Properties Sampled 395 | Units Sampled 85,521 | Submarkets 9
1st Quarter 2015 Columbus Apartment Trends
- Effective Rent $788
- Occupancy 95.2%
- Annual Job Change 23,000 jobs
- Annual Permits 3,308 units
- Annual Demand 3,956 units
- Annual Completions 3,068 units
1st Quarter Columbus Performance Highlights
Columbus’ economy was one of the nation’s most stable during the recession, and the metro produced solid growth coming out of the downturn. A main reason for Columbus’ economic health is the fact that Columbus is the home of both the fifth-largest university in the nation (Ohio State University) and the state government. General economic health propped up occupancy rates and spurred along rent growth levels in the Columbus apartment market. That attracted developers to the metro, causing construction volumes to soar to decade-high numbers. As many of those projects have begun to complete, increased supply volumes have started to impact overall fundamentals. On one hand, the metro has generally seen solid leasing activity among the new properties, which has helped to keep apartment occupancy healthy. On the other hand, operators have held to moderate rent growth levels in an apparent effort to preserve occupancy. Looking forward, apartment development will likely remain a factor through early 2016, particularly for the 2000+ product age niche and the handful of high-development submarkets. But the impact shouldn’t be especially severe given Columbus’ demographic and economic tailwinds, which makes the Ohio state capital one of the Midwest’s most attractive apartment markets long term.
What changed this quarter? Supply outpaced demand in 1st quarter, sending occupancy down 0.3 points quarter-over-quarter. While occupancy and rent growth remain in solid shape, new supply coming on board is beginning to weigh on Columbus’ fundamentals. Meanwhile, rental rates went up 0.4% quarter-over-quarter.
Source: MPF Research, www.mpfresearch.com