2A — September 13 - 26, 2019 — M id A tlantic
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Mid Atlantic Real Estate Journal
Mid Atlantic R eal E state J ournal Publisher, Conference Producer . .............Linda Christman AVP, Conference Producer ...........................Lea Christman Publisher ........................................................Joe Christman Section Publisher ............................................. Steve Kelley Section Publisher ............................................... Kim Brunet Editor/Graphic Artist ......................................Karen Vachon Office Manager ............................................... Kerrin Devine Contributing Columnist ............................Bendix Anderson Mid Atlantic R eal E state J ournal — Published Semi-Monthly Periodicals postage paid at Hingham, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal, 350 Lincoln St., Suite 1105 Hingham, MA 02043 USPS #22-358 | Vol. 31, Issue 16 Subscription rates: $99 - one year, $148 - two years, $4 - single copy REPORT AN ERROR IMMEDIATELY MARE Journal will not be responsible for more than one incorrect insertion 781-740-2900 | Fax: 781-740-2929 www.marej.com The views expressed by contributing columnists are not necessarily representative of the Mid Atlantic Real Estate Journal
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Apartment Occupancy Rate Hits a New High D Bendix Anderson espite more than a de- cade of strong growth under its belt, the apartment sector occupancy rate continues to hit new highs. "Terrific absorption has pushed occupancy upward to highs for this economic cycle," said Greg Willett, chief econo- mist for RealPage Inc., a pro- vider of property management software and services. That might seem strange. The occupancy rate in the U.S. has already been high for a very long time. Economists and apartment experts have been expecting more apart- ment units to become vacant for years, as more develop- ers open new buildings . But demand from renters remain strong, despite growing wor- ries that the U.S. economy may be weakening. “You would think that the market would be mature… We’ve had 10 years now of really strong multifamily de- mand,” said Jeanette Rice,
Americas head of multifam- ily research with real estate services firm CBRE. “It’s still positive as it has been for many years; in some ways, it is more positive.” Property managers fill apartments while they can The average apartment oc- cupancy rate in the U.S. rose to 96.2% in July, up 40 basis points from the year before, according to RealPage. That’s the highest the occupancy rate has been since 2000. Average rents are also grow- ing faster than inflation. “An- nual rent growth for new resident leases is solid at 3.1%,” said Willett. But the high demand could be push- ing rents higher more quickly,
he notes. “Price growth isn’t pushing upward the same way that occupancy is.” That’s because many prop- erty managers are worried that the good times in the U.S. economy can’t last forever. “Apartment owners and op- erators generally are pushing for high occupancy right now , even if that means leaving a few dollars on the table in rent growth results,” said Willett. “They are concerned about a possible slowdown in economic growth and housing demand that could come at the same time apartment deliveries remain sky high.” Demand grows despite economic worries continued on page 18A
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