Multifamily Sector Finds its Mojo Again

Cooke says Tucson’s downtown area is transitioning to a true urban feel with a live, work play environment.

TUCSON, AZ—The Tucson multifamily market strengthened to end last year, due in large part to a local labor market that gained momentum in the second half of the year. Until the third quarter, local employers had been slow to expand payrolls, even as the national economy gained momentum. That pattern changed course beginning in the third quarter and employment growth accelerated in the final three months of the year, according to a report by Colliers International.  

Cindy Cooke, senior executive vice president at Colliers International, tells GlobeSt.com: “Several indicators are pointing to a Tucson market recovery which has been much longer in coming than previously anticipated. Job growth is on the upswing, the downtown area is transitioning to a true urban high energy feel with a live, work play environment, and the multifamily supply and demand is now more closely aligned reflecting a downward trend on vacancy. Tucson is one of the few multifamily markets in the country with cap rates over 6% and as high as 7% in some cases and sale prices are so significantly below replacement cost. Tucson offers investors a great opportunity to buy in a recovering market where multifamily investments are priced to capture solid cash flows and provide excellent future value add opportunities.”