Busy City

Holding Steady Multifamily starts decrease minimally from ’05 to ’06.

The volume of multifamily construction remains strong and steady. In 2006, starts for buildings of five or more units decreased slightly from ’05, down 6 percent from 311,400 to 293,000, according to data from the U.S. Census Bureau. The highest number of starts occurred in January with 30,100 units; the lowest in February with 19,100 units.

MULTIFAMILY STARTS – Source: U.S. Census The change from ’05 to ’06 is very minimal given the room for error and small sampling used to gather the statistics, says Mark Obrinksy, the National Multi Housing Council’s chief economist and vice president of research. “This is the steadiest 10 years of multifamily construction that we have ever seen,” he says. “We have gotten to a point where it seems the industry is producing roughly the right number of units for the long-term increase in demand.”

Obrinsky expects this year’s construction pace to remain steady. “I’d be nuts to predict anything else,” he says. Developer Sam Gershwin, president of Florham Park, N.J.-based Westminster Communities, agrees. He does predict starts to increase towards the end of the year. “A lot of the existing inventory of built but unsold product will start being consumed by buyers and therefore there will be an increase in permits and starts,” Gershwin says. —Rachel Z. Azoff

Source: Yahoo! Finance

Stat to Watch

ELITE STATUS

CB Richard Ellis joins the S&P 500.

UPWARD JOURNEY Landing a spot on the S&P 500 wasn’t just a milestone for CB Richard Ellis Group. It also marked a monumental moment for the stock index: CBRE is the only commercial real estate services firm included in the index.

“Real estate activities are part of the financial sector and are a key part of the economy and the S&P 500 index,” says David Guarino, a spokesman for Standard & Poor’s. “The addition of CBRE improves the representation of real estate in the S&P 500.” The index, which also includes a handful of multifamily REITs, tracks the performance of 500 selected American companies in leading industries. (CBRE replaced Fisher Scientific International on the index.)

For CBRE, the spot on the index reinforces its successful track record. “We are pleased to be recognized among the premier business services companies in the U.S.,” said Brett White, the company’s president and CEO. “We have achieved a consistent record of growth and strong performance built on a commitment to superior client service.” And the listing, of course, bodes well for increased investment interest in the company.

The company’s addition to the list wasn’t determined based on the company’s recent purchase of Trammell Crow Co., says Robert W. McGrath, CBRE’s senior director of corporate communications. CBRE made the list in November, before the company’s acquisition of Trammell Crow. —Rachel Z. Azoff