Low supply and high demand continue to define Boston’s multifamily housing market. With a finite amount of available land, adaptive reuse is becoming an increasingly popular way to bring new multifamily inventory to market at a time where the appetite for apartment housing – be it workforce level or luxury – seems nearly insatiable.
Multifamily units in close proximity to mass transit, jobs and lifestyle amenities remain at peak demand. Data shows that these walkable communities are attracting not just young professionals and the millennial generation, but also empty nesters who are selling their large suburban homes and migrating to cities. RENTCafe’s analysis of Census Data found that senior renters are actually the fastest growing renter segment in the U.S. and that the number of renters over age 55 has increased by 28 percent. Meanwhile, the National Association of Realtors found that 62 percent of millennials prefer living in walkable communities.
Gentrification is breathing new life into neighborhoods across Greater Boston. A recent report by Governing Magazine shows that since 2000, more than 20 percent of the Census tracts in Boston that were eligible for gentrification have done so, resulting in a 50 percent increase in home prices in some neighborhoods. Most recently, East Boston, South Boston and Dorchester have begun to reap the benefits of gentrification, spawning new development which is, in turn, driving up asking rents. As these neighborhoods come into their own, offering improved access to transportation and jobs, investors can benefit from buying undervalued Class-B and Class-C assets and making capital improvements that will lay the foundation for increased occupancy, sustained rent growth and higher returns.
Bad news for prospective homeowners is good news for multifamily investors in the Rhode Island submarkets.
The recently passed tax reform package represents the most sweeping tax reform the country has seen since the Tax Reform Act of 1986 and will shift the dynamics of the real estate market in 2018 and beyond. While changes to mortgage interest and local and state deductions may adversely impact many homeowners, the new provisions are generally seen as positives for real estate investors and developers. In fact, many of the provisions passed will help investors by putting more money back into their pockets
Hartford, Conn. and Springfield, Mass. are both markets offering upside for value-added investors. With the expansion of transportation along the Hartford-Springfield corridor and job creation from the new MGM Springfield, this is an opportune time to consider acquiring a Class-B or Class-C property to reposition as part of your investment real estate portfolio. Here are some of the trends currently shaping the Hartford-Springfield market.
Record-high asking rents and selling prices for commercial real estate in the five boroughs pose an ongoing challenge for investors seeking to maximize returns. A recent article in The Journal News notes high asking rents and the conversion of commercial space into residential in Manhattan is now driving companies to explore options in Westchester County. Among the Westchester communities where these businesses have found new commercial space are Elmsford, Mount Vernon and Yonkers.
Values, rents and occupancy rates are rising in the Class-B office market in the regional submarkets throughout Connecticut, Massachusetts and New York. This is in-line with national data which shows there was net occupancy growth during Q2-2017 in the U.S. office market as a whole, according to Cushman & Wakefield. As the number of jobs created rises nationally – 222,000 jobs were created in June 2017 alone – assets in secondary markets offering easy access to transportation are increasingly in demand with value added investors.
Investors continue to find viable opportunities to invest in Class-B and Class-C assets in Greater New Haven which offer the opportunity to make capital improvements, raise asking rents and generate higher returns. This year Northeast Private Client Group has closed a number of high-profile transactions in the New Haven submarket, including the sale of the iconic “Exchange Place” at 123-127 Church Street for $6,388,000 on March 29; the sale of 245 Whitney Avenue for $2,310,000 on April 12; and the sale of 101 Orange Street for $2,131,500 on May 10.
As the first quarter of 2017 draws to a close, multifamily assets continue to trade at record high rates in both Boston and New York City. As many investors explore opportunities in neighboring communities where undervalued Class-B and Class-C assets offer the opportunity to make modest capital improvements, raise asking rents and generate returns, markets such as Framingham and Worcester are thriving. In 2016, Worcester and Framingham ranked first and second among I-495 corridor submarkets for transaction volume in the $1 million to $10 million range. In November 2016, MetroWest Daily News reported commercial property values in Framingham had risen close to 12-percent per a review by the town’s assessing department.