Trends & Insights
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Trends & Insights
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At Northmarq, we are committed to offering our clients the latest trends and expert analysis to power their decision making. Our MarketSnapshot suite of reports contains critical market data covering a variety of commercial real estate property sectors. In each report, you will find: Investment sales volume data Average cap rate information Buyer distribution analysis... and more! Single-Tenant Overall Market Single-Tenant Office Single-Tenant Industrial Single- Tenant Retail Multi-Tenant Retail
Manufactured Housing 4Q23 Market Overview: Rents maintain a steep upward trajectory
Highlights:The manufactured housing sector continued to post strong operational performance in recent months, as occupancy and rents trended higher during the fourth quarter. Shipments of new units were consistent throughout 2023, totaling 83,000 units for the full year.Occupancy inched higher by 10 basis points during the fourth quarter to 94.7%. The national occupancy rate increased by 30 basis points in 2023.Rent growth continued in recent months after elevated gains in the preceding two quarters. Rents advanced 1.5% in the final three months of the year, closing 2023 at $679 per month. During the past year, rents increased by 7.3%.While sales activity picked up during the second half of the year, annual transaction volume in 2023 lagged levels recorded in 2022 by 40%. The median price in 2023 was $41,000 per space, down 29% from one year ago.Read the report, or visit our Manufactured Housing page to learn more.
February 12, 2024
Phoenix 4Q23 Multifamily Market Insights Report: Deliveries picking up, likely to accelerate in 2024
Highlights: An active pace of new apartment construction dragged on property performance in 2023, despite healthy renter demand for units. With the development pipeline totaling more than 42,700 units under construction, supplyside pressures will persist through 2024.Vacancy pushed higher throughout much of 2023; during the fourth quarter, the rate rose 40 basis points to 7.4%. For the full year, vacancy rose 100 basis points.After mostly holding steady in the first half, rents retreated in the final six months of 2023. Rents ended the year at $1,575 per month, down 2.5% from one year earlier.The investment market picked up slightly during the fourth quarter, but transaction volumes were down 68% from 2022 to 2023. Prices ticked lower to $270,300 per unit, while cap rates averaged 5.25%.Read the report, or engage with our Phoenix office to learn more.
February 7, 2024
Tucson 4Q23 Multifamily Market Insights Report: Investment activity limited to Class C properties
Highlights:Multifamily property performance in the Tucson market softened during the fourth quarter, as vacancy rose and rents decreased. Developers delivered a cyclical high of completions in 2023, with 2,000 units coming online.The vacancy rate rose 30 basis points in the final three months of 2023 to 8.2%. Year over year, vacancy is up 80 basis points.Average rents posted gains in the first nine months of the year before inching lower in the fourth quarter. Despite the recent decline, rents in Tucson advanced 2.6% in 2023, finishing the year at $1,187 per month.Transaction activity remained limited in the fourth quarter, tracking trends that prevailed throughout much of the year. The total sales transactions were down 77% from the previous year. The median price was $125,400 per unit in 2023.Read the report, or engage with our Phoenix office to learn more.
February 7, 2024
Denver 4Q23 Multifamily Market Insights Report: Class A assets leading the way in the investment market
Highlights:After holding steady for much of the year, operating conditions in the Denver multifamily market softened during the fourth quarter. The vacancy rate rose, and rents declined in the final three months of the year. New projects continued to come online; annual completions totaled roughly 13,500 units.The vacancy rate trended higher in recent months after remaining relatively stable during the first nine months of the year. Vacancy rose 40 basis points during the fourth quarter to 5.8%. The local vacancy rate rose just 20 basis points for the full year.Rents dipped in the closing months of 2023 after posting healthy growth in the first three quarters of the year. Apartment rents declined by 1.8% during the fourth quarter to $1,894 per month. Even after a drop at the end of the year, area rents increased by 1.6% in 2023.Transaction volume picked up during the second half of the year, but annual sales in 2023 still lagged levels recorded in 2022 by 47%. The median price in 2023 was $318,600 per unit, up 6% from the previous year.Read the report, or engage with our Denver office to learn more.
January 29, 2024
Single-Family Build-to-Rent Special Report: Strategies evolve with rates elevated and supply growth accelerating
While current conditions present greater challenges compared to earlier periods — particularly on the supply side — we see investors and developers continuing to act as strategies evolve with rates elevated and supply growth accelerating.Deliveries of new units increased in 2023, and new construction outpaced absorption, resulting in higher vacancy rates and rents that were essentially flat. These pressures should begin to ease by the end of 2024, with construction starts slowing. The debt and equity environment has evolved, and investment markets have cooled, but transactions are still getting done — albeit at lower volumes than in recent years.Report highlights:After years of rapid growth, the single-family build-to-rent (SF BTR) market is facing its first period of uncertainty. New development surged in 2023, but demand was also elevated; absorption spiked 35% from 2022 levels but has not kept pace with deliveries.The pace of economic growth as measured by GDP has topped expectations throughout the year, including a sharp spike higher in the third quarter. Inflation was a drag on the economy throughout much of 2022 and early 2023, but the rate has come down to manageable levels in the second half, reducing a threat to the overall economy. Labor markets remain strong, with an unemployment rate under 4% and 2.7 million net new jobs created in 2023.Despite dropping by about 100 basis points since an October peak, residential mortgage rates are elevated and restricting home buying activity. The average rent on a SF BTR unit is $828/month lower than the average monthly mortgage payment on a median-priced single-family home.Construction trends are mixed, with deliveries up approximately 20% from 2022 levels, while starts are 11% lower than the pace established one year earlier. Construction is concentrated in the fast-growing South region, with Texas, Florida and the Carolinas top spots for new development.Vacancy rates have trended higher in 2023, as new supply growth has outpaced absorption by approximately 25%. Phoenix, Dallas-Fort Worth and Atlanta have led the way for absorption, while Charlotte and San Antonio are among the top markets for rent growth.Agencies remain the primary sources for acquisition financing, with underwriting similar to new Class A apartments. Equity investors are exercising greater caution in the current environment and aware of the competitive impact of new supply. Terms for construction financing became increasingly conservative in 2023, and lenders have become more selective on the loans they quote.Read the full report, or explore our Build-to-Rent page to learn more.
January 9, 2024
Northmarq Arranges the Sale Leaseback of Kentucky Cold Storage and Meat Processing Facility for $5.0 Million
Northmarq’s Josh Dicker, senior investment sales analyst with sale leaseback expertise, and Isaiah Harf, managing director, arranged the sale leaseback of a 28,000-square-foot, cold storage and meat processing facility located at 117 Masonic Drive in Princeton, Kentucky. Dicker and Harf represented the seller, Porter Road Butcher, which executed a long-term triple net lease at the time of sale. The buyer, a California-based private investor, acquired the asset for $5.0 million. “The sale leaseback transaction was not only an investment in Porter Road’s unique real estate, but also an investment in their business and what they are trying to accomplish as an innovator in the direct-to-consumer butcher business,” said Dicker, a sale leaseback expert. “The deal represented a win for not only buyer and seller, but the local Princeton community in which Porter Road operates.” Founded by two former chefs, Porter Road is a growing direct-to-consumer butcher service that sources their meat from local farms in Kentucky and Tennessee. The property was completely retrofitted in 2021 and converted to the state-of-the-art freezer/cooler and meat processing facility. Situated near multiple major highways, the facility is conveniently located an hour and 30 minutes from downtown Nashville and close to the company’s meat suppliers.
January 9, 2024
Manufactured Housing 3Q23 Overview: With demand elevated, occupancies and rents push higher
Highlights:Manufactured housing communities posted strong operational performance during the third quarter. Shipments of new units have slowed to this point in 2023, but demand for units is elevated and rents are on the rise.Occupancy rose 20 basis points during the third quarter, reaching 94.6%. The rate has risen 30 basis points year over year, with strong gains in the Midwest and the Southwest.Rents maintained an upward trajectory in the third quarter, rising 2.5% in just the last three months. Year over year, average rents are up 7%, reaching $669 per month.Sales velocity accelerated in the third quarter, but transaction levels remain about 40% behind the 2022 pace. Prices have dipped. The median price to this point in 2023 is $42,300 per space, while cap rates averaged 6.5%.Read the report, or visit our Manufactured Housing page to learn more.
December 28, 2023
San Antonio 3Q23 Multifamily Market Insights Report: Class A sales provide a spark in the third quarter
Highlights:Operating conditions in the San Antonio multifamily market softened during the third quarter, as asking rents inched lower while the vacancy rate trended higher. Developers are active, with roughly 5,900 units completed year to date and another 15,505 units under construction.The vacancy rate rose in recent months after improving slightly in the preceding quarter. Area vacancy trended higher by 60 basis points during the third quarter to 6.5%. Year over year, the rate has climbed by 150 basis points.Asking rents inched lower to $1,150 per month, but rents are slightly higher than one year ago. Asking rents have advanced 1.4% during the past 12 months after double-digit gains throughout much of 2021 and 2022.Multifamily sales activity picked up in recent months although year-to-date sales velocity is down from 2022 levels. In sales where pricing was available, the median price to this point in the year is $114,000 per unit, essentially unchanged from last year.Read the report, or engage with our San Antonio office to learn more.
December 28, 2023