Advertisement

April 18, 2014

Apartments Are Hottest Development In the Triangle. Get It? - Apartment Transactions Are on Way Up

As we previously blogged about here, in our post entitled "Realtors Calling 'The Age of Multifamily' Residential Development as North Carolina Sees the Impact", apartment building and apartment transactions (sale and purchase of already-constructed complexes) is on the way up.  Way up.  I can see the construction aspect clearly, right here in Raleigh, as I drive to and from our offices in downtown Raleigh.  As we said then, in October, "Multifamily residential is hot.  Real hot."

But what about rental rates and occupancy rates?  These are, after all, the fundamentals driving the sales, purchases, construction and entitlements referenced in our prior post. 

Well, the Triangle Business Journal published today an interesting blurb on this very topic, entitled "Apartments Springing Up Across Triangle".  The title evokes a story of construction-mania.  But the subject goes deeper, into the kind of information driving the business decisions of developers and private equity funds.  Check it out:

"More than 9,200 apartment units are currently under construction in the Triangle, and another 6,300 units are proposed to be built, according to the most recent semiannual apartment market report from Real Data, a market research firm based in Charlotte.  Real Data’s report for January shows that the vacancy rate for apartment communities in the Triangle dropped to 5.5 percent. The rate is down from a 6.6 percent vacancy rate the year prior, which was already the lowest rate reported since 1998.  The average rental rate for an apartment in the Triangle increased to $868 per month, up from $834 a month the year prior.  But the average rental rate for a new apartment built in the last 12 months is around $1,400 per month."

Yep, the average--average--rental rate for a new apartment in the Triangle, built in the last 12 months, "is around $1,400 per month." 

So, let me get this straight: interest rates are so, so low in the "wake" (or the end, or the close to the end or the almost to the close to the end, or whatever) of the Great Recession, construction prices are competitive, and land is still relatively cheap, yet monthly rental prices for new apartment units are at or higher than they were before the Great Recession?  As an aside and a point of comparison, I paid $1,400/month for my first apartment in Manhattan, on 49th Street and 9th Avenue in Hell's Kitchen.  Granted, that apartment was old.  And small.  But I was some 2 avenue blocks from Times Square.

Anyway, while this isn't a true legal post, I think our readers and clients will find great interest in this latest real estate frenzy--apartments.

Copyright © 2014 Womble Carlyle Sandridge & Rice, PLLC. All Rights Reserved.

About the Author

Michael C Thelen, Womble Carlyle Firm, Litigation Attorney
Attorney

Mike represents myriad clients – from Fortune 500® companies to smaller, privately-owned organizations – in cross sections of business throughout the many stages of federal and state litigation.  From his years of practice in New York and North Carolina, Mike primarily has experience in the areas of land use, local/municipal government law and real estate litigation, having handled zoning, development agreement, land use planning, eminent domain and condemnation, construction, retail and commercial landlord-tenant, partnership dissolution, state law torts, and civil...

919-755-2154

Boost: AJAX core statistics

Legal Disclaimer

You are responsible for reading, understanding and agreeing to the National Law Review's (NLR’s) and the National Law Forum LLC's  Terms of Use and Privacy Policy before using the National Law Review website. The National Law Review is a free to use, no-log in database of legal and business articles. The content and links on www.NatLawReview.com are intended for general information purposes only. Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. No attorney-client or confidential relationship is formed by the transmission of information between you and the National Law Review website or any of the law firms, attorneys or other professionals or organizations who include content on the National Law Review website. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor.  

Some states have laws and ethical rules regarding solicitation and advertisement practices by attorneys and/or other professionals. The National Law Review is not a law firm nor is www.NatLawReview.com  intended to be  a referral service for attorneys and/or other professionals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional.  NLR does not answer legal questions nor will we refer you to an attorney or other professional if you request such information from us. 

Under certain state laws the following statements may be required on this website and we have included them in order to be in full compliance with these rules. The choice of a lawyer or other professional is an important decision and should not be based solely upon advertisements. Attorney Advertising Notice: Prior results do not guarantee a similar outcome. Statement in compliance with Texas Rules of Professional Conduct. Unless otherwise noted, attorneys are not certified by the Texas Board of Legal Specialization, nor can NLR attest to the accuracy of any notation of Legal Specialization or other Professional Credentials.

The National Law Review - National Law Forum LLC 4700 Gilbert Ave. Suite 47 #230 Western Springs, IL 60558  Telephone  (708) 357-3317 If you would ike to contact us via email please click here.