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www.CharlestonCommercialMarketForecast.com
MULTI-FAMILY REPORTRobert Morgan
A Fully Integrated Multifamily Service Provider
www.CharlestonCommercialMarketForecast.com
Multifamily Report
1 U.S. FUNDAMENTALS
2 CHARLESTON MARKET
3 OPPORTUNITIES
4 TRENDS
Daniel Island Village, 2008
www.CharlestonCommercialMarketForecast.com
Drivers of Multifamily Housing:
• Job growth / employment rate• Wage growth• Residential still undersupplied by historical
standards• Renters by choice
U.S. FUNDAMENTALS
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• Job growth approximately 2% annually since the Global Financial Crisis• Wage growth decelerating, but with full employment creates potential to rise
U.S. FUNDAMENTALS
Source: Bureau of Labor Statistics, Moody's Analytics
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• Demand-fueled recovery continues
U.S. FUNDAMENTALS
Permits in these calculations refer to LTM permits offset 4 quarters prior to the current quarter. This offset accounts for time of construction and is most historically reliable in predicting rent growth. Source: Bureau of Labor Statistics, US Census Bureau, Moody’s Analytics, Greystar
www.CharlestonCommercialMarketForecast.com
• Total residential supply is benign • If current MF building remains constant, 4.5 years to backfill debt of supply
U.S. FUNDAMENTALS
Source: US Census Bureau
www.CharlestonCommercialMarketForecast.com
• Rent growth continues but decelerates, still solid by historical standards
U.S. FUNDAMENTALS
Source: Axiometrics
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U.S. FUNDAMENTALS
34.1%
62.9%
69.1%
74.7%
77.9%
58.3%
HO Rate change since 4Q15
1.4%
0.5%
1.0%
1.0%
0.9%
Source: Moody’s Analytics, US Census Bureau
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CHARLESTON MARKET
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CHARLESTON MARKETSummerville: $1,230 $1.30 psf
• Top of Submarket Asking Rents: price per month & per square foot
N Charleston: $1,256 $1.21 psf
Daniel Island: $1,704 $1.90 psf
Downtown: $1,874 $2.15 psf
Mt Pleasant: $1,645 $2.17 psf
W Ash/James I: $1,738 $2.09 psf
W Ash (out): $1,557 $1.49 psf
www.CharlestonCommercialMarketForecast.com
• Peak conditions have already been achieved• Solid, but more normalized growth
CHARLESTON MARKET
Source: CoStar Market Analytics
www.CharlestonCommercialMarketForecast.com
• Peak conditions have already been achieved• Solid, but more normalized growth
CHARLESTON MARKET
Source: CoStar Market Analytics
www.CharlestonCommercialMarketForecast.com
• Peak conditions have already been achieved• Solid, but more normalized growth
CHARLESTON MARKET
Source: CoStar Market Analytics
www.CharlestonCommercialMarketForecast.com
OPPORTUNITIES
www.CharlestonCommercialMarketForecast.com
OPPORTUNITIES
Charleston Neck 2016 (image courtesy of JLL)
Atlanta West Midtown 2003
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OPPORTUNITIES
Charleston Neck 2013
Atlanta West Midtown 2016
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TRENDSLast Cycle:• Charleston: greenfield and suburban • Atlanta & Charlotte: urban infill mid-rise product, some mixed-use
Current Cycle:• Charleston: several class-A projects are now urban/suburban infill, assemblage
sites, high-density, and some mixed-use• Atlanta, Charlotte, Nashville, and Raleigh: extremely dense complex mixed-used
projects, as well as towers
Next Cycle:• The evolution to provide urban housing in desirable areas will continue• Dense multifamily housing will improve the viability of our cities and suburbs• Niche projects catering to evolving renter demands
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TRENDS
Elan Midtown – Charleston, SC
Courier Square – Charleston, SC
Elan Westside – Atlanta, GA
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TRENDS
Overture Crabtree – Raleigh, NC
Overture Lindbergh – Atlanta, GA
