Orange County Apartment Rents Keep Rising
As occupancy tops 96%, multifamily investment sales dropped 90% in third quarter.
The average apartment rent in Orange County set another record in the third quarter, hitting $2,854, a 1.8% increase over the previous three months.
The Newport Beach and South Irvine submarkets topped the leaderboard in Q3 in Orange County with average rents of $3,439 and $3,404, respectively, according to CBRE’s latest market report.
The occupancy rate in OC’s multifamily market ticked up to 96.2%. The market saw 1,213 completed units delivered in Q3, with a total net absorption of 1,406 units.
Despite strong market fundamentals, multifamily investment sales in Orange County cratered in the third quarter, dropping to $58.5M from the Q2 total of nearly $568M, a cliff dive of nearly 90%. The average investment sale price per unit, which two years ago topped $500K, was $300K in Q3 2024, CBRE reported.
Orange County’s multifamily market has experienced significant demand over the past year fueled by in-migration as the county’s population grew to 3.2M residents.
There are more than 5,400 apartment units under construction in OC, with recent deliveries including The Row at Red Hill in Santa Ana, a campus with 1,100 units developed by Greystar, and The Pistola, and TA Partners’ 371-unit campus in Irvine.
Earlier this month, the Irvine City Council re-zoned the Irvine Business Complex adjacent to John Wayne Airport, opening up the 2,700-acre business district for high-density housing of up to 15,000 units.
Irvine joined Newport Beach, Santa Ana and Costa Mesa in overriding an Orange County Airport Land Use Commission ruling which cited noise and safety concerns that deemed re-zoning for housing “inconsistent” with the Airport Environs Land Use Plan for the area surrounding the airport.
Since January, the Newport Beach City Council has approved three apartment projects in proximity to the airport. The city has identified the opportunity for an additional 2,577 housing units in the area around John Wayne Airport.
In July, the council approved a seven-story, 282-unit apartment building at 1600 Dove Street, a site currently occupied by an office building.
In May, the group of elected officials approved two projects, filed by separate developers, with each involving the demolition of aging office buildings near the airport.
A 23K SF office building will be torn down at 1401 Quail Street to make way for 67 condos that will be built by Vancouver-based Intracorp. Eight of the condos will be designated as affordable housing at the project, which will include a 146-space parking structure.
At 1400 Bristol Street, a 29K SF building will be demolished and replaced with a 229-unit apartment complex by Picerne Group, a local developer.