ORLANDO—In the Greater Orlando area, all signals point to a seller's market in multifamily. So says Greg Wilson, a director of multifamily services for Colliers International in Orlando. GlobeSt.com caught up with Wilson to find out six key factors signaling a seller's market in Orlando multifamily and its surrounding areas. Here are the first three:
1. Vacancies Continue to Drop
In general, the Orlando multifamily market is very healthy. According to Colliers' research, in the past six months the overall vacancy rate has dropped from 6.2% to 5.8%, with the addition of more than 900 new net renters to the market.
“Several submarkets are doing extremely well, most notably the Winter Park/Hwy 436 corridor, the Orlando International Airport and Lake Nona/UCF Medical Complex area,” Wilson tells GlobeSt.com. “And the area near the tourist attractions, all of which have vacancies under 5%.”
2. Job Growth Will Impact Demand
The Orlando area added approximately 25,000 jobs in the past year, Wilson predicts. The unemployment rate is currently about 7.8%.
“With major medical construction, mass transit and other positive development initiatives underway, we can expect to see job growth continue in the area,” he says. “It's important to note job growth will determine multifamily demand and overall vacancy. As the economy expands, Orlando will experience substantial multifamliy unit absorption, and demand will cause vacancies to drop further.”
3. New Construction Slowly Ramps Up
In response to the declining multifamily vacancy rates, developers in the greater Orlando area started breaking ground on new multifamily construction about eight months ago, Wilson says. He notes there are currently about 2,500 multifamily units under construction.
“However, approximately half of these may not be delivered for 12 months or more,” Wilson says. “Based on the current rate of construction and with an expectation for modest job growth, we estimate overall vacancy will drop from 5.8% to 4.9% within the next 12 months.”
Be sure to come back this afternoon for part two of this exclusive interview and get three more factors signalling an Orlando multifamily seller's market.
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