LOS ANGELES—While speakers on the industry leaders panel last week at RealShare Apartments feel pretty good about where the multifamily market is—for the most part—some expressed slight concern about the level of supply—in the class A market that is.
The panel, moderated by John Sebree, vice president and national director of the national multi housing group at Marcus & Millichap, questioned whether or not we were reaching the max level of renters that can afford.
Michael J. Schall, president and CEO of Essex Property Trust Inc., said that “there is no such thing as producing B or C quality apartments. The new development is in the A category and it is one of the thinner parts of the rental pool.” He adds that “You are diluting the pool.”
Jerry Fink, co-founder and managing partner at the Bascom Group, agreed. “Taking San Francisco out of the picture, in other submarkets, there is a limited pool of class A consumers,” he said.
Schall added that “On the Bs, there seems to be good pricing with respect to the acquisition rehab.” He explained that his firm's number 1 metro in its portfolio is Oakland. “The B quality housing stock is making it attractive as people get priced out of A areas.”
One particular location that Schall worries about is Seattle, where he said that “if anything disrupts the economy there, you find yourself oversupplied pretty quickly.”
Switching gears a bit, when asked about foreign money, Jeff Day, CEO of Berkeley Point Capital LLC, said that on the equity side, there is the foreign investor that is in capital preservation mode. “That is a phenomenon that has been very prevalent, he said. “You will start to see more of those types of investors.”
Over 60 high-level speakers and nearly 2000 were in attendance at this year's RealShare Apartments event. The RealShare Conference Series is produced by ALM's Real Estate Media Group, which also publishes Real Estate Forum and GlobeSt.com.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
