Fourth Quarter Market Review

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Multifamily Housing Update from RED Capital Group

CAA Member, RED Capital Group has just completed the 2009 Q4 Market Overview for Columbus. The complete report is available to CAA members.

Key Points:

After posting steadily improving payroll trends since July, the Columbus labor market stumbled in December. Accelerating job cuts and business closings in the transportation, retail and hospitality service sectors were largely responsible.
RED Research and PNC Economics expect payrolls to be nearly flat this year. December's weak print and the prospects for a downward revision of recent payroll trends by the BLS cloud the picture considerably.
Class-B/C properties were devestated by the loss of 1,023 leased tenants in 4Q09, causing class occupancy to plummet 130 basis points to 89.3%. Class-A projects benefited, filling a net of 323 units, the best quarter in more than two years. Class-A occupancy advanced by an average of 30 bps to 93.5%.
Average face rents fell, dropping $1 (-0.1%) sequentially. Owners managed to trim concessions by $4, giving rise to a $3 (0.5%)
advance in average effective rents to $634.
Employing an 8.5% going-in cap rate assumption, RCR estimate that generic Columbus apartment investments will generate 6.3% total returns, #35 in the R50.

The CAA's March General Meeting on March 11th will feature a forecasting panel including Dan Hogan and Rob Vogt. They will share their market forecast and how it affects you and your company.

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