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TAMPA / WESTSHORE MULTI-FAMILY UPDATE
Presented by:
Phillip A. Smith
Westshore Development Forum April 21, 2015
TOPICS
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• Economic Trends • Jobs, the Renter, and the Investor • Rent Growth • Regional Job Growth
• Tampa’s Supply & Demand • Challenges Facing our Rental Market
• Pipeline
NATIONAL TRENDS
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Jobs • As of year-end 2014, US recovered 88% of jobs lost in the recession
The Renter • Millenials
• Stagnant wages • Pressure to repay over $1 trillion in student loans
The Investor • Increased pension, endowment and life co. capital • Family office/private wealth • Increased asset sale prices and demand for new projects
Sources: Wall Street Journal, PWC Emerging Trends in Real Estate 2015, Marcus & Millichap National Apartment Report 2014
• Expanding mature renter • The “golf course retirement” model losing its luster • Current rent-by-choice lifestyle offers more than in the past
NATIONAL TRENDS—Rent Growth
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
Source: Axiometrics, Inc.
NATIONAL EFFECTIVE RENT GROWTH
REGIONAL JOB GROWTH
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FLORIDA* SOUTHEAST US
Source: US Bureau of Labor Statistics
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
-‐ 500 1,000 1,500 2,000 2,500 3,000 3,500 0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
-‐ 500 1,000 1,500 2,000 2,500 3,000 3,500
YOY
Gro
wth
YOY
Gro
wth
Jobs (1,000s) Jobs (1,000s)
Orlando
Miami
Jacksonville
Tallahassee Palm Bay
Naples
Tampa (5.3% Unemployment)
Dallas Atlanta Charlotte Raleigh
Austin
Houston
Memphis
Nashville
Columbia Greenville
Tampa
*But, biggest recent job creation was in Leisure & Hospitality, and Trade, Transportation & Utilities (includes Retail). CONSUMER CONFIDENCE-DRIVEN GROWTH
THE SUPPLY SIDE OF RENTAL HOUSING
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Source: ARA Florida Multifamily Snapshot Q1 2015
SUPPLY HIGHLIGHTS Total Inventory: 157,687 units Peak Inventory: 159,296 units (2004) Class A Occupancy: 95.4% '14 Production: 5,000 units (approx.) '15-'16 Production: 3,000-3,500 units (projected)
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1000
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4000
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6000
2000
2001
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2003
2004
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2011
2012
2013
2014
2015
2016
Annual Average ‘00-’14
Annual Average ‘00-’05
TAMPA APARTMENT DELIVERIES
THE SUPPLY SIDE OF RENTAL HOUSING
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WESTSHORE’S SUPPLY PIPELINE
4310 Spruce 262 units
Crescent Westshore 374 units
Grady Square 557 units
Varela 350 units
3
2
6
1
4
5 4
2 1
6
7
3
Rocky Point
Redstone/Austin 7
5
MetWest 254 units
THE DEMAND SIDE OF RENTAL HOUSING
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TAMPA HOUSING ALTERNATIVES: Buying @ $1,500/mo.
$200,000 FHA MORTGAGE @ 5.049% Median Price per SF: $106 Median Size @ $200k: 1,887 SF
CASH REQUIRED AT CLOSING Down Payment: $7,000 Origination Fee: $1,005 Transfer Taxes: $1,100 Insurance: $1,476 Deposits & Misc. Fees: $5,269 TOTAL: $15,850
MONTHLY HOUSING EXPENSES Mortgage Pmt: $938 Taxes: $287 Insurance: $246 TOTAL: $1,471
Source: Zillow.com and Zillow Real Estate Research
THE DEMAND SIDE OF RENTAL HOUSING
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METRO AREA TYPICAL RENT/SF
UNIT SIZE @ $1,500/MO.
Westshore $1.60 938 SF Downtown Tampa $1.95 769 SF Channelside $2.10 714 SF SoHo/Bayshore $2.20 682 SF
TYPICAL AMENITIES - On-site Gym - On-site Spa - Pool - Demonstration Kitchens - Balconies/Terraces - Gaming Areas - Clubhouses - Pet Spas, Dog Parks
TAMPA HOUSING ALTERNATIVES: Renting @ $1,500/mo.
TAMPA’S AFFORDABILITY CHALLENGE
Source: Zillow Real Estate Research
Atlanta
Dallas
Nashville
Jacksonville
Sacramento
Tampa = 32% of mo. income on rent
Phoenix
Chicago
Philadelphia
Boston
Seattle Portland
WESTSHORE’S WALKABILITY CHALLENGE
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Westshore delivers on accessibility but should become more pedestrian-friendly
ACTIVE PROJECTS AT FRAMEWORK GROUP VARELA
• Lois Ave & Spruce St • 350 Units • 5-story w/ structured
parking • Completion 2015
4310 SPRUCE • 262 Units • 5-story w/ structured
parking • Completion 2016
HARBOUR ISLAND • Knights Run &
Harbour Post • 235 Units • 21-story high rise • Completion 2016
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ON THE BOARD AT FRAMEWORK GROUP
YBOR CITY
SARASOTA
ORLANDO
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CONCLUSION
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• Investment in the multi-family sector is still robust; • Rent growth is steady; • Supply appears to be in check in terms of total
numbers, but mostly at the high-end; • Regional job growth is steady, but mostly at the low-
end; • Need more new high-quality jobs; • Wages are still stagnant, creating future affordability
concerns; • Need to maintain continued focus on Westshore’s
urban plan, transportation and walkability solutions to maintain competitive edge for attracting new businesses.
WWW.FRAMEWORKGROUPLLC.COM
@FRAMEWORK_GROUP Framework Group, LLC
