STAT TO WATCH
Up, Up, And Away
Multifamily investor activity picks up speed. For the fourth quarter in a row, senior apartment executives report improvements in key market indicators, including sales of multifamily buildings.
According to Mark Obrinsky, chief economist at the National Multi Housing Council in Washington, D.C., which produces a quarterly sales volume index, 41 percent of respondents observed higher sales volume in their markets in the period between April and July 2005 than they had in the previous quarter.
“We have seen record buying,” Obrinsky said. “We have the condo converters” on a roll in many markets around the country, and “we also have people buying apartments because they think down the road, [certain markets] will be the place to be.”
“We have been actively but cautiously buying apartment communities,” noted Lili Dunn, AvalonBay’s senior vice president and managing director for investments. Since the Alexandria, Va.-based company in March closed a value-added apartment acquisition fund with a total investment capacity of $940 million, Dunn said, AvalonBay has purchased five multifamily communities in four cities: Redmond, Wash.; Columbia, Md.; Los Angeles; and Chicago. The total value of these communities is approximately $150 million, she added.
AvalonBay’s buying spree may not yet be over. “We’re looking [for desirable properties] in all of our markets, but the timing depends on the fundamentals of those markets,” Dunn said.
Obrinsky added that this is only the fifth time in the six years that NMHC has conducted the quarterly survey that all four indexes–occupancy rates, debt, and equity availability, as well as sales volume–have exhibited improving conditions.
–Amy Rogers Nazarov