A Little Bit More Supply Than Demand
A report from the Denver Post in Colorado. “The Denver area’s apartment building frenzy will slow next year as demand for new high-end developments wanes and financing for new projects gets tighter, say economists and industry leaders. Those in the industry agree that Denver’s high-end apartment market is oversaturated. ‘The reality is that (the industry is) building high-end apartments, and that is not where the majority of people moving to Denver can afford to move,’ said Tim Walsh, CEO and founder of Confluence Companies, a real estate development company.”
The Dallas Morning News in Texas. “Seems like every year someone predicts a slowdown in North Texas apartment building. And every year, the number of rental units on the way in the Dallas-Fort Worth area grows. But when one of the country’s biggest apartment builders says he thinks the construction cycle in D-FW has topped out, it pays to listen.”
“At midyear, more than 50,000 apartments were being built in the area — one of the largest numbers of new units on the way in any market in the country. ‘Supply has peaked,’ says Steve Bancroft, senior managing director of Dallas-based Trammell Crow Residential. ‘There is a little bit more supply than demand today.’”
The Real Deal on New York. “According to this week’s market reports, Manhattan had the nation’s biggest residential rent decrease. Manhattan tied with the city of Lubbock, Texas, for the biggest rent decrease in the nation in July, registering a 3.1 percent year-over-year slide to $4,054 per month. Brooklyn came in at No. 7, with a 1.6 percent decrease to $2,712.”
The Press and Sun Bulletin in New York. “A former cigar factory in Binghamton’s First Ward will soon be home to 97 market-rate housing units and business space, turning the now vacant building into an industrial loft apartment complex, Broome County Executive Jason Garnar and Binghamton Mayor Richard David announced Monday. In 2016, Paulus Development began turning the former factory in Syracuse into an 89-unit apartment complex with commercial space on the first floor. That project, which received $900,000 in state funding through the REDC, is expected to open in August of this year.”
“Faced with a student housing glut, the city will no longer offer payment-in-lieu-of-taxes (PILOT) agreements to future student housing complexes, David has said in the past. ‘In the city, we have made a commitment to move away from big-box student housing projects,’ and toward market-rate buildings, David said.”
From Curbed Miami on Florida. “The gorgeous 321 Ocean penthouse in Miami Beach has returned to the market with a new price tag of one dollar under $35 million. It initially listed for $53 million in December 2015, six months after its owners purchased the five-bedroom unit for $20 million. In January, it received an extensive chop, getting reduced to $39.5 million.”
The Milwaukee Biz in Wisconsin. “In June, Capri Communities LLC filed plans with the Village of Menomonee Falls to build a 226-unit senior living facility. The development is in addition to the 321 units Brookfield-based Capri announced it would be adding in Germantown, Port Washington and the East Side of Milwaukee since January. But the company is not alone. Senior living operators across southeastern Wisconsin and the country are ramping up their expansion efforts as the oldest baby boomers are just beginning to need the services their companies can provide.”
“And many of the facilities elderly people are moving into today have far more amenities than the nursing home your grandparents lived in. The idea of giving seniors more than a bed and three square meals a day has resonated with Capri Communities founder James Tarantino and other operators. Today’s senior living complexes are a hybrid of luxury apartment, four-star hotel and health care facility. Amenities offered in new developments include wine rooms, heated therapy pools, salons and spas, bocce ball courts, putting greens and common areas where residents can host holiday parties and book clubs.”
“‘That will be a 20-year run of higher demand that has not even taken off yet,’ said Milo Pinkerton, founder of the largest senior living provider in the state. ‘I don’t think we’ve overbuilt the market. Twenty years from now, maybe we’ll be overbuilt like the apartment market is today.’”
