Institutional Buyers Shun Phoenix Apt. Market

PHOENIX-Worried about multifamily overbuilding and the slow growth of rents, institutional investors are steering clear of Phoenix, says a local real estate expert.

The number of bids coming in on apartment complexes in the Valley is down by approximately 30%, Sean Cunningham, a multifamily specialist and senior vice president in the Phoenix office of CB Richard Ellis tells GlobeSt.com. “The institutional investor is absent in Phoenix right now,” he says.

REITs haven’t been active in the Valley for more than two years. With the recent loss of institutional investors, all that’s left to bid on class-A and B projects are private investors, he says. A number of apartment owners have recognized the market is flat and have ceased to market their properties until they see signs of a turn-around, he says. “There is less inventory to purchase than in prior years,” he says.