At Wednesday night's Apartment Association of Greater Orlando (AAGO) dinner meeting, market expert panelists remained collectively optimistic about the shape of Orlando area's rental market and its future.
In the past 6 months, Orlando has taken in around 2,000 renters while maintaining a vacancy rate of roughly 4.6%, according to a report by Real Data Apartment Market Research. More than 12,000 units were either under construction or en route to being developed during this period. Lydia Bishop, Managing Director at Greystar, explained that her company is seeing a significant amount of activity in the Orlando market. More and more property owners – many of whom tend to hold assets for extended periods – are placing their communities on the market. Buyers continue to snatch up these assets within days, behavior Bishop contends makes the Central Florida Multifamily Housing Market "the darling of the industry."
With such a low vacancy rate combined with burgeoning job opportunities and a heavy pipeline, it's clear why development is ramping up in the area's submarkets, most notably downtown Orlando. Mark Ogier, Principal at ContraVest recalled how at the same AAGO dinner a decade prior, speakers stated that Orlando's occupancy rate was 94% and it "was never going to be better." Now, Ogier states "apartments are the belle of the ball for real estate and those who want to invest." When the recession hit, there was a period of 4 to 5 years where nothing was being built. The recent spark of development in the Orlando area is helping to build the market back up again. Ogier argues that the market isn't seeing a new housing bubble, "We're simply catching up with the inventory that wasn't brought online."
The influx of job seekers looking to find the perfect apartment in the greater Orlando area has certainly been a boon to new communities like Station House in Lake Mary, which opened in December 2014 and has been growing rapidly ever since. I had the opportunity to chat with Ryan Hatchett, the community's leasing manager. He expressed his enthusiasm about the state of the greater Orlando market and confessed "I really love being part of Lake Mary." He argued that the success of the community is an excellent reflection of the Orlando area's strong rental market.
Real Data Apartment Market Research anticipates that the vacancy rate will remain steady during the next 12 months and stay below the average in the Southeastern United States. Furthermore, Orlando's occupancy rate is poised to increase in conjunction with continued job growth in the area. As AAGO Public Affairs & Communications Manager Amanda Hoang explained, "As long as the local economy continues on this path, it is likely that occupancy rates will remain high."
AAGO attendees, its market panelists, and community managers alike find the greater Orlando area's current market trends and ongoing development encouraging and consider both a testament to the market's vitality and positive impact on residents.