Are downtown apartment occupancy rapidly trending down?

[normalthings]

Berkadia: Metro rental demand is up 30% since March as rents have continued to increase. Berkadia notes KC has specifically been attracting wealthy, highly educated, and tech workers types to the core. Metro occupancy rates have dipped slightly but it is attributed to the completion of many new buildings.

[DaveKCMO]

Berkadia: Metro rental demand is up 30% since March as rents have continued to increase. Berkadia notes KC has specifically been attracting wealthy, highly educated, and tech workers types to the core. Metro occupancy rates have dipped slightly but it is attributed to the completion of many new buildings.

Do you have a link? Would like to share.

[earthling]

^Yeah even though occupancy down the report says absorption/demand still pretty solid given COVID (difficulty to show). Delivered units even higher so slight drop in occupancy. Central KCMO represented half delivered units of metro in Q2 and well over 1/3 the absorption/demand.

https://www.berkadia.com/wp-content/upl ... s-City.pdf


In comparison, STL City/CWE had few deliveries Q2 and negative absorption.

[FangKC]

I wish we had stats about where people are moving from into central KCMO apartments.

[normalthings]

Business Insider ranked KC as the #1 city for Work From Home.

https://www.businessinsider.com/best-ci ... r-own-boss

[earthling]

Not only a great city for WFH but also for digital nomads (well, before COVID sidetracked it). The ranking doesn't surprise me as first hand I've pointed out recently why KC is becoming a good city for digital nomads, especially downtown.

edit: Here's the full list...
https://overheardonconferencecalls.com/ ... mote-work/

Interesting that NYC and LA are ranked among lowest as I agree having done the hobo w/laptop roaming in both cities for years. Atlanta and Miami also ranked in territory of my experiences.

[Chris Stritzel]

Business Insider ranked KC as the #1 city for Work From Home.

https://www.businessinsider.com/best-ci ... r-own-boss

Another list ranks KC Number 1 for the same thing in addition to affordability among other things. This defines specific things to make the list clear to people who may have questions. Like this...

- Cost of living (40%): One perk of remote work is that your salary could stretch further if you move somewhere with a lower cost of living. We’ve weighted this factor more heavily than others, as it will have a big impact on your lifestyle and the options for affordable real estate in the area.
- Wi-Fi speed (20%): You’ll need reliable Wi-Fi if you don’t want your Zoom calls to lag. And while you’re at it, check out the other top tools that make remote workers successful, and find out how to lower your internet bill.
- Delivery options (10%): What’s the point of living somewhere your salary stretches further if you can’t use the extra money to order a vat of sushi or baked pasta to be delivered to your door every weekend? We’ve got you covered with the comfort of delivery from a selection of nearby restaurants.
- Parks per capita (10%): When you’re ready to walk off all the grub, you’ll need green space so you have room to exercise.
- Proximity to a major airport (10%): As much as we think you'll love these cities, we know how important it is to get away from time to time. COVID-19 might be slowing down travel plans right now, but when you're ready to vacation, you'll be ready to fly.
- Affordable three-plus-bedroom homes on the market (10%): We assessed the percentage of three-plus-bedroom homes available below the median home price in the area to ensure you would have plenty of options for home buying within your budget.

Across the state, STL ranks at number 8 in this list and ranked at number 15 in the Business Insider list. So it's good to see Missouri's two big cities in the Top 20 and Top 10. These are solid numbers and I would hope and assume it leads to some more people moving in or continue to see the flow of people moving in.

Here's what they had to say about KC...

A low cost of living and above average broadband speeds make Kansas City ideal for remote work, and you’ll find a vibrant arts scene and plenty of options for dining. Kansas City is known for its barbecue restaurants and local distilleries.

https://financebuzz.com/best-cities-for-remote-workers

[normalthings]

Kansas City apartment market Rent growth expected to be second highest in the US for year 2020.

https://www.bizjournals.com/kansascity/ ... demic.html

[earthling]

With metro areas like NYC and SF Bay areas experiencing an exodus partly due to COVID directly and partly due to expanded work from home/anywhere allowing many to leave, I wonder if KC is attracting some of them. KC housing is getting tighter despite uptick in home construction and while growing supply of apts is slightly higher than demand there is still uptick in demand.

KC is not hit as hard with job losses but still significant losses so something is offsetting, such as WFH outsiders moving in and maybe retirees as well? Could also be attracting unemployed leaving more expensive cities with no job in KC. Will be interesting to see 2020 migration data next Spring.

[longviewmo]

With metro areas like NYC and SF Bay areas experiencing an exodus partly due to COVID directly and partly due to expanded work from home/anywhere allowing many to leave, I wonder if KC is attracting some of them. KC housing is getting tighter despite uptick in home construction and while growing supply of apts is slightly higher than demand there is still uptick in demand.

KC is not hit as hard with job losses but still significant losses so something is offsetting, such as WFH outsiders moving in and maybe retirees as well? Could also be attracting unemployed leaving more expensive cities with no job in KC. Will be interesting to see 2020 migration data next Spring.

Keep on seeing this brought up on reddit too. I think KC’s supply pinch might be more to the inventory being about half of what it was this time last year.

[earthling]

^For homes. That impacts the pricing however home sales this July were higher than any month over last year+ too. New home construction starting to pick up but seems most want existing homes in established neighborhoods. For apts, supply is keeping up with demand, slightly higher than demand.

[flyingember]

^For homes. That impacts the pricing however home sales this July were higher than any month over last year+ too. New home construction starting to pick up but seems most want existing homes in established neighborhoods.

It's because the new home market appreciated so much.

The new row homes in NKC just off Macken are around $320k. One of the older row homes one block away sold a year ago closer to $250k. There's basically 150 sq feet more space in the new one and the price is 30% higher. The old one is from 2006, it's not exactly old for that town.

It's partially greed, a new developer is finishing the last homes, but also shows how much cost inflation there's been.

Many people that used to buy new are priced out of that market. It's having a snowball effect going down the market.

There's another good example of existing neighborhood new construction in Crestview at $262 per square foot
https://www.zillow.com/homedetails/3838 ... 6486_zpid/
Apparently they thought it was under priced...

Same neighborhood, same bed and bath
https://www.zillow.com/homedetails/901- ... 6077_zpid/
Sold around $100 per square foot.

Bigger home, closer to $90 per square foot.
https://www.zillow.com/homedetails/4106 ... 6223_zpid/

[DaveKCMO]

^For homes. That impacts the pricing however home sales this July were higher than any month over last year+ too. New home construction starting to pick up but seems most want existing homes in established neighborhoods. For apts, supply is keeping up with demand, slightly higher than demand.

Huge SFH infill opportunity, which KCMO will continue to squander (because it's too hard to do).

[flyingember]

^For homes. That impacts the pricing however home sales this July were higher than any month over last year+ too. New home construction starting to pick up but seems most want existing homes in established neighborhoods. For apts, supply is keeping up with demand, slightly higher than demand.

Huge SFH infill opportunity, which KCMO will continue to squander (because it's too hard to do).

A developer that can come in with $150 per square foot, 1000 sq foot homes will make a killing.

Two bed, two bath. Single kitchen, living room without a separate dining room.

15x30 for the public space is reasonable. That's what our biggest space is and for someone on a budget that's a nice family room

[normalthings]

^Yeah even though occupancy down the report says absorption/demand still pretty solid given COVID (difficulty to show). Delivered units even higher so slight drop in occupancy. Central KCMO represented half delivered units of metro in Q2 and well over 1/3 the absorption/demand.

https://www.berkadia.com/wp-content/upl ... s-City.pdf


In comparison, STL City/CWE had few deliveries Q2 and negative absorption.

CoStar 2nd Quarter Apartment Absorption Rankings. KC made the top 15 in the US per their report. CoStar has KC above 1,200 units absorbed for the quarter which is fantastic news.

CoStar is the most comprehensive real estate database available. The firm also owns Loopnet and Apartments.Com

[normalthings]

15-20% 4-5 Star Vacancy reported for Urban Core

[normalthings]

APARTMENT DEMAND EXCEEDS DELIVERIES AFTER COVID-19 SLUMP

Apartment demand shifted up occupancy in the Kansas City metropolitan area during the third quarter. Residents newly occupied 1,986 net units during the last three months--the Central Kansas City area led leasing activity with 913 units absorbed. Developers worked to meet heightened demand in the central Kansas City submarket, though the 876 units delivered fell short and caused occupancy to rise to 94.0%. This trend was reflected across Greater Kansas City as the 1,678 deliveries trailed leasing activity to push up occupancy 20 basis points from the second quarter to an average of 95.3% in the third quarter. With occupancy up quarter over quarter, operators advanced effective rent 0.7% to $1,005 per month. To help drive demand in the Central Kansas City submarket amid rising competition because of new inventory, operators increased concessions as effective rent lowered to an average of $1,266 per month in September from $1,291 per month in June. Underpinning the metro’s resilient rental market were nearly 6,000 new or recovered jobs added in July and August, aided by tapering coronavirus restrictions.

https://www.berkadia.com/research-and-r ... tate_code=

[Walker]

I read that downtown construction is down compared to the rest of the metro. Sounds like we are in need of wave 3.

[earthling]

Here's Colliers' Q3 multifamily report..
https://www2.colliers.com/en/Research/K ... ily-Trends

It doesn't break out downtown from Central KCMO but Central KC blew out rest of metro with new units, 8.8% increase for Central KC vs. 2.8% for metro.

[beautyfromashes]

It doesn't break out downtown from Central KCMO but Central KC blew out rest of metro with new units, 8.8% increase for Central KC vs. 2.8% for metro.

Some of us remember when this would have only happened in a dream.