Search
 

Multifamily Leads NOI Growth in CMBS

Although its year-over-year improvement in NOI was lower for 2016 compared to 2015, the apartment sector was still ahead of all others by a comfortable margin, Fitch Ratings said Friday.

By Paul Bubny | paulbubny | Updated on September 22, 2017

Exterior of luxury apartment building The Ocean at 1 West Sgt. in Lower Manhattan posted the biggest annual NOI growth among apartment properties backing CMBS loans of greater than $50 million.

NEW YORK CITY—NOI in properties backing CMBS showed slower growth across the major property sectors in 2016, Fitch Ratings said Friday, although a couple of sectors showed slight increases from the previous year. The average of 2.3% improvement for properties securitized within the Fitch-rated US CMBS multi-borrower universe compares to NOI growth averaging 3% in 2015, 3.2% in 2014, 2.5% in 2013 and 2.5% in 2012.

Although its pace of growth was off by 800 basis points compared to the year prior, multifamily was comfortably in the lead with NOI growth of 4.6%. The ratings agency said the apartment sector is peaking but is expected to show continued growth in NOI thanks to favorable demographics, albeit at a considerably slower pace due to the declines in rent growth and increases in vacancy that are forecast for the next few years. Seventy-one percent of the multifamily properties, by Fitch-rated loan count, reported an increase in NOI for last year.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.