The "game has changed" in terms of financing these days, according to MacFarlane Partners chairman and CEO Victor MacFarlane.
:quality(75))
While this has been one of the longest economic recoveries of late, "it’s clear there’s been some regulatory pushback in terms of construction," said Victor, who was one of the featured speakers at Bisnow's Annual Multifamily And Mixed-Use West Conference.
The multi-decade real estate veteran said interest rates are scaring him "because they’re not following any historical or predictable fashion."
One possible scenario could be we're headed toward a bubble, he said.
:quality(75))
"Yield is driving everything today," Victor said.
He singled out firms building high-end multifamily projects. "When you start factoring in what these young adults have to make to afford a $6k/$7k/$8k rent number, it’s a pretty big income even if they start doubling up," he said.
Victor told the more than 400 gathered it takes a lot of equity now to get a deal done.
He also updated the crowd on Park Fifth (the firm's project in downtown LA). MacFarlane Partners is building both a mid-rise and a high-rise and funding a nonprofit to work on the Pershing Square Renew project creating a park downtown, which he thinks is important.
Construction recently began on the mid-rise at Park Fifth. Construction should start on the high-rise in September or October, according to Victor.
:quality(75))
Colliers International EVP Kitty Wallace (above), along with Decron Properties VP Daniel Nagel, The Fifield Cos COO Kevin Farrell, Polaris Pacific partner Paul Zeger, Google Fiber head of real estate partnerships Peter Albers and Berkadia senior managing director Dean Zander spoke on a panel about finding and creating value in multifamily.
Kitty said residents want to "live, work and play in the same place."
Location, efficiency and creating a sense of community for residents are key elements, according to Kitty.
:quality(75))
The panelists agreed apartment communities today have more expansive amenities than before, which often include dog wash stations and yoga decks.
There is also a trend toward smaller units.
It is important to figure out which amenities allow builders to get the highest rent, the panelists said.
:quality(75))
WiFi and connectivity are big draws and have become among the expected amenities, panelists said.
Daniel (above left) said residents these days are also looking for meaningful, usable amenities, including fitness centers.
)
)
)
)
)
)
)
)
)
)
)
)