Still Seller's Market for Multifamily
New York’s TGM Associates has sold the 238-unit Hidden Forest Apartments in Fairless Hills for $21.3M to Castellan Real Estate Partners, a private NY investor. CBRE’s Bob Miller—who brokered the deal with colleagues John McFadden and Matt Stefanski—tells us New York investors like Bucks County for its proximity, and this particular property enjoys easy access to I-95 and the PA & NJ turnpikes. Hidden Forest’s 98% occupancy, plus its renovation under TGM’s institutional management, sweetened the pot for the buyer. CBRE’s Philly team has already brokered more than 2,000 units so far this year: Other sales include the Towers at Wyncote, American Loft in Northern Liberties, and Stonybrook (pictured at right) and The Villager both in South Jersey.
Bob sees Philly’s multifamily market fundamentals holding strong and steady: Occupancy rates are 95% or above at most properties. He says that it remains a seller’s market, with buyers outnumbering available properties and not enough new construction. High barriers to entry, zoning restrictions, and construction costs (especially in Center City) mean we’re not seeing as much new supply as in markets like Phoenix and Atlanta. On the flip side, Bob adds, there’s no worry about overbuilding, and declining homeownership, demographic trends favoring rentals, and cheap borrowing rates are keeping investors attentive.