WEEKLY
Mortgage Rate (30-Year Fixed): 6.60% (as of 3/16)
MONTHLY
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: 1.450 million (February 2023)
New Residential Housing Completion: 1.557 million (February 2023)
QUARTERLY
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. And the hottest multifamily rental market is…
Yardi RentCafe analysis reported that North Jersey has surpassed the Sunbelt as the most competitive rental market in the US, with eight of the top 20 hottest rental spots in the Northeast. Jersey City and Newark are relatively affordable with a desirable location for well-heeled renters. As a result, 72.2% of renters renewed their leases, making it harder for newcomers to find a place. Other metros that made the list include Miami-Dade County in FL; Harrisburg, PN; Grand Rapids, MI; Omaha, NB; Southwest, FL; Milwaukee, WI; Broward County, FL; Orlando,FL; and suburban Chicago, IL.
9. Marcus & Millichap arranges financing for North San Diego County multifamily complex
Marcus & Millichap Capital Corporation (MMCC) has secured a three-year loan at a 6.85% interest rate and 65% loan-to-value ratio for the acquisition of a 20-unit multifamily complex in Vista, CA. The complex is located at 991 Postal Way and offers easy access to the Ronald Packard Parkway and South Santa Fe Avenue’s commercial corridor. The low-rise apartment complex is highly desirable due to its proximity to retailers and eateries and the region’s rapid population growth. MMCC was able to secure favorable financing terms for its client, including a bridge loan with TI dollars.
8. JLL Capital Markets arranges $58M refinancing for a luxury apartment building in Jersey City.
JLL has secured a seven-year, fixed-rate loan through a life insurance company for 3 Journal Square, a 240-unit, mid-rise luxury apartment building located in the center of Jersey City’s Journal Square. The building was constructed in 2017 and is situated at 2955 John F. Kennedy Blvd., providing easy access to area amenities and the Journal Square PATH Station. JLL represented the borrower, 3 Journal Square Urban Renewal, LLC, in the transaction.
7. Marcus & Millichap brokers sale of Dallas multifamily
Marcus & Millichap has brokered the sale of Dallas portfolio consisting of three properties, Mercer Park, Timber Oaks, and Plum Meadow, with a total of 782 units in the Dallas area. Mercer Park is a 248-unit property in Arlington, while Timber Oaks in Grand Prairie offers 264 affordable housing units. Plum Meadow, located in the Redbird area of Dallas, consists of 270 market-rate units. The seller, NeuRock Capital, was represented by Wesley Racht, Nick Fluellen, and Bard Hoover of Marcus & Millichap. The terms of the sale were not disclosed.
6. Pearlstone Partners initiates construction of 182-unit South Austin multifamily project
The Montage, a new 182-unit multifamily project in South Austin, has broken ground through Pearlstone Partners. The development will consist of studio, one- and two-bedroom units ranging in size from 520 to 1,400 square feet and 12,872 sq ft of retail space. The development will also feature amenities such as a fitness center, coworking lounge, clubhouse, rooftop terrace, and a pool. Construction financing was provided by Knighthead Funding, with architecture services provided by STG Design. The project is expected to be completed in spring 2025.
5. Saxum Real Estate obtains $77.5M loan for Philadelphia multifamily development
Saxum Real Estate has secured a $77.5 million loan to finance the first phase of a two-building multifamily development in Philadelphia. The project, located in the Northern Liberties neighborhood, will consist of a seven-story building offering 279 units in studio, one-, two- and three-bedroom formats. The loan was arranged by JLL Capital Markets and will be provided by an undisclosed US-based life insurance company. Once both phases are complete, the development will feature 466 units and approximately 15,000 sq ft of retail space, including a fitness center, dog wash station, demonstration kitchen, cafés, co-working spaces, and resident clubrooms.
4. Multifamily permits surged in February
According to the HUD and the Census Bureau, housing starts in the US rose by 9.8% in February to a 1.450 million-unit annual pace, ending a five-month decline. The increase was mainly due to a surge in multifamily construction of 24%, while single-family starts rose by 1.1%. Permits also jumped 21.1% over the month. However, the rise in multifamily construction may spark concerns of an imbalance in the market. Most of the new construction is taking place in the South and West, where population growth has generally led to higher demand for housing.
3. Multifamily sales in Washington, DC remain strong
The metro D.C. multifamily market displayed a solid performance in 2022 despite the pandemic’s impact. The market recorded a 4.2% increase in YoY rents, with a relatively stable occupancy rate, and approximately 11,917 new units were delivered in the same period. Although transaction activity slowed toward the end of the year, the metro still closed the year with nearly $5.8 billion in multifamily sales. Additionally, the market is displaying a considerable pipeline, with 32,872 apartments currently under construction.
2. Health and wellness features to gain prominence in 2023
Multifamily development should focus on creating authentic apartment communities that encourage physical and mental wellness, according to design experts speaking on a panel at the International Builders’ Show 2023. The multifamily industry has responded to the post-pandemic increase in depression and anxiety screening by shifting some concentration to wellness, health, fitness, and overall well-being. Angela Harris, CEO and principal at design firm TRIO, said having interior architects and designers involved early in the process is key to integrating natural light, views, and natural finishes throughout the entire project.
1. CBRE: multifamily housing supply not enough after 2024
CBRE has predicted that 2.3 million new multifamily units will be needed across the US over the next decade. After the current delivery wave ends in 2024, the market will require approximately 200,000 additional units annually to maintain a balanced supply and demand. Although there are currently over 750,000 units under construction in markets such as Dallas, Austin and Atlanta, construction costs have increased rapidly due to inflation and supply chain issues, causing the rate of multifamily starts to slow.
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