Rental Apartment Market Normalizing

ATLANTA-Steady renter demand and investment interest are keeping the local apartment market healthy, even though transaction velocity is not at last year’s record levels it was last year, say market professionals. According to Marcus & Millichap’s 2008 National Apartment Report, 41,000 employment positions will be added in the Atlanta area this year, which, along with continued foreclosures in the single family market, are keeping the apartment market stable.

“We’re seeing reduced turnover at all our properties, and a commensurate increase in occupancy as a result of more people entering the rental pool versus the homeowner pool,” says Brand Inlow, chief investment officer of McCann Realty, which owns four rental properties in the Atlanta metro area. “Generally Atlanta, like Dallas and Houston, leads the country in job growth and household formation, which are the drivers for the apartment industry.”

McCann Realty, in a partnership with Silver Capital LLC, recently acquired Villas at South Point Apartments, a 284-unit, garden-style community located in the McDonough submarket of metro Atlanta. Silver-McCann Apartment Group II LP plans to make one more acquisition before closing the fund, bringing its total acquisitions to $150 million in less than two years.