westwood offering memorandum
CONTENTS
LEAD AGENTS
Jordan Dickman
First Vice President Investments
Cincinnati Office
D. 513.878.7735
jordan.dickman@marcusmillichap.com
Nick Andrews
First Vice President Investments
Cincinnati Office
D. 513.878.7741
nicholas.andrews@marcusmillichap.com
Austin Sum
Senior Associate
Cincinnati Office
D. 513.878.7747
austin.sum@marcusmillichap.com
“OUR COMMITMENT IS TO HELP OUR CLIENTS CREATE
AND PRESERVE WEALTH BY PROVIDING THEM WITH
THE BEST REAL ESTATE INVESTMENT SALES, FINANCING, RESEARCH AND ADVISORY SERVICES AVAILABLE.”
NON-ENDORSEMENT & DISCLAIMER NOTICE
CONFIDENTIALITY DISCLAIMER
THIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS OF VALUE AND SHOULD NOT BE CONSIDERED AN APPRAISAL. This information has been secured from sources we believe to be reliable, but we make no representations or warranties, express or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies.
NON-ENDORSEMENT NOTICE
Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.
01 - PORTFOLIO SUMMARY 02 - WESTWOOD & BROOKWOOD 03 - COMPETITORS 04 - COLLEGE CREST & VERNON SECTIONS
06 20 32 40
CALABASAS, CALIFORNIA | HQ 2,500 | EMPLOYEES 80+ | OFFICES
UNRIVALED SUCCESS IN THE MIDWEST
YOUR TEAM
JORDAN DICKMAN
FIRST VICE PRESIDENTS DIRECTOR, NMHG
NICK ANDREWS
FIRST VICE PRESIDENTS DIRECTOR, NMHG
CORPORATE SUPPORT
LIZ POPP
MIDWEST OPERATIONS MANAGER
JOSH CARUANA
VICE PRESIDENT
REGIONAL MANAGER
INDIANAPOLIS | CINCINNATI | LOUISVILLE | ST LOUIS | KANSAS CITY
AUSTIN SUM
SENIOR INVESTMENT ASSOCIATE
BRIAN JOHNSTON
INVESTMENT ASSOCIATE
AUSTIN Hall
INVESTMENT ASSOCIATE
ALDEN SIMMS
INVESTMENT ASSOCIATE
BROKER SUPPORT
SAM PETROSino
VALUATION & RESEARCH
SKyler WILSON
CLIENT RELATIONS MANAGER
JOHN SEBREE
SENIOR VICE PRESIDENT
NATIONAL DIRECTOR
NATIONAL MULTI HOUSING GROUP
MICHAEL GLASS
SENIOR VICE PRESIDENT
MIDWEST DIVISION MANAGER
NATIONAL DIRECTOR, MANUFACTURED HOME COMMUNITIES GROUP
BRITTANY CAMPBELL-KOCH
DIRECTOR OF OPERATIONS
ALEX PAPA
MARKETING COORDINATOR
WESTWOOD
01
WESTWOOD APARTMENTS
westwood EAST
Property Address: 2215-2217 Harrison Ave
City, State, Zip: Cincinnati, Ohio 45211
Submarket: Westwood County: Hamilton County
Year Built/Reno: 1971
Property Type: Market
Number Of Units: 24
Avg Unit Size: 850
Rentable Sqft: 20,400
Number of Parcels: 1
Lot Size (Acres): 0.71 Acres
Occupancy: 88%
# of Buildings: 2
Electric: Property paid
Gas: Property paid
Water/Sewer: Property paid
Trash: Property paid
Cable/Internet: Property paid
Foundation: Concrete slab
Framing: Wood frame
Roof Type/Age: Flat
Exterior: Brick
PROPERTY DETAILS
CINCINNATI, OH 2215 HARRISON AVE | 2217 HARRISON AVE
WESTWOOD EAST
Unit Type # Units Avg. Size In-Place Rent 2 Bed regular 8 850 $814 2 bed cmha 16 13,600 $1,174 All Units 24 $1,054 Unit mix summary
westwood CENTRAL
Property Address: 2520 & 2532 Harrison Ave
City, State, Zip: Cincinnati, Ohio 45211
Submarket: Westwood County: Hamilton County
Year Built/Reno: 1947
Property Type: Market
Number Of Units: 24
Avg Unit Size: 800
Rentable Sqft: 18,600
Number of Parcels: 4
Lot Size (Acres): 0,7 Acres
Occupancy: 96%
# of Buildings: 2
Electric: Property paid
Gas: Property paid
Water/Sewer: Property paid
Trash: Property paid
Cable/Internet: Property paid
Foundation: Concrete slab
Framing: Wood frame
Roof Type/Age: Flat
Exterior: Brick
PROPERTY DETAILS
WESTWOOD CENTRAL CINCINNATI, OH 2532 HARRISON AVE | 2520 HARRISON AVE
Unit Type # Units Avg. Size In-Place Rent 1 Bed 12 700 $704 2 Bed 12 850 $1,143 All Units 24 762 $924 Unit mix summary
local competitors
02
RENT COMPARABLES
1 COURTYARD APTS 2 MIDWAY APTS 3 BRIARWOOD APTS 4 SUNSET RIDGE 5 PANORAMA APTS 6 CANDLEWOOD APTS 7 MONTCLAIR IN THE WOODS 8 RENATA APTS
LOCATIONs LOCAL COMPETITORS
2 1 3 4 7
WESTWOOD APARTMENTS
5 6 8
rent sort ONE bedroom
One Bedroom Property Year Built # Units Avg SF Avg Rent Avg Rent/SF Sunset Ridge 1965 57 637 $866 $1.36 Renata Apartments 1966 100 650 $851 $1.31 Candlewood Apartments 1961 110 750 $851 $1.13 Subject Pro Forma 1947 & 1971 48 700 $835 $1.19 Montclair in the Woods Year Built 61 746 $821 $1.10 Briarwood Apartments 1959 32 600 $806 $1.34 The Courtyard Apartments 1971 48 650 $777 $1.20 Subject Average Effective 1947 & 1971 48 700 $704 $1.01
rent sort two bedroom
Two Bedroom Property Year Built # Units Avg SF Avg Rent Avg Rent/SF Subject Pro Forma 1947 & 1971 48 850 $1,187 $1.40 Subject Average Effective 1947 & 1971 48 850 $1,083 $1.27 Candlewood Apartments 1961 110 950 $1,056 $1.11 Renata Apartments 1966 100 900 $1,056 $1.17 Midway Apartments 1971 36 900 $973 $1.08 The Courtyard Apartments 1971 48 800 $902 $1.13 Montclair in the Woods 1969 61 907 $867 $0.96 Panorama 1969 80 940 $859 $0.91
WESTWOOD & BROOKWOOD COMPETITORS COURTYARD APARTMENTS
UNITS 48 YEAR BUILT 1971 OCCUPANCY 91.1% UNIT MIX UNITS SQFT RENT RENT/SF One Bedroom 4 650 $777 $1.20 Two Bedroom 44 800 $902 $1.13 Apartment Interior Amenities Air Conditioning Oven Balcony Range Heating Common Area Amenities Controlled Access Laundry Facilities 3332 Glenmore Ave Utilities Responsibility Tenant Paid Electric Tenant Paid Gas Tenant Paid Water & Sewer Tenant Paid Trash
WESTWOOD & BROOKWOOD COMPETITORS
APARTMENTS Units 36 Year Built 1971 Occupancy 94.9% UNIT MIX UNITS SQFT RENT RENT/SF Two Bedroom 36 900 $973 $1.08 Apartment Interior Amenities Balcony Vinyl Flooring Air Conditioning Common Area Amenities Laundry Facilities Storage Space Controlled Access 3208-3240 Midway Ave Utilities Responsibility Tenant Paid Electric Tenant Paid Gas Tenant Paid Water & Sewer Tenant Paid Trash
MIDWAY
WESTWOOD & BROOKWOOD COMPETITORS
BRIARWOOD APARTMENTS
UNITS 32 YEAR BUILT 1959 OCCUPANCY 99.3% UNIT MIX UNITS SQFT RENT RENT/SF One Bedroom 32 600 $806 $1.34 Apartment Interior Amenities Air Conditioning Heating Ceiling Fans Cable Ready Storage Units Common Area Amenities Laundry Facilities Maintenance on site Renters Insurance Program Online Services Storage Space 3810-3830 Boudinot Ave Utilities Responsibility Tenant Paid Electric Property Paid Gas Property Paid Water & Sewer Property Paid Trash
WESTWOOD & BROOKWOOD COMPETITORS
SUNSET RIDGE
Units 57 Year Built 1965 Occupancy 91.1% UNIT MIX UNITS SQFT RENT RENT/SF One Bedroom 56 637 $866 $1.36 Two Bedroom 196 942 $1,599 $1.70 Apartment Interior Amenities Smoke Free Storage Units Hardwood Floors Balcony Common Area Amenities Laundry Facilities Controlled Access 24 Hour Availability
Gilsey Ave Utilities Responsibility Tenant Paid Electric Tenant Paid Gas Tenant Paid Water & Sewer Tenant Paid Trash
1751-1759
the financials
03
WESTWOOD - FINANCIALS
UNIT MIX SUMMARY
AVERAGE EFFECTIVE MARKET PROJECTED UNIT TYPE NO. OF UNITS RENTABLE SF TOTAL SF RENT/UNIT RENT/SF TOTAL RENT POTENTIAL RENT/UNIT RENT/SF TOTAL RENT POTENTIAL RENT/UNIT RENT/SF TOTAL RENT POTENTIAL SUMMARY One Bedroom 12 Units 700 SF 8,400 SF $704.17 $1.01 $8,450 $725.00 $1.04 SF $8,700 $835.00 $1.19 SF $10,020 Two Bedroom 36 Units 850 SF 30,600 SF $1,083.66 $1.27 $39,012 $1,147.92 $1.35 SF $41,325 $1,187.50 $1.40 SF $42,750 Totals / Wtd. Averages 48 Units 813 SF 39,000 SF $988.78 $1.22 SF $47,462 $1,042.19 $1.28 SF $50,025 $1,099.38 $1.35 SF $52,770
UNIT DISTRIBUTION
UNIT RENTS
WESTWOOD - FINANCIALS UNIT MIX BREAKDOWN
AVERAGE EFFECTIVE MARKET PROJECTED UNIT TYPE NO. OF UNITS RENTABLE SF TOTAL SF RENT/UNIT RENT/SF TOTAL RENT POTENTIAL RENT/UNIT RENT/SF TOTAL RENT POTENTIAL RENT/UNIT RENT/SF TOTAL RENT POTENTIAL One Bedroom 1BR/1BA - Westwood - Central 12 Units 700 SF 8,400 SF $704.17 $1.01 SF $8,450 $725.00 $1.04 SF $8,700 $835.00 $1.19 SF $10,020 Totals / Wtd. Averages 12 Units 700 SF 8,400 SF $704.17 $1.01 SF $8,450 $725.00 $1.04 SF $8,700 $835.00 $1.19 SF $10,020 Two Bedroom 2BR/1BA - Westwood - Central 1 Units 850 SF 850 SF $775.00 $0.91 SF $775 $775.00 $0.91 SF $775 $1,000.00 $1.18 SF $1,000 2BR/1BA - Westwood - East 8 Units 850 SF 6,800 SF $814.38 $0.96 SF $6,515 $850.00 $1.00 SF $6,800 $1,000.00 $1.18 SF $8,000 2BR/1BA - Westwood - Central - 11 Units 850 SF 9,350 SF $1,176.36 $1.38 SF $12,940 $1,250.00 $1.47 SF $13,750 $1,250.00 $1.47 SF $13,750 2BR/1BA - Westwood - East - CMHA 16 Units 850 SF 13,600 SF $1,173.85 $1.38 SF $18,782 $1,250.00 $1.47 SF $20,000 $1,250.00 $1.47 SF $20,000 Totals / Wtd. Averages 36 Units 850 SF 30,600 SF $1,083.66 $1.27 SF $39,012 $1,147.92 $1.35 SF $41,325 $1,187.50 $1.40 SF $42,750
YEAR 1 GROSS POTENTIAL RENT % of GPR Per Unit % of GPR Per Unit All Units at Market Rent $630,000 RR 13,125 $633,240 13,193 Gain (Loss) to Lease ($33,240) 5.28% (693) ($12,665) 2.00% (264) GROSS SCHEDULED RENT $596,760 RR Note 2 12,433 $620,575 12,929 Other Income Late / NSF fees $7,934 T12 1.33% 165 $8,172 1.32% 170 Laundry Income $5,488 T12 0.92% 114 $5,653 0.91% 118 Total Other Income $13,422 2.25% 280 $13,825 2.23% 288 GROSS POTENTIAL INCOME $610,182 12,712 $634,400 13,217 Physical Vacancy ($35,806) RR 6.00% (746) ($31,029) 5.00% (646) Bad Debt $0 0.00% 0 ($6,206) 1.00% (129) EFFECTIVE GROSS INCOME $574,377 88.72% 11,966 $597,166 92.00% 12,441 NON-CONTROLLABLE Real Estate Taxes % of EGI Per Unit % of EGI 2020 Taxes Paid $50,784 Auditor 8.84% 1,058 $50,784 8.50% 1,058 Total Real Estate Taxes $50,784 8.84% 1,058 $50,784 8.50% 1,058 Insurance $12,795 T12 2.23% 267 $19,200 3.22% 400 Utilities Gas & Electric $24,080 T12 4.19% 502 $24,561 4.11% 512 Water & Sewage $38,534 T12 6.71% 803 $39,305 6.58% 819 Trash Removal $6,070 T12 1.06% 126 $6,191 1.04% 129 Total Utilities $68,684 11.96% 1,431 $70,057 11.73% 1,460 Total Non-Controllable $132,263 23.03% 2,755 $140,041 23.45% 2,918 CONTROLLABLE Contract Services Landscaping/Grounds/Snow $10,475 T12 1.82% 218 $8,400 1.41% 175 Pest Control $6,911 T12 1.20% 144 $3,600 0.60% 75 Total Contract Services $17,386 3.03% 362 $12,000 2.01% 250 Repairs & Maintenance $52,267 T12 9.10% 1,089 $31,200 5.22% 650 Marketing & Promotion $0 0.00% 0 $3,600 0.60% 75 On-Site Payroll $89,956 T12 15.66% 1,874 $52,800 8.84% 1,100 Payroll Taxes & Benefits $0 0.00% 0 $4,800 0.80% 100 General & Administrative $3,469 T12 0.60% 72 $4,800 0.80% 100 Management Fee $41,660 T12 7.25% 868 $47,773 8.00% 995 Replacement & Reserves $17,064 T12 2.97% 255 $12,485 2.09% 260 Total Controllable $221,801 38.62% 4,520 $169,458 28.38% 3,530 TOTAL EXPENSES $354,064 61.64% 7,376 $309,499 51.83% 6,448 NET OPERATING INCOME $220,313 38.36% 4,590 $287,666 48.17% 5,993 EXPENSE INCOME INCOME
WESTWOODFINANCIALS CURRENT RENT ROLL: AS OF JULY 1, 2023 W/ CHMA ADJ. RENT ROLL INCOME AND EXPENSES: JULY 2022 - JUNE 2023
& EXPENSES
# NOTE
UNDERWRITING NOTES
1 Replacement & Reserves: added based on market norm of $255 per unit per year
2 Gross Scheduled Rent: Rent roll adjusted with updated CHMA rents
YEAR 2 YEAR 3 % of GPR Per Unit % of GPR Per Unit $652,237 13,588 $671,804 13,996 ($13,045) 2.00% (272) ($13,436) 2.00% (280) $639,192 13,317 $658,368 13,716 $8,417 1.32% 175 $8,670 1.32% 181 $5,822 0.91% 121 $5,997 0.91% 125 $14,240 2.23% 297 $14,667 2.23% 306 $653,432 13,613 $673,035 14,022 ($31,960) 5.00% (666) ($32,918) 5.00% (686) ($6,392) 1.00% (133) ($6,584) 1.00% (137) $615,081 92.00% 12,814 $633,533 92.00% 13,199 % of EGI Per Unit % of EGI Per Unit $50,784 8.26% 1,058 $50,784 8.26% 1,058 $50,784 8.26% 1,058 $50,784 8.26% 1,058 $19,584 3.18% 408 $19,976 3.25% 416 $25,053 4.07% 522 $25,554 4.15% 532 $40,091 6.52% 835 $40,893 6.65% 852 $6,315 1.03% 132 $6,441 1.05% 134 $71,458 11.62% 1,489 $72,888 11.85% 1,518 $141,826 23.06% 2,955 $143,647 23.35% 2,993 $8,568 1.39% 179 $8,739 1.42% 182 $3,672 0.60% 77 $3,745 0.61% 78 $12,240 1.99% 255 $12,485 2.03% 260 $31,824 5.17% 663 $32,460 5.28% 676 $3,672 0.60% 77 $3,745 0.61% 78 $53,856 8.76% 1,122 $54,933 8.93% 1,144 $4,896 0.80% 102 $4,994 0.81% 104 $4,896 0.80% 102 $4,994 0.81% 104 $49,206 8.00% 1,025 $50,683 8.00% 1,025 $12,734 2.07% 265 $12,989 2.11% 271 $173,325 28.18% 3,611 $177,283 28.58% 3,663 $315,151 51.24% 6,566 $320,931 52.18% 6,686 $299,929 48.76% 6,249 $312,602 50.82% 6,513
CURRENT YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 7 YR 8 YR 9 YR 10 YE JUN-2024 YE JUN-2025 YE JUN-2026 YE JUN-2027 YE JUN-2028 YE JUN-2029 YE JUN-2030 YE JUN-2031 YE JUN-2032 YE JUN-2033 GROSS POTENTIAL RENT All Units at Market Rent $630,000 $633,240 $652,237 $671,804 $691,958 $712,717 $734,099 $756,122 $778,805 $802,169 $826,235 Gain (Loss) to Lease ($33,240) ($12,665) ($13,045) ($13,436) ($13,839) ($14,254) ($14,682) ($15,122) ($15,576) ($16,043) ($16,525) GROSS SCHEDULED RENT $596,760 $620,575 $639,192 $658,368 $678,119 $698,463 $719,417 $740,999 $763,229 $786,126 $809,710 Total Other Income $13,422 $13,825 $14,240 $14,667 $14,960 $15,259 $15,565 $15,876 $16,193 $16,517 $16,848 GROSS POTENTIAL INCOME $610,182 $634,400 $653,432 $673,035 $693,079 $713,722 $734,981 $756,875 $779,423 $802,643 $826,557 Physical Vacancy ($35,806) ($31,029) ($31,960) ($32,918) ($33,906) ($34,923) ($35,971) ($37,050) ($38,161) ($39,306) ($40,485) Bad Debt $0 ($6,206) ($6,392) ($6,584) ($6,781) ($6,985) ($7,194) ($7,410) ($7,632) ($7,861) ($8,097) EFFECTIVE GROSS INCOME $574,377 $597,166 $615,081 $633,533 $652,392 $671,814 $691,816 $712,415 $733,629 $755,476 $777,975 Real Estate Taxes $50,784 $50,784 $50,784 $50,784 $51,800 $52,836 $53,892 $54,970 $56,070 $57,191 $58,335 Insurance $12,795 $19,200 $19,584 $19,976 $20,375 $20,783 $21,198 $21,622 $22,055 $22,496 $22,946 Utilities $68,684 $70,057 $71,458 $72,888 $74,345 $75,832 $77,349 $78,896 $80,474 $82,083 $83,725 Contract Services $17,386 $12,000 $12,240 $12,485 $12,734 $12,989 $13,249 $13,514 $13,784 $14,060 $14,341 Repairs & Maintenance $52,267 $31,200 $31,824 $32,460 $33,110 $33,772 $34,447 $35,136 $35,839 $36,556 $37,287 Marketing & Promotion $0 $3,600 $3,672 $3,745 $3,820 $3,897 $3,975 $4,054 $4,135 $4,218 $4,302 On-Site Payroll $89,956 $52,800 $53,856 $54,933 $56,032 $57,152 $58,295 $59,461 $60,651 $61,864 $63,101 Payroll Taxes & Benefits $0 $4,800 $4,896 $4,994 $5,094 $5,196 $5,300 $5,406 $5,514 $5,624 $5,736 General & Administrative $3,469 $4,800 $4,896 $4,994 $5,094 $5,196 $5,300 $5,406 $5,514 $5,624 $5,736 Management Fee $41,660 $47,773 $49,206 $50,683 $52,191 $53,745 $55,345 $56,993 $58,690 $60,438 $62,238 Replacement & Reserves $17,064 $12,485 $12,734 $12,989 $13,249 $13,514 $13,784 $14,060 $14,341 $14,628 $14,920 TOTAL EXPENSES $354,064 $309,499 $315,151 $320,931 $327,844 $334,911 $342,135 $349,518 $357,066 $364,781 $372,668 NET OPERATING INCOME $220,313 $287,666 $299,929 $312,602 $324,548 $336,903 $349,682 $362,897 $376,563 $390,695 $405,307 INCOME EXPENSE WESTWOODFINANCIALS
CASH FLOW
YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 7 YR 8 YR 9 Income Gross Potential Rent 0.51% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% (Loss) / Gain to Lease* 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% Other Income 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Expenses Expenses 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% Management Fee** 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% CASH FLOW PROJECTION GROWTH RATE ASSUMPTIONS YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 7 YR 8 YR 9 Physical Vacancy 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% Non-Revenue Units 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Bad Debt 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% Concessions Allowance 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Total Economic Loss 6.00% 6.00% 6.00% 6.00% 6.00% 6.00% 6.00% 6.00% 6.00%
CASH FLOW PROJECTION GROWTH RATE ASSUMPTIONS
local market
04
CINCINNATI, Ohio
The steady and stable nature of the Cincinnati apartment market was undoubtfully a benefit through 2020. The MSA saw a 2.7% annual increase in effective asking rents on new leases which matched the market’s norm for the 2010s decade. This growth put Cincinnati at #14 amongst the 50 largest markets for rent growth in 2020. Although occupancy was down 0.3 points from the prior year’s rate, the 4th quarter 2020 occupancy rate (96.4%) ranked #11 among the top 50 markets and #3 regionally. Only Q1 2020 saw net move-outs, although that’s typically the case in the local
market due to seasonal demand patterns, the three subsequent quarters saw huge demand and absorption totaled 1,563 units. That is 38% above the 20-year norm for annual absorption. During the peak of the pandemic challenges the job market declined 4.6%, this ranked Cincinnati 3rd best among the Midwest and was significantly better than the national average of 5.8%.
ECONOMIC OVERVIEW
Prior to the pandemic, Cincinnati’s real gross metropolitan prod uct grew at an average annual rate of 1.8% from 2015 to 2019. During that same five-year period, job growth averaged 1.4% annually, with roughly 15,500 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 9.7% year-over-year in 2nd quarter. In the year-ending 3rd quarter 2022, the metro’s inflation-adjusted economic output expand ed 0.3%. At the same time, the metro recorded a net gain of 1,400 jobs, expanding the employment base 0.1%. Cincinnati’s unemployment rate in August 2022 declined 0.5 points yearover-year to 3.8%, on par with the national average of 3.8%. During the past year, job gains in Cincinnati were most pro nounced in the Manufacturing sector followed by Trade/Trans portation/Utilities. Due to job losses stemming from the pan demic, Cincinnati’s current employment base now sits at about 1% below the pre-pandemic level in February 2020. Cincinnati, like many other Rust Belt markets, has long had a concentration in higher-paying manufacturing jobs and has been working to reinvent its economy as a high-skill, high-value manufacturing center. Further, Cincinnati is home to corporate headquarters for seven Fortune 500 companies.
• Cincinnati characteristically managed to escape the more extreme swings in apartment market performance seen over the last two years in the wake of the pandemic. Although apartment absorption cooled considerably in 3rd quarter 2022, Cincinnati apartment demand did not plumet to the degree seen in many other markets nationwide.
• As deliveries mount to a record rate over the next year, operators will be unlikely to sustain Cincinnati’s recent record high rent growth. There were 6,411 units under construction at the end of 3rd quarter, with 3,722
DEMOGRAPHICS: STATISTICS
Population: 2.2M
Average occupancy: 96.9%
DEMOGRAPHIC OVERVIEW the rent
of those units slated to come online within the next 12 months. Although those deliveries will be spread more evenly throughout the Cincinnati market, new supply will test the depth of the Class A renter pool in a market that has still yet to recover all its pandemic-era job losses.
• During the year-ending 3rd Quarter 2022, median home prices in Cincinnati increased an average of 10.6%, landing at a median price of roughly $270,000.
• The local homeownership rate averaged 70.6% in the year-ending 2nd
• In 3rd quarter 2022, effective asking rents for new leases were up 11.8% yearover-year. That annual rent performance was above the market’s five-year average of 4.7%. Cincinnati’s recent annual rent change performance ranked #2 in the Midwest region.
Median age: 37.9
Rent growth: 11.8%
MSA median home value: $270,000
MSA median hhi: $66,900
• Product classes in Cincinnati, annual effective rent change registered at 14.8% in Class A units, 11.6% in Class B units and 8.1% in Class C units.
1 - Year growth: 10.6%
1 - Year growth: 2.35%
• Among submarkets, the strongest annual rent change performances over the past year were in Butler County and North Central Cincinnati.
• The weakest performances were in West Cincinnati and North Cincinnati. As of 3rd quarter 2022, effective asking rental rates in Cincinnati averaged S1,286 per month, or $1.372 per square foot.
SUPPLY & DEMAND
• New apartment completions in Cincinnati were modest recently, as 2,130 units delivered in the year-ending 3rd quarter 2022. With 176 units removed from existing stock over the past year, the local inventory base grew 1.2%.
• In the past year, supply was greatest in Central Cincinnati and Campbell/Kenton Counties. New supply was concentrated in Central Cincinnati, Campbell/Kenton Counties and Northeast Cincinnati/Warren County, which received 65% of the market’s total completions.
• At the end of 3rd quarter 2022, there were 6,411 units under construction with 3,722 of those units scheduled to complete in the next four quarters.
• Scheduled deliveries in the coming year are expected to be concentrated in North Central Cincinnati and Central Cincinnati.
• Over the past five years, annual absorption in Cincinnati has ranged from 675 units to 4,536 units, averaging 2,286 units annually during that time.
• In the year-ending 3rd quarter 2022, the market recorded demand for 1,013 units, trailing concurrent supply volumes. Among submarkets, the strongest absorption over the past five years was seen in Central Cincinnati, Campbell/Kenton Counties and Northeast Cincinnati/Warren County.
• Those areas accounted for 56% of the market’s total demand over the past five years. In the past year, demand was greatest in Central Cincinnati and Campbell/Kenton Counties.
CAPITAL MARKETS
• Transaction dollar volumes in Cincinnati totaled roughly $332.9 million in the year-ending 3rd quarter 2022, down about 40% year-over-year.
• Transactions in the year-ending 3rd quarter 2022 yielded an average cap rate of 5.50%, down 21 basis points year-over-year. By comparison, cap rates averaged 5.05% in the Midwest region and 4.56% nationally.
• The average price per unit in Cincinnati came in at roughly $151,800, up 57.4% annually. Cincinnati’s average price per unit landed below the norms for both the Midwest region ($173,900) and U.S. overall ($238,700).
ATTRACTIONS
HEART OF DOWNTOWN
Right on the water and brimming with activity- The Banks is where you will find everything from sports events to a lively nightlife scene. Located along the Ohio River, The Banks provides spectacular riverfront views and lines the water with a family friendly park. Along with great biking, walking, and other recreational amenities during the daytime, The Banks comes alive at night. With live music and entertainment, a thriving bar scene nestled between two sports stadiums, The Banks is the place to be.
A major attraction at The Banks, the Andrew J Brady ICON Music Center was built for the audience experience, offering an intimate yet spacious setting. Offering both indoor and outdoor venues, the state-of-the-art facility hosts a wide variety of musical acts, spanning all genres. Visitors can enjoy a live concert while taking in the scenic riverfront view.
Ranked by USA Today readers as a Top 5 Riverwalk in the nation, Smale Riverfront Park offers walking trails, water features, swings, and other amenities to enjoy, while taking in the beautiful views of the Ohio River and the historic John A. Roebling Suspension Bridge. If you have kids in tow, make sure to visit Carol Ann’s Carousel, featuring 44 characters and illustrations incorporating Cincinnati landmarks. Enclosed in a glass building, the carousel is open year-round.
TQL STADIUM
The FCC-TQL partnership brings together two Cincinnati-grown, leading businesses that share a “no limits” philosophy as well as a deep connection and commitment to our local community. There are a lot of synergies that make this alliance between TQL and FCC a perfect match and are reflected throughout the stadium from — the fin lighting to the TQL Beer District. The stadium features first-in-the-world lighting technology powered by 2.7 miles of LED lights.
ATTRACTIONS CINCINNATI ZOO
The Cincinnati Zoo & Botanical Garden is the second oldest zoo in the United States, founded in 1873 and officially opening in 1875, after the Roger Williams Park Zoo. It is located in the Avondale neighborhood of Cincinnati, Ohio. It originally began with 64.5 acres in the middle of the city, but has spread into the neighboring blocks and several reserves in Cincinnati’s outer suburbs. It was appointed as a National Historic Landmark in 1987.
From 11am – 1am daily, the 85-acre DORA district at The Banks allows guests to take their beverage purchased from one of the 18 Banks establishments and explore our public plazas and green spaces. It simply needs to be in the Official DORA Cup.
At risk of missing the first pitch? Late for the opening act? Take your beverage purchased in a DORA cup from a Banks establishment and go! Waiting for a table, or wish to picnic outside in The Banks plazas or greenspaces? Grab a DORA beverage from a Banks establishment and explore!
DORA
HARD ROCK CASINO
The game is always on at Hard Rock Casinos, where stars are made every night. Come try your hand at the tables, with classic games including blackjack, baccarat and poker, or tap into thousands of the hottest slots on the planet. With the world’s greatest rock memorabilia collection to enhance the thrill, plus the accompaniment of live, world-class entertainment, the atmosphere is like no other.
CINCINNATI ART MUSEUM
Located in scenic Eden Park, the Cincinnati Art Museum features a diverse, encyclopedic art collection of more than 67,000 works spanning 6,000 years. In addition to displaying its own broad collection, the museum also hosts several national and international traveling exhibitions each year. Visitors can enjoy the exhibitions or participate in the museum’s wide range of art-related programs, activities and special events. General admission is always free
for all. Museum members receive additional benefits. The museum is supported by the generosity of individuals and businesses that give annually to ArtsWave. The Ohio Arts Council helped fund the museum with state tax dollars to encourage economic growth, educational excellence and cultural enrichment for all Ohioans. The museum gratefully acknowledges operating support from the City of Cincinnati, as well as our museum members.
RETAIL & SHOPPING
In addition to the restaurant and nightlight scene, the area has no shortage of retail options. Downtown offers both boutiques and department stores. Over-the-Rhine (OTR) is a historic, walkable district of downtown Cincinnati with many independent shops. Cincinnati’s Over-the-Rhine neighborhood was once a place where residents would not recommend to visitors, but that has changed. The restaurant and nightlife scene is now thriving, and the shopping scene is beginning to catch up. Most of the shops are in the southwest quarter of Over-the-Rhine, on either Vine or Main St. You won’t find chain stores in this walkable shopping district. MiCA 12/v and Urban Eden are a popular gift shops that sell local arts and crafts. Elm & Iron sells vintage and up-cycled items for the home. The Little Mahatma sells exotic jewelry and folk art from around the world. You’ll find several clothing boutiques, including Mannequin, a non-profit upscale and vintage boutique that benefits local charities. Park + Vine is a popular general store for environmentally-conscious shoppers; they sell a variety of merchandise including green cleaning and personal products, vegan foods, garden products and more.
FINDLAY MARKET
Findlay Market is Ohio’s oldest continuously operated public market and is located in the historic Over-the-Rhine neighborhood. The market is a wonderful place for locals to buy their groceries as well as a must-see historic spot for visitors to Cincinnati. Findlay Market is open year-round, Tuesday through Sunday, with a seasonal farmers market. Nearly 40 full-time businesses operate year-round, plus over 100 more vendors operate on weekends or part-time. Many vendors sell raw food while others specialize in prepared foods. Some of the merchants are new startups, while others have been in business for generations. You’ll find everything from fresh meat and produce to imported fine teas to Belgian waffles. There are restaurants as well as a beer garden, so plan to stay for lunch. Findlay Market has a fascinating history. Why not take a tour to learn more? There are several different tour options, including a culinary tour with tasty samples.
Our commitment is to help our clients create and preserve wealth by providing them with the best real estate investment sales, financing, research and advisory services available www.adgmultifamily.com
