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SoCal Apartment Market to Stay Tight in 2001

LOS ANGELES-Experts say Southern California's multifamily market should get even stronger next year, despite solid gains in construction and a widely anticipated economic slowdown.

By Erin Cassin & David W. Myers | Updated on December 19, 2000

LOS ANGELES-Apartment builders, lenders and brokers say Southern California’s multifamily market should get even stronger next year, despite a big upturn in construction and a widely anticipated economic slowdown.

Though multifamily construction is up about 20% in the Southland so far this year, the addition of an estimated 25,000 units that have been built still badly lags demand, according to the Burbank-based Construction Industry Research Board. And while another healthy gain is forecast for 2001, forecasters at Grubb & Ellis say demand will still overwhelm new supply by a 12-to-1 ratio.

“From a demand side, there is no reason for the market to slow down,” says Barry Kamel, president of the multifamily development division of Sares-Regis Group, the Irvine-based real estate giant. “From a supply side, there are constraints on obtaining land. The market will remain status quo, which means it will still be a sellers’ and landlords’ market.”

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