The NRP Group, one of the nation’s largest developers, builders and managers of multifamily properties, is expanding west from its Midwestern roots to develop mixed-income and affordable housing in Phoenix and Las Vegas for the first time.
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“The Phoenix and Las Vegas markets are among the fastest growing in the nation, and the need for our caliber of rental communities is mounting,” Chris O’Neill, NRP executive vice president of development in Texas, said in a press release.
NRP hired former Ardour Co. Managing Partner Mike Moriarty and former Wolff Co. development associate Austin Kates to lead its entrance into the two markets, which have seen a boom in population and housing over the last few years.
The metro area population of Vegas has increased 8% since 2019. Over the past two years, more than 139,000 people moved to Phoenix, according to the Census Bureau, and Maricopa County saw the largest population growth in the U.S. since 2010. Phoenix also ranks fourth in the nation as far as home development, and Nevada has nearly doubled the amount of available multifamily units in the last five years.
“Since the pandemic, Las Vegas multifamily development has seen numbers surge to the highest point in more than a decade, all while experiencing a healthy occupancy rate,” said Moriarty, who is assuming the role of vice president of development in Las Vegas.
Las Vegas’ multifamily occupancy rate is 91% and average rent sits around $1,400 across unit sizes. In Phoenix, one-bedroom apartments average $1,453 and the occupancy rate is 94%. The national average rent for a market-rate unit was $1,716 in May, according to Yardi.
Kates, who will serve as NRP’s vice president of development in Phoenix, said that metro is coping with a long-term imbalance of housing supply vs. demand as it has expanded its employment base.
Because of the boom in new construction during the pandemic, rents in these Sun Belt cities are falling for multifamily units, which is part of a national trend.
Vacancy rates for apartments in the United States have hit a two-year high of 6.4%. That may dip further as the sector has seen unprecedented development in the past year, with over 529,000 apartments breaking ground. As a result, landlords who were able to push rents by 25% during the first two years of the pandemic due to demand are finding their bargaining power shifting to tenants.
The NRP Group manages more than 25,000 multifamily units and has developed more than 50,000 since its inception. It has 15 offices across the East Coast, South and Midwest.
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