by Blerim Zeqiri
With the arrival of May, more than half of the states are starting to open up to one degree or another, with the rest making plans to do so in the near future. And as the country inches out of lockdown mode, we continue to see improvement in the leading indicators of traffic and leases.
During the week ending on May 6, both of these metrics increased on a national basis when compared with the preceding seven days, according to new data from Radix.However, these improvements have yet to be reflected in “downstream” operating stats, as leased and occupancy rates and net effective rent all declined on a week-over-week basis. In fact, the national leased and occupancy rates declined for the sixth straight week.
With that broad overview, here are some the major specific takeaways from the week, ending on May 6:
Nationally, traffic and leases were up 11.4% and 12.3%, respectively, WoW. Unfortunately, they were down 47.4% and 25.3%, respectively, YoY.
The national same-store occupancy rate stood at 92.97%. That represents a dip of 0.29% from one week earlier and 1.24% from one year earlier.
As for individual markets, all of the MSAs tracked by Radix experienced WoW decline in occupancy rates – with the exception of San Francisco, which saw a small improvement of 14 basis points. Orlando and San Diego experienced the largest YoY occupancy declines, with drops of 2.40% and 2.03%, respectively.
The national same-store leased rate was 94.40%. That’s a decline of 0.28% from the preceding week and 1.36% from the same time last year.
At $1,798, the average net effective rent in the U.S. was down 0.6% from one week earlier but was still 0.5% higher than it had been at the same time in 2019.All of the MSAs tracked by Radix experienced WoW declines in net effective rent except for Miami (up 0.7%), San Antonio (up 0.5%) and Seattle (up 0.5%).
Anecdotally, my conversations with our operator clients have revealed that virtual leasing is now making up a sizeable portion of all leases. However, this has also led to an increase in lease cancellations as well.
Moving forward, I hope you continue to check my MFI page as the pandemic continues, as I will be providing weekly updates of these stats. As always, I wish you, your families, your colleagues and your residents health and safety.