Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Wednesday, 31 January 2018

Ten-X Sees Supply Glut Impacting Apartment Fundamentals This Year

Ten-X Commercial projects that the national vacancy rate for apartment properties will increase to 5 percent, up from 4.7 percent last year. Meanwhile, it expects rents to increase by 3 percent, which compares with last year's 3.4 percent growth rate. Driving the slowdown: an increase in the supply of units.

Commercial Real Estate Direct Staff Report

The national apartment vacancy rate likely will increase slightly this year, while rent growth slows, according to Ten-X Commercial.

The Irvine, Calif., online property-sales platform projects that the national vacancy rate will increase to 5 percent, up from 4.7 percent last year. Meanwhile, it expects rents to increase by 3 percent, which compares with last year's 3.4 percent growth rate. Driving the slowdown: an increase in the supply of units.

The company forecasts that 255,000 units will be added to the market this year. And while that's a slight decrease from the 260,000 units that were delivered last year, it overshoots expectations for net absorption by 55,000 units.

"We're starting to see the multifamily cycle turn right now, but not in a particularly severe way," said Matt Schreck, a quantitative strategist at Ten-X. "The sector hit its peak already. It doesn't mean the conditions are bad, but they've already peaked."

For investors looking to buy apartment properties, Ten-X has identified Sacramento, Calif.; Raleigh, N.C.; Riverside-San Bernardino, Calif.; Jacksonville, Fla., and Fort Worth, Texas, as the top...





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Data Digest

 

CMBS DELINQUENCY VOLUME

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CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

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CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

REITCafe

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  • What Does Increased Construction Mean for Apartment REITs?
    REITs so far this year have raised $17.1 billion of capital through the sale of unsecured notes, bringing the total raised over the past two and a half years to just more than $75 billion. That’s more than they raised during the previous five years. The massive volume shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark...
shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark against which most REIT’s price their bonds
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