Portland Multifamily Demand Doubles Amount of Deliveries
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Portland, Oregon's multifamily sector is booming with demand, providing a boost to broader fundamentals in the market. That's highlighted by net absorption hitting 1,997 units in the second quarter, more than double the new supply of 928 units posted in the period, according to a market report from CBRE.All submarkets in Portland posted positive absorption, led by the +338 units seen in Aloha/West Beaverton.
Occupancy, as a result, improved, climbing 50 basis points quarter-over-quarter to 95.3 percent.
Average rent per unit increased, but modestly, up 0.9 percent from the first quarter to reach $1,750. However, it's nearly twice as cheap to buy in the city compared with renting — giving multifamily landlords a major affordability edge.
"Paying for a single-family home represented a 93% price premium over renting," CBRE said.
Meanwhile, it's two different stories for investment sales, as volume increased by 48 percent to $309.3 million on a quarterly basis and this actually represented one of the strongest three-month stretches of activity posted in recent periods, according to CBRE. However, volume is down 26.4 percent year-over-year.
The average price per unit was $196,849 per unit, which according to CBRE reflects "continued investor confidence in the market's fundamentals."
The most notable transaction in the second quarter involved the 322-unit property Ladd Tower, which traded hands for $63.3 million. Properties Carriage House and Grant Park Quimby were the next largest, going for $34.45 million and $30.70 million, respectively.
Source: GlobeSt/ALM