AAGO market trends MARKET BEAT Multi-Family Market Vital Signs !"#$%&'($)#*+,#-&.,/+)&0",-#)12#3",&45&'($)#*+,#&'--"23$#3",& By MyRentComps.com Apartments Trying To Keep Up With Demand! !"#$%&'(%)!**+,-#%-+() .)/(-%*)/0) 1$+"'$%-'*) /0) 0+2(%-'*) 0+3'$'4) 567895!!)8+2%:'#*%)5;+$-4#)!"#$%&'(%)!**+,-#%-+() <=>?@A)) ??) B) 567!!CD)!"#$%&'(%)!**+,-#%-+()+E)C$'#%'$)D$;#(4+) =F>@BB)) FG) F) 567H!!!)H#I)!$'#)!"#$%&'(%)!**+,-#%-+() =J>KBG)) B@) =<) 56750!!)5-$*%)0+#*%)!"#$%&'(%)!**+,-#%-+() A>A<<)) J@?)) <=) F) In January’s Market Beat Article, we laid out MF Permitting by year and population !"#$%&'($)#*+,#-&.,/+)&0",-#)12#3",&45&'($)#*+,#&'--"23$#3",& 56780!!)8"#,')0+#*%)!"#$%&'(%)!**+,-#%-+() K>==G)) =B) F) !"#$%&'(%)!**+,-#%-+() .)/(-%*)/0) 1$+"'$%-'*) 0+2(%-'*) growth that showed Permitting in 2018 reaching its highest level since 1999 and 56790!!)9&'$#;4)0+#*%)!"#$%&'(%)!**+,-#%-+() =>ABF)) /0) =J)0+3'$'4) B) over 1,600 people moving into the 5-county area every week. 567N05!!)N+$%:)0'(%$#;)5;+$-4#)!"#$%&'(%)!**+,-#%-+() =><@A)) 567895!!)8+2%:'#*%)5;+$-4#)!"#$%&'(%)!**+,-#%-+() <=>?@A)) ??) A) B) ==) In this month’s article we will take a look at some of the numbers involved with the 567!!CD)!"#$%&'(%)!**+,-#%-+()+E)C$'#%'$)D$;#(4+) 567H0OP!)H#I)0+2(%I)O2;%-7P+2*-(Q)!**+,-#%-+() ))))))))))))AK=)) =F>@BB)) FG) B) F) A) current state of development affairs statewide and in the 5 counties in AAGO. As 567H!!!)H#I)!$'#)!"#$%&'(%)!**+,-#%-+() 56700!!)0#"-%#;)0-%I)!"#$%&'(%)!**+,-#%-+() ))))))))))))BG=)) =J>KBG)) B@) K) =<) ?) shown in Table 1, South East Apartment Association (SEFAA) covering Palm Beach, 56750!!)5-$*%)0+#*%)!"#$%&'(%)!**+,-#%-+() C$#(4)R+%#;) AG>JAG)) A>A<<)) J@?)) <=) F) !"#$%&'()&*+(,*-./*+(01*+2/.%34(51%64(!7./8(9:#./.&3()&*+(93/*/&(51;&3/7&1/(0<;.3"$3=>2)&1/,"7-3(?=@A@A( construction at 21,896 units in 88 properties. 56780!!)8"#,')0+#*%)!"#$%&'(%)!**+,-#%-+() K>==G)) =B) F) !"#$%&'($)#*+,#-&.,/+)&0",-#)12#3",&45&'($)#*+,#&'--"23$#3",& !$4%+&6& 56790!!)9&'$#;4)0+#*%)!"#$%&'(%)!**+,-#%-+() =>ABF)) =J) B) .)/(-%*)/0)in1$+"'$%-'*) The 5-county area making up!"#$%&'(%)!**+,-#%-+() AAGO has 15,944 units under construction 57/0) 0+2(%-'*) 0+3'$'4) 567N05!!)N+$%:)0'(%$#;)5;+$-4#)!"#$%&'(%)!**+,-#%-+() =><@A)) A) ==) projects. This is followed by 10,347 units in 49 projects in the Bay Area Apartment 567895!!)8+2%:'#*%)5;+$-4#)!"#$%&'(%)!**+,-#%-+() <=>?@A)) ??)567H0OP!)H#I)0+2(%I)O2;%-7P+2*-(Q)!**+,-#%-+() B) ))))))))))))AK=)) B) A) Association (BAAA) Covering 567!!CD)!"#$%&'(%)!**+,-#%-+()+E)C$'#%'$)D$;#(4+) Tampa Bay area and the North Port–Sarasota– =F>@BB)) FG) F) 56700!!)0#"-%#;)0-%I)!"#$%&'(%)!**+,-#%-+() ))))))))))))BG=)) K) ?) 567H!!!)H#I)!$'#)!"#$%&'(%)!**+,-#%-+() =J>KBG)) B@) =<) Bradenton MSA. AG>JAG)) A<<)) J@?)) !"#$%&'()&*+(,*-./*+(01*+2/.%34(51%64(!7./8(9:#./.&3()&*+(93/*/&(51;&3/7&1/(0<;.3"$3=>2)&1/,"7-3(?=@A@A( 56780!!)8"#,')0+#*%)!"#$%&'(%)!**+,-#%-+() K>==G)) =B) F) As of March 2020, we show 15,944 Apartments currently under construction in the =J) 56790!!)9&'$#;4)0+#*%)!"#$%&'(%)!**+,-#%-+() =>ABF)) B) !$4%+&6& 567N05!!)N+$%:)0'(%$#;)5;+$-4#)!"#$%&'(%)!**+,-#%-+() ==) 5 county AAGO region. As shown in Table 2 below, Orange County has the=><@A)) greatest A) 567H0OP!)H#I)0+2(%I)O2;%-7P+2*-(Q)!**+,-#%-+() A) number of units and properties under construction, and more than ))))))))))))AK=)) the other 4 B)K) !"#$%&'(%*)/(4'$)0+(*%$2,%-+()HI)0+2(%I)!!CD) 56700!!)0#"-%#;)0-%I)!"#$%&'(%)!**+,-#%-+() ))))))))))))BG=)) ?) &''CD&&6>EFGG&'H'JAG)) J=?) )) )) ))@><@K)) available to rent by the end of 2020, 4,938 by the end of 2021, 384 by 2022 and 235 by 2023. These numbers @+,3")& !"#$%&'()&*+(,*-./*+(01*+2/.%34(51%64(!7./8(9:#./.&3()&*+(93/*/&(51;&3/7&1/(0<;.3"$3=>2)&1/,"7-3(?=@A@A( )D*,'+;#)) ))=>GG?)) ))))=>J=A)) ))K?B)) )) ))K>=G?)) 'A")/$4%+& do not count the large number of properties going through!$4%+&6 the& entitlement stage which will be addressed 'A")/$4%+& )8'&-(+;')) ))=>KBB)) ))))))))AB?)) )) ))<K?G)) )))))B>@K?)) ))K?B)) ))@BB)) to national REITs. The top three developers in the 5-county area that have units Under Construction are 1) 1$+"'$%-'*)/(4'$)0+(*%$2,%-+()HI)0+2(%I)!!CD) !"#$%&'(%*)/(4'$)0+(*%$2,%-+()HI)0+2(%I)!!CD) &''CD&&6>EFGG&'H'J=?) )) )) )) ))@><@K)) =K) Properties (978 Units) and 3) Wood Partners (656 Units). As shown in Chart 1 above, 85% @+,3")& of the 15,944 units )D*,'+;#)) @) K) =) :$);+#&<$#+& )D*,'+;#)) ))=>GG?)) ))))=>J=A)) ))K?B)) )) ))K>=G?)) 'A")/$4%+& )8'&-(+;')) F) <) )) =) ?) =>?&under construction, are market rate units. 7?& Of the 15,944 units 'A")/$4%+& )8'&-(+;')) ))=>KBB)) <)))))))))AB?)) =) )) )) ))<EFGG&'H'J=?) the diminishing number of good infill 6#U')C$#(4)R+%#;) )))))BAK)) K@) ))A><@K)) =) =) @+,3")& C$#(4)R+%#;) =J>K?G)) )))))B>@K?)) ))K?B)) ))@BB)) )D*,'+;#)) ))=>GG?)) ))))=>J=A)) ))K?B)) )) ))K>=G?)) 'A")/$4%+& !"#$%&'()&*+(,*-./*+(01*+2/.%34(51%64(!7./8(9:#./.&3()&*+(93/*/&( sites. We expect the trend from Garden/Surfaced Park to 4 to 6 'A")/$4%+& )8'&-(+;')) ))=>KBB)) ))))))))AB?)) )) ))<2)&1/,"7-3(?=@A@A( 1$+"'$%-'*)/(4'$)0+(*%$2,%-+()HI)0+2(%I)!!CD) @#1/+,#& 9?& )T+;2*-#)) )))))FK?G)) permits to rise in ))@BB)) and expect that new )D$#(Q')) )))))B>@K?)) ))K?B)) )D*,'+;#)) @) K) =) )) growth.=K) :$);+#&<$#+& 1$+"'$%-'*)/(4'$)0+(*%$2,%-+()HI)0+2(%I)!!CD) apartment starts will continue at higher levels to keep up with both employment growth and population 9*%)0+&";'%-+() 7878& 7876& 7877& 7879& )8'&-(+;')) F) <) )) =) ?) =>?& !"#$%& =J) )) )) KJ) <) =) )) K) The top)D$#(Q')) 3 submarkets ?& has the)8'&-(+;')) most units under construction followed C$#(4)R+%#;) K@) =A) =) =) FG) T+;2*-#) <) =) )) )) K) construction in Horizons West, American Campus Communities is building 1,323 units called Flamingo Crossings that will !"#$%&'()&*+(,*-./*+(01*+2/.%34(51%64(!7./8(9:#./.&3()&*+(93/*/&( 0:#$%)=) 6#U') K) )) )) )) K) 51;&3/7&1/(0<;.3"$3=>2)&1/,"7-3(?=@A@A( C$#(4)R+%#;) K@) =A) as Student =) =) Housing. FG) be rented to!"#$%&'()&*+(,*-./*+(01*+2/.%34(51%64(!7./8(9:#./.&3()&*+(93/*/&( Disney Employees !$4%+&7& 51;&3/7&1/(0<;.3"$3=>2)&1/,"7-3(?=@A@A( When factored together, the population increase of over 1,600 people moving to the 5-county AAGO area !$4%+&7 & !"(&9&@14*$);+#-&.0&3,&''CD& every week and strong employment numbers keeping Orlando #1 in the Country for Job Growth should @14*$);+#& .,3#-& H)"(+)#3+-& ?&"K& .0& .0& #"#$%& allow the planned properties to get the equity and debt to start construction on additional apartment units. P+$-V+(*)L'*%) <>KBF)) F) =BWGX) Apartment Managers/Owners; Go to AAGO.Org (Under Resources) and get your FREE AAGO/ =>BA=)) B) @WBJG)) F) ?W?X) simply verifying your property data. R+")K)82[&#$U'%*) F><=K)) =B) KGK=)) BK) AGWKX) Source: AAGO OMS/MyRentComps.com; Smith Equities Real Estate Investment Advisors, Robert E. Smith, R+%#;)#;;)+%:'$)82[&#$U'%*) R+%#;)!!CD) )=F>@BB)) FG) =JJWJX) CCIM Broker www.smitheq.com; Real Capital Analytics, Inc. !$4%+&9& 40 The Key www.aago.org

April, May, June 2020 Key Magazine