Triad Rents and Vacancies Up

Real Data released the September update for their Piedmont Triad apartment market report. Here are the highlights:

  • Rents are up 3.9% since October 2018
  • Vacancies are up to 4.3% from 4.0% in October 2018 (and 3.7% in March 2019). This is due to new supply that is yet to be absorbed (units in lease up have a 31.2% vacancy rate).
  • Average rent for a 1BR is $813, for a 2BR is $914 and a 3BR is $1,156. These include A, B, and C-class properties.
  • 975 units were added in the last six months
  • 1,715 units are currently under construction – there were 2,941 units under construction in October 2018
  • 4,719 units are proposed, up from 2,141 in October 2018

You can order a full copy of the report, which includes sub-market breakdowns and details on all properties surveyed, at Real Data’s website – www.aptindex.com.

Piedmont Triad Apartment Market’s Rent Growth Continues to be Strong

According to Yardi-Matrix’s report on September rental trends, the apartment markets in the Triad, Charlotte, and Raleigh continue to be in the top tier of year-to-year rent growth in the country. The two tables below tell the story:

Piedmont Triad in Top 5 Rent Growth Markets

According to this piece on NAA’s website, the Piedmont Triad’s annual rent growth in July was in the top five in the country:

The leaderboard of rent growth leaders shuffled slightly, but the markets remained about the same. Las Vegas took the top spot for annual rent growth in July at 8.4%. Phoenix (8.3%), Sacramento (5.2%), Raleigh/Durham (5.1%) and Greensboro/Winston-Salem (5.0%) rounded out the top five. Austin, Nashville, Riverside, Charlotte, Atlanta, Milwaukee and Cincinnati all saw between 4.0% and 4.8% annual rent growth.

The article also points out that national occupancy rates hit 96.2% in July, the highest they’ve been in 20 years:

Strong leasing activity in this year’s peak season has continued to cause apartment vacancies to drop, with July’s occupancy rate reaching 96.2 percent. That rate, the highest rate since 2000, was up 0.4 points year-over-year.

As usual, occupancy was tightest in the Northeast region, at 97 percent. The West and Midwest were 96.5 percent and 96.4 percent occupied, respectively. Occupancy landed at 95.7 percent in the South. Those rates were up 0.2 points to 0.5 points from a year ago.

Of the nation’s 150 largest apartment markets, 91 meet or exceed the national norm for occupancy and 135 hit the effectively full mark of 95 percent. Only four markets register occupancy below 94 percent, including some supply challenged Texas markets like College Station and Lubbock.

Yardi Reports Triad’s Year-to-Year Rent Growth for June 2019

Yardi released its June Yardi Matrix Multifamily Report, its monthly summary of rental market conditions throughout the US, and found that the Triad’s rent growth is among the ten highest in smaller US metro markets. As you can see in the table below the Triad’s overall rent growth over the last year was 4.8%; “Lifestyle” rents increased by 6.2% and the “Renter-by-Necessity” sector of the market increased by 3.7%

You can download Yardi’s report by clicking here,

Rents Up, Vacancy Down in Piedmont Triad Apartment Market

Real Data just released their March, 2019 survey report for the Piedmont Triad and the results show that the apartment market continues to be very strong here in the Piedmont Triad. They report that the average vacancy rate is 3.7%, down from 5.5% in March of 2018, and average rent is $898 ($0.943/SF) versus $842 ($0.888) this time last year. From their market summary:

The Triad apartment market continues to tighten with an average vacancy rate at just 3.7%. Over the last year demand has been strong with 2,595 units absorbed, easily offsetting the 1,487 units added to the supply over the same time period.

The development pipeline included 2,081 units under construction and another 4,462 units proposed. Guilford County is the most active with 1,183 units under construction and an average vacancy rate at 3.3%.

The region has posted strong rent growth of 4.5% over the past twelve months…

With demand expected to remain strong, the average vacancy rate should hold close to 4.0% over the next year. Rents will continue to grow an an annual rate of 4% to 4.5%.

You can buy a copy of Real Data’s full report here.

RealPage Reports Rent Increases for Triad

RealPage released its rent report for the first quarter of 2019 which showed that the Triad had the fourth highest increase in the country. From an article in the Triad Business Journal:

Rent prices in the Greensboro/Winston-Salem metro area saw a 5.2 percent increase in the first quarter, with an average rent price of $830.

Greensboro/Winston-Salem ranked No. 4 in rent price increase among large metros, according to a first quarter apartment market report by RealPage Inc. (NASDAQ: RP). Phoenix, Arizona (up 8 percent), nabbed the top spot, followed by Las Vegas, Nevada (up 7.9 percent), and Atlanta, Georgia (up 5.3 percent). Charlotte ranked No. 11, with a 4 percent increase in rent prices.

Greensboro/Winston-Salem outpaced the national average, with U.S. apartment rents increasing by about 3.2 percent on an annual basis. 

Apartment Communities in Winston-Salem and Greensboro Sold

The Triad Business Journal recently published a story about the sales of two Triad apartment communities:

Six affiliates of the New Jersey-based WG Portfolio are the new owners of Twin City Townhomes in Winston-Salem. The companies paid $10.15 million for the apartment community, according to records on file with the Forsyth County Register of Deeds…

The companies owned the complex for less than a year, paying $7.8 million on Nov. 29, 2017, according to Forsyth County property records. The property occupies about 40 acres and has 27 buildings…

In Greensboro, Margate on Cone Apartments also has new owners.

According to the Guilford County Register of Deeds, Margate CGC LLC of New York and Beth Cone LLC of California paid about $10.6 million for the apartments at 900 E. Cone Blvd…

The complex last sold in 2005 for $6.9 million

Piedmont Triad Apartment Market Remains Hot – Where is it Hottest?

Real Data’s October survey results show that the apartment market remains very strong in the Piedmont Triad. Their market summary says it best:

The Triad apartment market is tightening with an average vacancy rate at just 4.0%. Over the last year demand has been strong with 2,348 units absorbed, easily offsetting the 1,595 units added to the supply over the same time period.

The development pipeline includes 2,814 units under construction and another 2,141 units proposed…

The region has posted strong rent growth of 3.8% over the past twelve months. The average rental rate is now $876 per month, as compared to $832 just twelve months ago. One bedroom units average $769, two bedrooms rent for an average of $869 and three bedrooms rent at $1,093 on average.

The report also indicates that the average vacancy rate should hold close to 4.0% for the next year and rents will continue to grow at a yearly rate of 3.5-4.5%.

Source: AptIndex.com

So which submarkets are the hottest in the Triad?

  • Occupancy – Guilford Northeast (97.5%)
  • Average Rent – Guilford Central ($1,091)
  • Average Rent per SF – Forsyth Central ($1.172)
  • Units Under Construction – Forsyth Central (573)

To get a full copy of the Real Data October, 2018 report go to aptindex.com.

One-Off or Early Signs of a Trend?

Those of us who were around pre-Great Recession can remember a time when it was relatively commonplace for apartment communities to be converted to condos. Then the mother of all recessions happened and rental housing became the most lucrative, and safest, real estate game in town and we stopped seeing those conversions – if anything we saw condos converting to rental units.

That’s what makes the news of this move in Winston-Salem pretty interesting. From a story in the Triad Business Journal:

Winston-Salem investors Ben Bloodworth and Taylor Williams purchased the 836 Oak Street Lofts apartments in downtown Winston-Salem for $2.75 million with plans to convert the 26 apartments in the former mill facility into condos.

The purchase included 1.22 undeveloped acres adjacent to the apartments.

Bloodworth told Triad Business Journal that all current leases would be honored, and the units would be upfitted and sold as the leases expire.

Downtown Winston-Salem is experiencing a boom of new housing, retail, restaurants and entertainment with the growth of the Wake Forest Innovation Quarter, including the Bailey Power Plant, and the office renovation projects at the GMAC tower.

Downtown Winston-Salem is a particularly hot market in the Triad right now, so this might portend a larger trend across the region, but it will be interesting to see if other investors follow suit, especially in the downtown markets of the Triad’s cities.

Colorado Company Purchases Triad Apartment Portfolio

From the Triad Business Journal:

Interurban Properties of Centennial, Colo., has purchased Loxley Place Apartments in Winston-Salem for $16.25 million from Graycliff Capital of Greenville. Loxley Place is at 3736 Kings Row in the Mt. Tabor neighborhood, just north of Robinhood Road.

In May, Interurban bought Springhouse Apartments, Ambercrest and The Fields Parkside in Winston-Salem for $26.3 million and rebranded the communities as the 433-unit View at 5010.

In August 2017, Interurban bought Southgate Gardens and Piedmont Trace, adjacent multi-family communities with 114 units on 12.32 acres at 209 Arthur Drive in Thomasville, for $5.1 million.

In January 2017, Interurban closed on a $9.5 million acquistion of Madison Hall Apartments in Clemmons, a 10.5-acre, 128-unit complex on Idols Road.

Interurban also owns Stadler Place in Greensboro and The Trails at Bethabara in Winston-Salem.