Properties Samples 372 | Units Sampled 84,528 | Submarkets 9
1st Quarter 2014 Columbus Apartment Trends
- Effective Rent $769
- Occupancy 94.5%
- Annual Job Change 9,600 jobs
- Annual Permits 3,947 units
- Annual Demand 3,027 units
- Annual Completions 4,042 units
1st Quarter Columbus Performance Highlights
Columbus’s economy was one of the nation’s most stable during the recession, and the metro produced solid growth coming out of the downturn. 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 seen strong leasing activity among the new properties, which has helped to keep apartment fundamentals in healthy shape. Still, the metro hasn’t been able to match concurrent supply volumes, causing occupancy to decline a bit. The market saw some backtracking among middle-tier units, due perhaps in part to renters moving up to top-tier product. Meanwhile, most market segments saw improved rent growth performances, despite lingering headwinds from supply and construction. Apartment development will likely remain a limiting factor through 2014, particularly among 2000+ product niche and the handful of high-development submarkets. But the impact shouldn’t be especially severe given Columbus’s demographic and economic tailwinds, which make the Ohio state capital one of the Midwest’s most attractive apartment markets long term.
What changed this quarter? Negative quarterly demand (-748 units) accompanied moderate supply (671 units). The subsequent occupancy of 94.5% was down 0.9 points quarter-over-quarter. Meanwhile, rent growth registered at 1.2% quarter-over-quarter, sending the year-over-year rent increase up to a healthy 3.0%.
Source: MPF Research, www.mpfresearch.com