PROPERTY MANAGEMENT sented a big improvement over the negative absorption of 14,000 units in the fourth quarter of 2022, according to CBRE. The brokerage giant’s prediction that absorption would turn positive in the second quarter of this year came to frui-tion as 70,200 units were leased. That represented the most signifi -cant quarterly demand since early 2022, CBRE reports. “Multifamily is well-positioned in the current environment to continue to pro-vide solid returns for investors,” declares Avery Solomon, a senior managing director with Cushman & Wakefield, which manages more than 178,000 units nationwide. “With the rise of home prices as well as interest rates nationally, we see opportunity in all multifamily asset classes in the major metros.” Bonaventure, an owner and op-erator of 6,000 units in 32 apart-ment communities primarily in the Mid-Atlantic and Southeast, continues to see strong property fundamentals and income growth in its markets despite an uptick in new construction, says Dwight Dunton, founder and CEO of the firm. Bonaventure also has built its portfolio with fixed-rate debt, he adds, which is giving it an edge over competitors who tapped floating-rate loans. “The stability of our financing This dog is looking for bed bugs. We know, because we insure him. When you need insurance, it’s crucial to work with a carrier that really understands your industry. HAI Group has catered solely to the multifamily AVERY SOLOMON Cushman & Wakefield But a slowing economy and an abundance of development still threaten to undercut occupancy. More than 1 million apartment units are under construction in the United States, pointed out Greg Willett, a multifamily spe-cialist with Institutional Property Advisors, during an event hosted by NMHC in April. Develop-ers are expected to deliver about 400,000 units this year, an amount that’s likely to exceed demand, he added. In some markets, such as Phoenix, Denver and Atlanta, the combination of slowing house-hold formation and new supply is weighing on rent growth, states Mitchell. Whether that’s a short-term trend exclusive to specific markets or a more fundamental shift that will spread to other cities remains to be seen. “It’s market to market,” he adds. “We’re beginning to see some clas-sic concessions again in some mar-kets — free rent in the one-to-two-month range. ” www.MultifamilyAffordableHousing.com affordable housing industry for more than 35 years, so we’re not surprised when we’re asked to insure things like a dog that can sniff out bed bugs. Want to work with a carrier that really gets you? Call us today at 800-873-0242 or visit us online at haigroup.com HAI Group® is a trademark for the property and casualty insurance operations of Housing Authority Risk Retention Group, Inc. All products and services are written or provided by subsidiaries or affiliates of Housing Authority Risk Retention Group, Inc. Products or services may not be available in all jurisdictions. Certain property and casualty coverage may be provided by a risk retention group or a surplus lines insurer or by a third party. Risk retention groups and surplus lines insurers do not participate in state guaranty funds and their insureds are not protected by such funds. For a complete list of HAI Group companies, visit www.haigroup.com. July/August 2023 | Southeast Multifamily & Affordable Housing Business | 19
Southeast Multifamily & Affordable Housing Business July/August 2023: Page 19
