- Land Specialist Phoenix
- Phoenix Land Specialist
- Land For Sale Phoenix
- Land for sale Arizona
- Commercial Properties For Sale Phoenix
- Commercial Real Estate Sales Phoenix
- Commercial Properties Phoenix
- Commercial Properties Arizona
- Commercial Land Specialist Phoenix
- Commercial Land Phoenix
- Multifamily land Phoenix
- Retail Land Phoenix
- Industrial Land Phoenix
- Land Commercial Phoenix
- Land Retail Phoenix
- Land Industrial Phoenix
- Land Multifamily Phoenix
- Industrial Land for sale Phoenix
- Land Industrial
- Investment Real Estate
Disclaimer of Liability
The information in this blog-newsletter is for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.