- A combination of sluggish job growth and abundant supply has made Washington, D.C. one of the worst U.S. markets for landlords, but rebounding employment is leading to renewed development.
- Toll Brothers (NYSE:TOL) plans to more than double its stock of apartments over the new three years, Camden Property Trust (NYSE:CPT) has 862 units under construction, and AvalonBay (NYSE:AVB) is boosting its investment in what may be a coming hot neighborhood. The nation's largest apartment REIT, Equity Residential (NYSE:EQR) is set to start work on a 174-unit building in Georgetown stalled since 2012. Still a bit wary, UDR is buying rather than building - last month it agreed to acquire six suburban communities from Home Properties.
- Effective rents fell 1.4% in 2013, and rose just 0.4% last year - enough to scare off smaller players. REITs however, have access to relatively cheap capital, giving them the opportunity to step in while the market is soft to hopefully take advantage of the next upturn.
- According to Axiometrics, effective rents will climb 3.4% in 2016 versus 2.9% for the entire country. 2107 should see a 4.5% increase, with 3.6% estimated for 2018.
- Source: Bloomberg
- Previously: Multi-family action leads gain in housing starts (July 17)