DAYTON OVERVIEW

1| Prior to the pandemic, Dayton’s real gross metropolitan product grew at an average annual rate of 1.6% from 2015 to 2019. During that same five-year period, job growth averaged 1.0% annually, with roughly 3,900 jobs added on average each year. In 2020, COVID-19 mitigation measures and limited business activity caused the local economy to contract as much as 9.6% year-over-year in 2nd quarter. In 2022, the metros inflation-adjusted economic output contracted 0.8%. 2| At the same time, the metro recorded a net gain of 2,900 jobs, expanding the employment base 0.8%. 3| Dayton’s unemployment rate in November 2022 declined 0.4 points year-over-year to 3.2%, below the national average of 3.4%. 4| Job gains in Dayton were most pronounced in the Leisure/Hospitality Services sector followed by Government and Professional/Business Services. 5| Due to job losses stemming from the pandemic, Dayton’s current employment base now sits roughly 5,100 jobs or about 1% below the pre-pandemic level in February 2020.

Rent Growth

Q1 2022 Market Snapshot

1| Over the past five years, annual change in effective asking rents in Dayton ranged from 1.9% to 10.3%. In 4th quarter 2022, effective asking rents for new leases were up 8.4% year-over-year. That annual rent performance was well above the market’s five-year average of 4.8%. 2| Product classes in Dayton, Class A led for rent performance over the past five years. In 4th quarter 2022, annual effective rent change was fairly even across the board, registering at 8.3% in Class A units, 8.2% in Class B units and 8.7% in Class C units. 3|

Among submarkets, the strongest annual rent change performances over the past year were in Northwest Dayton, North Dayton/Miami County and Greene County, all at 10% or greater. 4| The weakest performances were in Central Dayton/Kettering and South Montgomery County, but both were around 6.5%.

Occupancy

1| Occupancy in the Dayton apartment market has ranged from 93.9% to 98.0% over the past five years, averaging 96.5% during that period. Over the past year, occupancy lost 1.8 points, with the 4th quarter 2022 rate landing at 96.2%. 2| Product classes in Dayton, 4th quarter 2022 occupancy registered at 95.3% in Class A units, 96.5% in Class B units and 96.7% in Class C units. 3|

In 4th quarter 2022 occupancy was strongest in Greene County and Central Dayton/Kettering. 4| The weakest reading was in Northwest Dayton at just less than 94%.

1| New apartment completions in Dayton were modest recently, as 412 units delivered in 2022. Completions over the past year expanded the local inventory base 0.7%. 2| In the past year, supply was limited to Central Dayton/Kettering and Greene County. 3| Annual new supply averaged 553 units, and annual inventory growth averaged 1.0% over the past five years. During that period, new supply was concentrated in South Montgomery County and Central Dayton/Kettering, which received 64% of the markets total completions. 4| At the end of 2022, there were 886 units under construction with 661 of those units scheduled to complete in the next four quarters.

412 units completed in past 12 months

886 units currently in progress

DEVELOPMENT PIPELINE MAP - DAYTON