Home > multifamily, Uncategorized > Report says apartment market has plenty more growing to do

Report says apartment market has plenty more growing to do

Apartment builders are in development overdrive across the Houston area, fueling a construction boom with more than 12,000 units expected to be completed this year. That’s 40 percent more than 2013, a report shows.

But even as supply swells, it is only a small percentage of the local apartment stock and still well below the 2006 peak when 20,000 units opened, according to a second-quarter multi-family report from Marcus & Millichap, a commercial real estate firm. The Downtown/West Inner Loop area will account for the greatest share of this year’s new supply, as demand for inner-city living grows and housing prices continue to soar.

 

Architecture Demarest designed this 198-unit apartment building, Jefferson Heights, which is being built near downtown. Inner-city living is a big draw.

Courtesy Of JPI/TDI

Architecture Demarest designed this 198-unit apartment building, Jefferson Heights, which is being built near downtown. Inner-city living is a big draw.

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Last week, a Dallas-area apartment developer announced a project on the northwest fringe of downtown at 1520 N. Memorial Way near Houston Avenue. The 198-unit complex, Jefferson Heights, will have a pool deck overlooking downtown along with three courtyards, fire pits and an outdoor kitchen.

In the Heights, Greystar last week began demolishing an aging apartment complex just north of Interstate 10 across from White Oak Bayou for a luxury multifamily midrise called Elan Heights.

Both projects are expected to open in the second half of 2016.

As thousands of new units open this year, vacancy will fluctuate, but Marcus & Millichap predicts the year will end with a slight rise in vacancy at 6.3 percent. Despite the uptick, rents are projected to continue to go up, increasing 4.6 percent to an average of $950 per month across the area.

The Downtown/West Inner Loop submarket had the highest rents at the end of the second quarter at $1,650 per month. Apartments in the Memorial area saw the biggest increase in rents, rising 11.3 percent over a year ago to $1,461

Reprint from the Houston Chronicle   By Nancy Sarnoff

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Categories: multifamily, Uncategorized
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