STALLED PROJECTS BECOME UNSTALLED
|Our shelf has the usual chotchka: model airplanes, yearbooks, unidentified take-out meals. But multifamily developers have entire buildings up there, and they're starting to dust them off.|
The first wave of deals picking up steam are those that had been ready to go in 2007 and 2008 but then set aside, according to Behringer Harvard EVP and Behringer Harvard Multifamily REIT I COO Mark Alfieri. He tells us the REIT was focused on acquisitions, but has now shifted toward development. BH has equity and mezz-financing programs that are allocated to development. And Mark says he's also pinpointed several sites and hopes to lock-in costs soon. (Like everyone else breaking ground now, new product won't be delivered until 2013 or 2014.) Meanwhile the stars are aligning:occupancy and rents are rising as high as he's ever seen them. The next two years will be very strong for rent and NOI growth and Mark anticipates another housing bubble with more units needed to meet the demand.
Mark, here with Invesco's Greg Kraus at Bisnow?s first Multifamily Summit last year. He did such a good job we've asked him back to our second Multifamily Summit on June 29 at the Westin Center. (You can still register.) ?The multifamily market will be at maximum occupancy within two years. As the new supply starts coming online, the older, obsolete units will be filtered out,? he tells us. As a result, apartment rents will rise to historic levels, but the new supply is needed to meet demand. When it comes to personal growth, Mark?s downsizing. Two of his children just graduated high school and have plans to attend Texas A&M and Arkansas. One more kiddo remains for another year and then Mark is heading for Highland Park or Uptown. (Both areas are putting together offers trying to woo him.)