Despite a disruptive pandemic, investor demand for multifamily real estate was strong in 2020, according to a newly released Yardi Matrix Bulletin.
Around 252,000 apartment units were absorbed last year. That’s about 1.7% of total market stock and down 12% from the 286,300 apartments purchased in 2019.
“Considering the economic and social calamity that befell the U.S., in many respects due to COVID-19, the fact that demand held up as well as it did is a relief for the apartment industry,” say Matrix analysts.
Net absorption was strongest in 25 of the 30 largest metros, which accounted for 158,300 units absorbed. Dallas, Atlanta and Denver saw the highest absorption rates.
Negative absorption was centralized in key gateway markets hit hard by COVID-19, which also struggled with renter demand and average rents. The worst performers were the Bay Area and New York City, which combined for -22,100 units absorbed in 2020.
Overall, high-cost gateway metros had net absorption of -0.3% (-7,600 units). Demand was better in secondary (154,100 units, or 2.3% of total stock) and tertiary (96,200 units, or 2.0% of stock) markets.
On a regional level, renters continued to flock to the Southeast (96,700 units absorbed, or 2.4% of total stock), the Southwest (56,800 units, 2.1% of stock) and the West (57,100 units, 1.9% of stock). Meanwhile, demand was slightly positive in the Midwest (27,100 units, 1.1% of stock) and the Northeast (4,900 units, 0.2% of stock).
Here are the top 10 markets based on net multifamily absorption in 2020:
1. Dallas: 19,233 units; 2.4% net absorption of total stock; 93.8% occupancy rate in Dec. 2020
2. Atlanta: 12,864; 2.8%; 94.7%
3. Denver: 11,552; 4.0%; 94.5%
4. Phoenix: 10,082; 3.2%; 95.5%
5. Houston: 8,377; 1.3%; 92.1%
6. Austin, Texas: 7,893; 3.1%; 93.3%
7. Miami: 7,721; 2.5%; 94.4%
8. Tampa, Fla.: 6,196; 2.8%; 95.4%
9. Charlotte, N.C.: 6,073; 3.3%; 95.1%
10. San Antonio: 5,836; 2.8%; 93.0%
Related Stories
| Jul 18, 2014
Top Engineering Firms [2014 Giants 300 Report]
Fluor, Arup, Day & Zimmermann top Building Design+Construction's 2014 ranking of the largest engineering firms in the United States.
| Jul 18, 2014
Top Architecture Firms [2014 Giants 300 Report]
Gensler, Perkins+Will, NBBJ top Building Design+Construction's 2014 ranking of the largest architecture firms in the United States.
| Jul 18, 2014
2014 Giants 300 Report
Building Design+Construction magazine's annual ranking the nation's largest architecture, engineering, and construction firms in the U.S.
| Jul 17, 2014
A harmful trade-off many U.S. green buildings make
The Urban Green Council addresses a concern that many "green" buildings in the U.S. have: poor insulation.
| Jul 17, 2014
A high-rise with outdoor, vertical community space? It's possible! [slideshow]
Danish design firm C.F. Møller has developed a novel way to increase community space without compromising privacy or indoor space.
| Jul 11, 2014
First look: Jeanne Gang reinterprets San Francisco Bay windows in new skyscraper scheme
Chicago architect Jeanne Gang has designed a 40-story residential building in San Francisco that is inspired by the city's omnipresent bay windows.
| Jul 10, 2014
Unique design of Toronto's townhome The Tree House
Plans for a new Toronto townhome brings cutting-edge design.
| Jul 7, 2014
7 emerging design trends in brick buildings
From wild architectural shapes to unique color blends and pattern arrangements, these projects demonstrate the design possibilities of brick.
| Jul 7, 2014
A climate-controlled city is Dubai's newest colossal project
To add to Dubai's already impressive portfolio of world's tallest tower and world's largest natural flower garden, Dubai Holding has plans to build the world's largest climate-controlled city.
| Jul 3, 2014
Gehry edits Canadian skyscraper plan to be 'more Toronto'
After being criticized for the original tower complex, architect Frank Gehry unveils a new design that is more subtle, and "more Toronto."
