Kansas City Multifamily Market Report – June 2012
Well folks, the Kansas City multifamily market is picking up steam! It’s seeing the highest rent growth in over 10 years, according to a new report released this week by the brokerage firm, CBRE. Occupancy, average rent, average rent per square foot, and absorption are all up. Concessions are down below pre-recession 2007 levels. Also, new multifamily apartment units coming on to the market (only 380 units this year) are at historical lows of only 29% of the yearly average. All of this points to a very strong Kansas City multifamily market for the rest of this year and the foreseeable future. Great news for local multifamily property owners.
According to the CBRE report, all ages of multifamily properties have had rental rate and occupancy growth. However, newer properties have been leading the way. Those built since 1980 have had the highest occupancies and rental rate growth. Properties built since 2000 reported rent growth of an amazing 6.1% compared to a little over half that for all other properties.
The top multifamily submarkets for occupancy in Kansas City were Olathe, Overland Park, and Shawnee/Lenexa/Mission on the Kansas side, followed closely by Platte County on the Missouri side. South Overland Park and Central Kansas City have the highest average rent per unit. Central Kansas City also has the highest average rent per square foot at over $1.
Our local multifamily properties have proven the strong multifamily market. All have done well, but one of our properties has actually had rental rate increases of over 10% this year. In this same property, occupancy has been nearly 100% all year with zero concessions. Looks like it’s time to raise the rent again. If you’ve been sitting on the sidelines waiting for the right time to invest, it’s now!
There have been very few multifamily sales in Kansas City so far this year, as owners have elected to hold their properties closely.
You can read the full CBRE Kansas City multifamily family market report by visiting CBRE’s website or by clicking here.