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Developers Keep Eyes on Properties in Other Sectors
The pandemic-fueled economic downturn has apartment developers on the lookout for opportunities to buy old hotels, office buildings and retail centers and convert the properties into multifamily communities. However, a wave of these kinds of transactions has yet to materialize, in part because distressed properties are still deemed too expensive. “There is just little interest on the part of developers to jump into anything like that at the moment,” said Jim Costello, senior vice president for data firm Real Capital Analytics, based in New York City. “Assets are not being sold at substantial discounts … yet.”
What Changes in Leasing and Operations Are Here to Stay?
In a flash, the coronavirus upended the multifamily industry. But when the pandemic finally comes to an end, certain quickly implemented new processes – such as self-guided tours and other types of self-service – will remain part of apartment leasing and operations. A significant part of the appeal of self-guided tours is that they allow prospective renters to customize their experience and see only what they want to see. No longer do they have to endure conversations and stops they feel are totally unnecessary to their decision-making.
Turning to Fido to Recover Lost Revenue
In the current softening market, many operators are turning to pets as a source of revenue. It’s been well-documented that adoptions of dogs and cats have risen during the pandemic, and this presents apartment communities with opportunities to mitigate the impact of stagnant rents. To start with, operators can increase their intake of pet fees by easing dog breed and weight restrictions. In addition, they should use a third-party screening service to thoroughly review reasonable accommodation requests and make sure they aren’t unnecessarily losing out on pet-related fees.
IN THE NEWS
Existing Homes Selling at Fastest Pace in 14 Years
August was another good month for the sale of previously owned homes in the U.S. Closing transactions rose 2.4% when compared to July to reach an annualized rate of 6 million – that’s the highest rate since late 2006. Meanwhile, prices increased 11.4% on an unadjusted basis from a year earlier on an unadjusted basis.
Struggling Retail Centers Look to Multifamily for Helping Hand
Retail owners who are watching their malls and centers struggle are looking to reinvigorate their properties by adding apartments. This trend has been in play for a while, say industry observers, but the economic impact of COVID-19 has served as an accelerant. The Connecticut Post Mall in Milford, Conn., and the Alderwood regional mall in Lynnwood, Wash., are among the retail properties that are either already slated to have new apartment homes onsite or could see multifamily homes in the near future.
Study: Pandemic Leads to Spike in Evictions
There’s no doubt the pandemic has weakened the ability of many apartment residents to pay their rent. A new survey from Snappt helps shed some light on the extent of the impact. According to the survey, 25% of renters are paying late, while 17% are paying less than their full rent and 11% have completely stopped paying. In addition, the study found evictions have skyrocketed by 75% since the start of the pandemic in March.