Suburbs May Excel CBDs in Apt. Metrics

CHARLOTTESVILLE, VA—Urban multifamily is hardly losing its edge, but lately the industry has gotten the memo that being in the suburbs is no bad thing. A panel of experts at last week’s National Multifamily Housing Council 2015 Apartment Strategies Outlook Conference elaborated on the premise that development outside the urban core is in fact thriving, contrary to widespread perceptions, and SNL Financial charted similar territory in a recent report on multifamily REIT activity.

“The suburban thesis, and the fundamentals driving it, came into sharper relief in October when executives at a blue-chip apartment REIT, AvalonBay Communities Inc., said the company would shift its development emphasis toward the suburbs, partly as a result of rent-growth trends and new supply in the cities,” according to the SNL analysis under the byline of Jake Mooney. While AVB was not likely to walk away from its urban development already in progress, executives’ comments during the REIT’s third-quarter conference call underscored the point that “there is still money to be made in the land of low-rises.”