The Buzz, Holiday Edition: Stuck in the Chimney, Tenant Tips, & More

We’re well into the holiday season, with Christmas just around the corner. At a time like this, you don’t want to read abstracted projections about next year’s rental market, or brush up on landlord tenant law…you want holiday  goodness! So that’s what we’ve got–a  veritable buffet of winter tips and heartwarming (and/or unusual) stories. It’s a little holiday fun for a cold winter’s day.

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Stuck in a chimney just days before Christmas? Don’t be that guy.

There’s always one…this year’s ‘stuck in a chimney’ story comes from San Francisco, where a 33 year-old man was trapped for hours in his building’s ventilation ducts. “We still don’t know why he was there, in the first place,” fire department spokeswoman Mindy Talmadgi said. The man was taken to the hospital with cuts and bruises, and won’t be charged with a crime; whatever his motive, he’s got a story he’ll probably be telling for the rest of his life. Read more.

Quick tenant tips: Easy ways to keep thieves away over vacation

A lot of tenants will be heading out of town in the next few days; Detroit Property Managers have offered four easy ways their empty apartments can avoid detection by thieves. Among the tips to pass along to tenants: don’t post all over Facebook about your impending vacation; turn down the volume on your landline’s ringer, and avoid recording an “I’m on vacation” answering machine message (I know–who has an answering machine anymore?); ensure that doors and windows are locked tight; and inform your landlord or property manager of your plans. Simple steps, but they can ensure that a tenant–and his property manager–will enjoy a much happier New Year. Read more.

Awww…Canadian single mother-of-four wins one year free rent 

For the fourth year running, Boardwalk Rental Communities up in Canada teamed up this year with Virgin Radio Calgary to provide a year’s free rent to a deserving tenant living in one of their units. The winner, announced just in time for the holidays, was nominated by her 15 year-old daughter. She has four children and suffered a heart attack last year; when she was told that she had won, Lisa said (and I quote): “Holy cow!” Read more.

Chances of white Christmas next week in Seattle: five percent

The fire inside may be just delightful, but don’t count on any frightful weather out there next week–forecasters are reporting there is just a five percent chance of snow in the city on Tuesday. That’s even lower than the average yearly statistical probability that it will snow in Seattle on Christmas, which rings in at seven percent. All in all, it has snowed in Seattle on December 25th just five times since 1891–so you may not want to pull out your waterproof gloves just yet. Read more.

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That’s it for us today. You won’t see us on the blog next week, but we’ll be back to our regularly scheduled programming the Wednesday after next, just after we’ve celebrated the New Year. In the meantime, Happy Holidays from all of us at Seattle Rentals!

Seattle Centric: Gigabit Internet, New Units in Denny Triangle, & Contested Heights in South Lake Union

Brr! Winter doesn’t officially start until Friday, but it’s already getting very chilly out there–could there be snow in our future? However the weather goes, we hope you’re staying warm and cozy as you catch up on all the latest in Seattle-flavored rental real estate news. That’s right, it’s time for Seattle Centric! Let’s see what’s going on in the wide world of Puget Sound multifamily, shall we?

Construction for a new Denny Triangle apartment tower will begin in March.

Screen shot 2012-12-18 at 6.48.53 PMHave you spotted the demolition at 8th Avenue and Lenora Street? The two-story Cosmopolitan Motors building, which has occupied the space since 1925, is coming down–and in its place, a 40-story apartment building is set to rise. When complete, the GID Development building will house 355 units, as well as some retail space, and will sit just across Westlake Avenue from Amazon’s proposed complex. Read more in the Seattle Times.

What is the demand for apartment in the U-District? Vulcan is assessing.

Screen shot 2012-12-18 at 7.25.49 PMWhile Vulcan has traditionally focused on South Lake Union, lately the company has branched out into other areas. They submitted a bid on the Yesler Terrace redesign, and they’re on their way to redeveloping Bothel’s city hall, among other projects. Once such area is the University District, which has seen various new housing developments crop up in the past few years. The current plan is for 216 units, with accompanying commercial space, at 4041 Roosevelt Way N.E.; the company has held the site since 2001. But they have no yet decided to move forward on the project; first, they are assessing the neighborhood for demand. As Vulcan’s strategy director Lori Mason Curran put it, “we want to be aware of everything that’s happening there before we put a shovel in the ground.” If Vulcan does go ahead with the project, construction will begin this March; meanwhile, one thing is certain: the U-District will always need housing for its students and professionals. Read more in the Daily Journal of Commerce.

South Lake Union is sprouting up–and neighborhood advocates have concerns.

south lake unionSouth Lake Union has been in a state of growth for some time now, a fact which was not lost on Mayor Mike McGinn. The Mayor has proposed that towers as high as 400 feet, or about 40 stories, be permitted along Denny Way. Now, members of the South Lake Union Community Coalition have expressed their concerns about the proposal to the City Council’s land-use committee. Coalition members argue that 40-story buildings would dwarf others currently lining Denny Way, while some members of the land-use committee counterpointed, noting that buildings of that height are allowed “just south” in Denny Triangle. The council has not yet set a date to vote on the Mayor’s proposal. Read more in the Seattle Times.

Gigabit internet service is on its way to Seattle, and it could arrive as early as next fall.

ID-100109793Thirsting for some fast–that is, really, really fast–internet? Then you’re in the right place! The City of Seattle, the University of Washington, and broadband developer Gigabit Squared have partnered to bring gigabit internet to the city as early as next fall. The project will start out in just twelve “demonstration” neighborhoods, and then roll out to the city at large as they are able. So just how much faster is gigabit service? According to Gigabit Squared, in a few years, you’ll be downloading and uploading at speeds that are 1,000 times what we have now. Care for an Amazon Instant rental, anyone? Read more in the Puget Sound Business Journal.

That’s it for this edition of Seattle Centric! Stay warm out there…and good luck with your holiday shopping. Christmas is in less than a week, you know!

Apartment Advisor Recap, Part II: Looking Ahead

ID-1005998Happy Friday! Today we’ve got Part II of our December Apartment Advisor recap. Armed with data on job, migration, and interest rates; investment, supply, and demand trends, their partnership with Conway Pedersen for the economic nitty-gritty, and 30 years in the business, they’ve got predictions on how the next few years will go. Let’s see what they’ve got for us, shall we?

  1. Employment: Conway Pedersen expects the region to add 206,900 jobs over the next five years. When we look at the period between 2003-2008, when just 191,600 jobs were added, those numbers look pretty darn good!
  2. Demand: Q3 of this year showed 7.9 jobs to each occupied apartment; that means we should see about 26,200 additional rental units added over the next five years. With population growth, net migration, Gen Y renters and other factors in the mix, Dupre + Scott is expecting demand for about 29,000 total units.
  3. Supply: Over 30,500 units are expected to open in the King, Snohomish and Pierce counties over the next five years. Apartment Advisor puts that down to about 8,000 in 2013, rising to perhaps 9,100 in 2014, and then slowly tapering off in the years after, with about 3,900 in 2017.
  4. Vacancy: September’s market vacancy (that’s excluding units in construction and renovation) hit 4.8%, with gross vacancy at 5.5%. By late 2013, market vacancy should rise slightly to 4.9%, while gross will fall to 5.2%, as job growth and rental culture will keep demand strong. But after 2013, both rates are expected to start climbing–they’ll peak in Q1 2015 at about 6.4% and 7.3%. Those numbers, similar to those seen between 2002 and 2004, indicate oversupply–but not drastically so.
  5. Rent: As a rule, rents climb until vacancy hits 7% or so–then they start declining. Based on the vacancy forecast, we’re looking at a 2.8% climb in rent during 2013, before the supply of new units catches up to demand; in 2014, there will be higher vacancy and rent will rise less than 1%. We should see a 1.3% increase in 2015, as supply and demand gets back into equilibrium once more.

Those are some of the highlights of what Dupre + Scott are predicting, and there’s lots more info in the issue itself–check it out here. But for now, enjoy your weekend (and/or get your holiday shopping done). Christmas is just around the corner!

Apartment Advisor Recap, Part I: Life as We Know It

A holiday chill is in the air–December has arrived, and it’s that time again: time for Dupre + Scott to work their prognostication magic (ok, so it’s not so much magic as informed deduction) and tell us what lies in the multifamily industry’s future. That’s right, the Forecast issue of Apartment Advisor is out!

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Of course, any decent forecast begins by laying out the current situation. We’ll go over Dupre + Scott’s key numbers for December today, and pick up on Friday with their forecasts for the next few years. So without further adieu, we give you: the December numbers recap. Enjoy!

  1. Price Trends: The current average price paid for multifamily buildings (five units and larger) in King, Snohomish and Pierce counties is $137,070–that’s up 16% from last year, and hitting above the 2008 peak for the first time.
  2. Gross Multiplier: Historically, properties have sold at about 8.3 times the annual gross income. But after 2004, investors became willing to pay more for a property that would generate less income, and the gross multiplier rose. Currently we’re at 10.6, up 7% from last year.
  3. Cap Rates: After hitting 7.4% in 2000, these fell to 4.8% seven years later, after which they again began to climb. The last peak hit in 2010, at 6.2%; currently, we’re at a 5.6% average–and falling.
  4. Expenses: In 2011, operating expenses averaged $4,713 per unit (up 3% compounded annually from 2001). Dupre + Scott notes that landlords and investors controlled costs well in 2011, as they rose just 1.9% over 2010.
  5. Capital Expenses: Last year, capital expenses averaged $493. It’s worth noting that most investors underestimate the reserves that will be needed for a unit each year. While units that are less than 20 years old may squeak by with just $350 or so budgeted per year, older units are more likely to require a yearly budget of $600-$700. Be warned!
  6. Sales Volume: $2.2 billion of 5-unit and larger properties have been purchased this year to date–that makes 2012 the fourth highest volume year. Closing sales, however, tell a slightly different story; currently at 244, they’re not hitting anywhere close to the 2005 peak of 660. Dupre + Scott notes that most analysts now consider 2005 an anomaly, and we can expect to see numbers more like this year’s as we move forward.

There you have it–the state of the union, as it were, for Pierce, King and Snohomish counties. We’ll pick up on Friday with the Apartment Advisor forecasts for the year ahead (and beyond). See you then!

Under Construction: Units on their Way in Belltown, South Lake Union, Queen Anne, & More!

Happy Friday! There’s a ton of festive happenings this weekend–check out the weekend event calendar here if you’re looking for things to do. And as you tool around town, it’s a safe bet you’ll head past at least one site where new multifamily units are going up, or a new apartment building has been proposed. In our new Under Construction feature, we’ve got a rundown on new construction and proposed projects. Whether it’s your next home, your next employer, or your future competition, you need to know all about it!

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Under Construction: Via 6

  • What: A cycle-centric building with 250 bike parking stalls
  • How (many): 654 units in 24 stories (1,000 square feet)
  • Where: At the point where Downtown, Belltown, and South Lake Union meet
  • When: The building is currently under construction; their leasing office is taking applications now
  • For more: Read the Seattle Times article

Under Construction: The Europa

  • Who: Holland Partners
  • What: A seven-story mixed use building with bicycle storage and rooftop decks
  • How (many): 100 apartment units will sit atop 3,000 square feet of commercial space; underground parking will accomodate 90 vehicles
  • Where: On Dexter Avenue, in South Lake Union
  • When: The project is currently under construction; the completion date is TBD
  • For more: Check out the GroupArchitect project page

Planned: 450 Units in Bellevue

  • Who: Goodman Real Estate
  • What: Four separate buildings, rising up to six stories, with an underground garage below
  • How (many): The buildings will rise up to six stories, housing a total of 450 units
  • Where: Overlake, between Northeast Bel-Red Road and 156th Avenue Northeast
  • When: Construction is expected to begin in July 2013 and be completed by December 2014
  • For more: Read the Seattle Times article

Under Construction: H20 Apartments

  • Who: Euclid Development
  • What: A six-story building with five intriguing live-work lofts included in the design
  • How (many): 40 apartment units, plus 1,900 square feet of retail space
  • Where: West Harrison, in Lower Queen Anne
  • When: Construction began in November of last year and is scheduled to wrap up this coming January
  • For more: Check it out in urbnlvn.com

Proposed: Junction Flats

  • What: A four-story building proposed to replace two single-family homes and a triplex currently on the property
  • How (many): Four stories is the max height allowed in that area; it will house approximately 70 units, with underground parking
  • Where: The 4400 block of 42nd SW, across from Hope Lutheran Church
  • When: This project is still in the planning stages–its Early Design Guidance meeting is on January 10th–and if all goes as planned, construction would begin in early 2014
  • For more: Read the West Seattle Blog article

That’s it for today–but there are plenty more where those came from! Check back soon for more construction updates. In the meantime, the weekend is about to start…get out there and enjoy yourselves! We’ll see you next time.