Appetite For Atlanta Apartments Continues To Mount
Apartment investors are continuing to snap up apartment properties in Metro Atlanta, inside and outside the city limits. The activity is pumping up the price tags for apartments throughout the metro area. Average sales price per apartment unit has risen to nearly $122K through the first half of 2019, a 16% increase since June of last year, according to a recent Marcus & Millichap report. Even with average capitalization rates dipping into the high-5% range — the lower the percentage, the lower the expected rate of return — investors are still scouting the market for value-add opportunities, Marcus & Millichap officials said.
Marcus & Millichap
In-Migration and Job Growth Boost Rental Demand; Builders Add High-End Apartments
Employment growth continues to pace above the national rate. Atlanta’s economic strength has been drawing an increased number of white-collar jobs to the metro, bolstering the high-end apartment market. Since 2014, strong apartment construction has delivered roughly 45,000 new units, more than double the deposit from the previous five years. While builders have been advancing inventory, the metro’s economic growth has expanded the renter pool. Employment gains in the construction and health services sectors have resulted in robust household creation and demand for Class B and C units. Renter demand surpassed the new additions, compressing vacancy 130 basis points over the past five years. Strong in-migration and job creation will support apartment demand, underpinning performance into next year.
Atlanta Draws Buyers With Solid Fundamentals And Broad Range of Inventor
Average pricing on multifamily assets in the Atlanta metro appreciated by 16 percent since June of 2018. The average sales price per unit has risen to nearly $122,000 during the first half of this year. Second quarter trading velocity is up approximately 20 percent from the last year as the market rebounds from a relatively slow trading year in 2018.
Outlook: Private investors looking for value-add opportunities are focusing their attention on the Westside, while institutional buyers will continue to target larger assets in the metro’s higher-priced submarkets.
SIXTY WEST FUNDS
Sixty West Funds focuses on real estate-based development of mixed-used properties, including multi-family residential, hospitality, office, and retail located within designated opportunity zones.
Sixty West Funds currently controls approximately 50 acres in Atlanta’s fast developing Westside. Spread across three sites, potential developments on the land may bring an additional 1,400+ multi-family units to the area. The mixed-use development may also include office, hotel, and other commercial options such as on-site retail space. All three sites are located in designated Opportunity Zones.
Read the full BISNOW article HERE.
Learn more about Sixty West Funds and explore all our targeted properties HERE.