March 11, 2023 Weekly Investor Update

Life Bridge Capital Weekly Investor Update

March 11, 2023

The Latest in Commercial Real Estate (CRE), Economy & Markets


Market Indicators Snapshot



Mortgage Rate (30-Year Fixed): 6.73% (as of 3/9)


Existing Home Sales: -0.7% (January 2023)

New Residential Sales: +7.2% (January 2023)

Median Sales Price for New Houses Sold: $427,500 (January 2023)

Construction Spending: +5.7% YoY (January 2023)

New Residential Housing Starts: 1.339 million (January 2023)

New Residential Housing Completion: 1.406 million (January 2023)


Homeownership Rate: +65.9% (4Q22)

Rental Vacancy Rate: +5.8% (4Q22)


Sources: NAR, BLS, Federal Reserve Bank, MBA

Note: Rates listed are estimates and may not reflect actual rates depending on term, sponsor location, and other factors involved.



10. LA multifamily transactions set record high

The Los Angeles multifamily market set a record-high transaction volume with $5.8 billion, up by 6.7% YoY in 2022. According to Yardi Matrix, despite the year ending rent values plateauing at $2,594, which is still above the national average of $1,715, the market has added a total of 8,619 new units, representing 1.9% of the current inventory. It also benefited from the growth in the metro’s workforce, which has expanded by 4.5%.


9. Simon Property Group plans to convert parking lot into multifamily 

Simon Property Group, the largest mall REIT, has announced plans to convert a 700-vehicle parking facility at the Stoneridge Shopping Center in Pleasanton into a 360-unit, five-and-a-half-story residential campus. The 618,000 sq ft apartment building will include a new 383,000 sq ft parking garage that can hold 473 cars inside the building. The apartment units will be wrapped around an internal, five-level parking structure, and residents will have access to outdoor courtyard spaces and a common rooftop deck area. The project will be built on six acres of land between the mall and a new 10X Genomics campus, and was one of nine sites zoned for high-density multifamily development in 2012 to meet the state’s target in a previous planning cycle.


8. Orange County’s multifamily market remains highly desirable

With a continued expectation of future job growth, Orange County’s rental units remain in high demand, leading to rent growth and high occupancy. According to Shane Shafer, managing director of Northmarq, multifamily values remain high with a median sales price of $366,400 per unit, and Class A properties are trading for over $500,000 per unit. Central Orange County has experienced a surge in demand due to limited new construction, affordable rental levels, and good-paying jobs. Despite slowing down, rent growth in Orange County remains strong.


7. San Antonio apartment high-rise sold to mystery buyer

A nine-story apartment high-rise in San Antonio, called the VUE, has been sold to an undisclosed buyer. Built in 2004, the complex has 91 apartments and was last purchased by Mission DG development firm for $9 million in 2018. The property was completely revamped by Mission DG, which purchased it as a vacant senior living facility that had been unoccupied for about 17 years. While the price of this newer sale was not disclosed, the Bexar County Appraisal District valued the property at almost $12 million in 2022.


6. Greenville Design Review Board approves multifamily development

The 75-foot tall Prospect Hill Residences by Red Fox Development Co. has been approved for construction at 375 W. Broad St. in Greenville by the Greenville Design Review Board. The development will include 153 units with indoor parking, a ground floor outdoor terrace, lobby and lounge area, fitness center, outdoor pool and cooking area, rooftop parlor, and observation deck. The building will have studios, one- and two-bedroom units, and penthouses with higher ceilings and elevated finishes. It is located within walking distance to downtown and Unity Park.


5. CBRE brokers sale of multifamily development

CBRE brokered the $7.8 million sale of a 10-acre development site in Farmington, a Hartford suburb, to Connecticut-based Skala Partners. The site is approved for constructing 204 multifamily units with amenities including a pool, fitness center, dog park, clubhouse, business center, and a package locker system. Jeff Dunne, Simon Butler, Biria St. John, Eric Apfel, Stuart MacKenzie, John McLaughlin, and Brian Bowler of CBRE represented the seller, Sovereign Partners, in the transaction. Details on construction timelines and floor plans have not been disclosed.


4. Brooklyn’s multifamily market outperformed most US markets

Brooklyn’s multifamily market registered a 0.3% increase in average rent on a trailing three-month basis as of November, compared to a 0.1% contraction nationally. Occupancy rates were also high, with the average rate in stabilized assets at sitting 98.6%. While sales prices have oscillated, investment volume has remained consistent over the past 24 months, with 2022 keeping pace with the prior year. Development in the borough has slowed, with only 1.4% of existing rental inventory accounted for by the 2,067 units delivered in the first 11 months of 2022.


3. CBRE brokers sale of 1.7-acre site in Chicago’s Fulton Market 

CBRE has arranged the sale of a 1.7-acre site in Chicago’s Fulton Market neighborhood for $34.5 million. The site, located at 420 N. May St., was sold by 420 May Acquisitions LLC to Miami-based developer Crescent Heights. The buyer has proposed a large multifamily project for the site. Crescent Heights has been active in the Chicago market with multiple projects, including the tallest apartment building in the city, Nema Chicago, completed in 2019.


2. Multifamily market to benefit from housing market gap

The 2022 US Housing Report by the National Association of Realtors (NAR) reveals that the multifamily market delivered an approximate 340,000 units annually over the last decade. The group also announced that the large gap between single-family home constructions and household formations, which expanded to 6.5 million homes in the same period, proves to be a huge opportunity for multifamily to fill in the demand. In the past year, NAR noted that multifamily unit construction grew by 35.1%, indicating its best performance since 2015.


1. CBRE forecasts more than 700K multifamily housing units for delivery until 2025

CBRE released a research brief that forecasts the country will deliver approximately 716,000 multifamily housing units in the next 24 months. That represents almost 358,000 deliveries per year, or an increase of 5.2% over the baseline. As of its writing, the group approximates that there are 750,000 units in the pipeline, the most since the 1980s. 



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