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Market Dynamics provides an examination of key influences on apartment industry performance. You’ll value the perspectives and insights from the MPF Research team, including Greg Willett, an industry expert widely known for his knowledge and expertise in the field. View Market Dynamics online or Sign Up for e-mail delivery as new issues are posted.

Fort Lauderdale Apartments Move Toward Stabilization
October 27, 2009
by Greg Willett

Despite ongoing sizable job losses in the metro, Fort Lauderdale has seen a trickle of demand for apartments during 2009. As of September, the occupied apartment count in Broward County was up by about 710 units from the year-end 2008 result. With employment cuts precluding much new household formation, most of the demand seems to have stemmed from households returning to the apartment market from the shadow stock of individually owned condos offered for rent.

After Fort Lauderdale's apartment occupancy rate took a stunning hit that drained about 6 percentage points from the overall performance between early 2006 and late 2008, occupancy has been quite steady throughout 2009. September's figure of 92.7 percent, while low, exactly matched the reading seen at the beginning of the year. The fall 2009 occupancy levels across most Broward County neighborhoods actually were in reasonably decent shape, with the metro's average figure held down by the 88.9 percent rate recorded in the city of Fort Lauderdale, which has some sizable recent completions still in initial lease-up.

Following the same pattern seen in occupancy change across Broward County, rents are showing signs of stabilization, after big cuts occurred previously. Measuring change on a same-store basis, effective rents as of September were down only about 1 percent from the rates seen at the start of the year, though annual change still showed a loss near the 4 percent mark due to late 2008's major difficulties.

While it will take the return of new job formation for Broward County to make much progress filling in the hole that's been dug in apartment market fundamentals, the metro does rank among the spots where the hole really isn't getting meaningfully deeper.

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