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Slowing Rent Growth Not Setting Off Alarms

SAN FRANCISCO—Albeit at a slower pace, there is still positive rent growth in some markets, wages continue to grow, national unemployment is less than 5% and the millennial population continues to rent.

Guy Hays Legacy Hays says capital is available for well-located projects meeting target risk-adjusted returns.

SAN FRANCISCO—The Bay Area has a strong economy and an attractive lifestyle that continues to drive in-migration. While some cities have been able to absorb new supply better than others, decelerating rents have been a trend overall, such as in San Francisco and Denver, two metros that had significant supply increases in 2016.

Rents began decelerating nationally in the second half of 2016 and a report by Yardi Matrix indicates that trend continuing into 2017. One reason is the mismatch between demand and supply, which is already producing a slowdown in high-rent markets.

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Lisa Brown

Lisa Brown

Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.

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