The Apartment Report

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The Apartment Report TRANSWESTERN Q3.2012 Houston The Apartment Report Q3.2012 RENTS OCCUPANCY ABSORPTION SALES DEVELOPMENT SNAPSHOT Average effective rental Q3 occupancy rose to A total of 3,195 units 46 properties (12,328 26 communities (5,725 rates have increased 89.6% from 89.4% in Q2 absorbed in Q3, resulting units) sold in the third units) have opened in 5.1% over the past three 2012. The market has in YTD 2012 absorption of quarter. The largest the past 12 months, with months and 5.9% over the posted an annualized 15,921 units (23% above percentage of the 47 (12,049 units) under past twelve months (on an 3.0% increase in the 12,966 units absorbed properties sold (73% of construction and 60 new annualized basis). occupancy in the past during the same period the total) were 1980s built projects (18,731 units). twelve months. last year . or older. RENTAL RATES • 3Q 2012 marked the 11th consecutive period of effective rental rate increases since 4Q 2009. • Average effective rents ended the quarter at $788 per unit ($0.905 per square foot) compared to $779 per unit ($0.894 per square foot) in the previous quarter. • Rental rates, on an annualized basis, have increased 5.1% over the past three months, 6.7% over the past six months and 5.9% over the past twelve months. ED CUMMINS • The submarkets registering the highest annualized rental rate growth, during Q3, are Medical Center/Bellaire Senior Vice President (14.9%), Far East (12.5%), Katy/Far West (10.7%), West Memorial/Briar Forest (9.2%) and Tomball/Far Northwest 713.272.1288 | direct (9.1%). [email protected] • Concessions were reported in 45% of the market with the average special offered at 6.0%. CLINT DUNCAN Vice President EFFECTIVE RENTS / UNIT - QUARTERLY 713.270.3316 | direct Rental rates shown are effective: net of concessions and electric utility adjustments [email protected] $800 $788 $779 LUPE OLIVARES $780 Senior Analyst $762 $760 713.272.1290 | direct $749 $751 [email protected] $743 $740 $736 $723 $724 SUNJAY ARYA $720 $716 Transaction Manager 713.272.1276 | direct $700 [email protected] $680 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 We hope you find this report both useful and insightful. Please feel EFFECTIVE RENTS / SF - QUARTERLY free to contact us if we can assist $0.920 with your property valuation, rent $0.905 or sales comparables analysis or $0.900 $0.894 any current market trends and $0.876 information. $0.880 $0.861 $0.863 $0.860 $0.854 We look forward to working with $0.846 you in the near future. $0.840 $0.832 $0.833 $0.824 $0.820 TRANSWESTERN $0.800 HOUSTON MULTIFAMILY GROUP $0.780 1900 West Loop South, Suite 1300 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 Houston, Texas 77027 713.270.7700 | telephone 713.271.8172 | facsimile transwestern.net The Apartment Report Q3.2012 Houston OCCUPANCY • Houston’s multifamily market averaged occupancy of 89.6% in 2012’s third quarter, compared to 87.5% in the same period last year. • During the past three months, the largest occupancy increases occurred in the following submarkets (figures shown are on an annualized basis): 1) Baytown (13.2%) 3) Gulfton/ Bissonnet (10.3%) 2) Richmond/ Rosenberg (10.5%) 4) Tomball (10.2%) • Class “A” and “B” properties posted the highest occupancies, both groups averaging 92.9%, followed by class “C” properties averaging 86.6%. • The top occupied submarkets during Q3 were Montrose/ Museum District (95.3%), Katy/ Far West (95.3%), Fort Bend (95.3%), Tomball/ Far Northwest (95.1%) and FM 1960 West/ Steeplechase (94.9%). APARTMENT OCCUPANCY - QUARTERLY 90.0% 89.4% 89.6% 89.0% 88.5% 88.0% 87.5% 87.5% 87.0% 87.0% 86.5% 86.1% 85.9% 86.0% 85.5% 85.0% 84.0% 83.0% 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 ABSORPTION • 2011 posted a combined 13,605 units of absorption. Q3 2012 results posted an impressive 3,195 units, bringing the 2012 YTD total to 15,921 units. • The submarkets posting the highest absorption levels were: 1) Medical Center/ Bellaire (551) 3) Katy/ Far West (288) 2) Gulfton/ Bissonnet (396) 4) Woodlands/ Far North (288) • Strong apartment demand fueled positive absorption in a majority (29) of Houston’s 41 submarkets. • The 15,921 units absorbed YTD in 2012 are an increase of 23% over the same period in 2011 when absorption reached 12,966 units. APARTMENT ABSORPTION - QUARTERLY 7,000 6,427 6,439 6,287 6,000 5,227 5,000 4,351 4,000 3,609 3,388 3,195 3,000 2,000 1,000 639 0 (1,000) (476) 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 THE APARTMENT REPORT • HOUSTON • Q3.2012 2 The Apartment Report Q3.2012 Houston APARTMENT SALES • Third quarter sales continued the positive trend exhibited during the first half of 2012 with a total of 46 properties (12,328 units) trading. Property Submarket Units Built Sale Date Canfield Lakes FM 1960 West/Champions 442 1983 Sep-12 Pebble Creek FM 1960 West/Steeplechase 136 1982 Sep-12 Greystar Cypress Village FM 1960 West/Steeplechase 273 2008 Sep-12 Fannin Street Station (fka Archstone Medical Center) Medical Center/Bellaire 678 1995/1998 Sep-12 Amherst at Cityview Greenspoint 310 1979 Sep-12 Augusta at Cityview Greenspoint 268 1985 Sep-12 Biscayne at Cityview Greenspoint 560 1977 Sep-12 Breckenridge at Cityview Greenspoint 509 1978 Sep-12 Cityview West Greenspoint 286 1978 Sep-12 Crescent at Cityview Greenspoint 282 1981 Sep-12 Durham at Cityview Greenspoint 179 1984 Sep-12 Salado at Cityview Greenspoint 318 1979 Sep-12 Beacon Hill Braeswood/Fondren SW 121 1983 Sep-12 Capital Estates Clear Lake 181 1965/1967 Sep-12 Harbortree Clear Lake 151 1973 Sep-12 Blue Stone (fka Brookstone) Alief 224 1982 Sep-12 Gardens at Challenger Park Clear Lake 354 2009 Aug-12 Windwater at Windmill Lakes Gulfgate/Almeda Mall 150 1999 Aug-12 Chestnut Hill Sharpstown/Westwood 458 1982 Aug-12 Carrington Park Katy/Far West 390 2004 Aug-12 Broadstone Memorial West Memorial/ Briar Forest 401 2007 Aug-12 Ridgestone (fka Villa Cordoba) Braeswood/Fondren SW 104 1970 Aug-12 Delta One Brookhollow 68 1965 Aug-12 La Tour Fontaine Galleria 162 1994 Aug-12 Timberstone FM 1960 West/Champions 240 1999 Aug-12 Silver Leaf Sharpstown/Westwood 224 1977 Aug-12 Bissonnet In The Village Inner Loop West/Greenway Plaza 196 1973 Aug-12 Maryland Manor Montrose/Museum District 67 1984 Aug-12 Hunters Chase Spring Branch 328 1969 Aug-12 Ashford Pointe Alief 224 1983 Aug-12 The Lakes Gulfgate/Almeda Mall 162 1983 Aug-12 Bellaire Gardens Gulfton/Bissonnet 206 1965 Aug-12 Burnham Woods Brookhollow 120 1965 Jul-12 The Mansions of Shadowbriar West Memorial/ Briar Forest 259 1983 Jul-12 Vanderbilt Alief 106 1985 Jul-12 Creekside Baytown 250 1978 Jul-12 Reserve at Autumn Creek Friendswood/Pearland 212 2001 Jul-12 Forest Pointe FM 1960 West/Champions 270 1983 Jul-12 Marquis at Katy Katy/Far West 258 2009 Jul-12 Sterling Point Gulfton/Bissonnet 921 1978 Jul-12 Willowridge Braeswood/Fondren SW 262 1979 Jul-12 Glenwood Sharpstown/Westwood 60 1981 Jul-12 Palms at Cypress Station FM 1960 West/Champions 336 1978 Jul-12 Stonehaven Galleria 338 1967 Jul-12 Bay Park Clear Lake 124 1980 Jul-12 Parc Towne Plaza Northshore/Wood Forest 160 1969 Jul-12 THE APARTMENT REPORT • HOUSTON • Q3.2012 3 The Apartment Report Q3.2012 Houston CONSTRUCTION • 5,725 units, in 26 communities, have been delivered to the market in the past twelve months, of which 81% are conventional, 12% are senior housing developments and 7% are affordable. • 12,049 units (47 communities) are currently under construction, 97% of these units are conventional, the remainder - 2% are affordable and 1% are senior housing. • Proposed construction is currently at 18,731 units (60 communities) of which 50% is concentrated in the following four submarkets: 1) Katy/ Far West (2,949 suburban units) 3) West Memorial/ Briar Forest (1,980 suburban units) 2) Montrose/ Museum District (2,680 infill units) 4) Woodlands/ Far North (1,815 suburban units) Now Leasing Submarket Property Units Type Submarket Property Units Type Hwy 288/ South Residences Pearland Town Center II 172 Conventional West Memorial/ Briar Forest Domain at Eldridge 320 Conventional Braeswood/ Fondren SW Floral Gardens 100 Senior Housing Heights 2411 Washington 222 Conventional Katy/ Far West Park at Cinco Terrace 316 Conventional Hwy 288/ South Cypress Creek Fayridge 148 Affordable Pasadena/ Deer Park Providence at Town Square 188 Affordable Far East Liberty Hills 228 Conventional Woodlands/ Far North Woodlands Lodge 300 Conventional Katy/ Far West Grand Villas II 108 Conventional Lake Houston/ Kingwood Carrington at Park Lakes 252 Conventional Inner Loop West/ Greenway Plaza Gables Post Oak 316 Conventional FM 1960 West/ Champions Waterstone 276 Conventional Medical Center/ Bellaire Archstone Toscano West University 474 Conventional Woodlands/ Far North Retreat at the Woodlands 240 Conventional Inwood/ Northwest Parkway Ranch II 44 Affordable Woodlands/ Far North Mansions Woodland 405 Conventional Clear Lake Tarrington Court 153 Senior Housing Katy/ Far West Mason Senior 120 Senior Housing Northshore/ Wood Forest Cypress Gardens 100 Senior Housing Westchase Camden Royal Oaks II 104 Senior Housing Hwy 288/ South Magnolia Place 144 Senior Housing Medical Center/ Bellaire Connection at Buffalo Pointe 352 Conventional Conroe/ Montgomery The Retreat 210 Conventional Richmond/ Rosenberg Dolce Living Rosenberg 156 Conventional FM 1960 West/ Champions San Antigua I 277 Conventional 5,725 Currently Under Construction Submarket Property Units Type Submarket Property Units Type Montrose/ Museum District Post Midtown III 124 Conventional Galleria Sage at Westheimer 300 Conventional Montrose/ Museum District Camden City Centre II 263 Conventional Galleria Avenue R 392 Conventional Montrose/ Museum District Broadstone W Dallas 246 Conventional Galleria Broadstone Lakes at Post Oak 272 Conventional Montrose/ Museum District Hanover West Gray 278 Conventional Galleria Waterwall Place 322 Conventional Montrose/ Museum District Post Richmond 242 Conventional Galleria 2001 S.
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