multi-family report | randy bates

www.CharlestonCommercialMarketForecast.com

MULTI-FAMILY REPORT


Charleston Multifamily Report

RANDY BATES

RANDOLPH DEVELOPMENT


Target Market - Demographic Trends

• Millennials – 20 – 34 years old o Largest Demographic Group in American Historyo 85 Million to 95 Million Peopleo Staggering Student Debto Diminished Job Opportunitieso Delayed Marriageo Desire Flexibility & Job Mobilityo Opting Out of Home Ownership


Target Market - Demographic Trends

• Empty Nesters – 50 – 69 years oldo Active Baby Boomerso Less need for spaceo Desire Less Home Maintenanceo Selling Homes - Greater Equityo More Disposable Incomeo Returning to Cities


Increasing Supply


Increasing Supply

2012 2013 2014 20150

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

1,423 1,6022,011 2,175

3,132

3,7794,144

4,8424,555

5,381

6,155

7,017

Charleston Residential Permits

Multifamily Single Family Total Permits


Increasing Demand


Increasing Demand

2012 2013 2014 2015F0

500

1,000

1,500

2,000

2,500

3,000

1,1241,278

1,440

2,575

703

1,8341,705

2,251

Multifamily Deliveries and Absorption

New Units Delivered Units Absorbed Linear (Units Absorbed)


Higher Rents

Hanahan/North Charleston Berkeley County Airport/North Charleston Central Charleston Mount Pleasant0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

6.40%6.80%

5.60% 5.70%6.10%

4.00%

3.30%3.00% 3.20%

3.80%

Rent Growth

2015 Forecast 2016 - 2019


Higher Rents


Charleston Multifamily ReportSo What Do We Make Of All This???

http://mamconf.naahq.org/



FORECAST• 4,500 Units Under Construction and 6,300 Units Proposed• Continued Job Growth Increases Demand• 1 New Apartment for Every 3.5 New Jobs• Urban Demand Greatest• Supply Will Outpace Demand in the Short Run: 6% - 8% Vacancy• Rent Will Continue to Increase at a More Moderate Rate: 3% - 4%• The Urban Institute Predicts 59 % of New Household Formation Over the

Next 15 years Will Be Renters

PROBLEMS• Affordability, Affordability, Affordability

o Activist Groups Constrict Land Supply Through Pressureo Entitlement Risk – Zoning, Design Review, o Higher Municipal Feeso Building Codes – Stricter & More Expensiveo Local Conditions - Wind, Seismic, Soil & Floodo Local Construction Labor Shortage



RANDY BATES

RANDOLPH DEVELOPMENT

[email protected] | 843.849.0739

multi-family report | randy bates

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