While the apartment sector has withstood the COVID-19 pandemic reasonably well due to federal stimulus payments and expanded unemployment benefits, problems could be on the horizon for multifamily assets, according to Fitch Ratings.
Fitch says that US apartment REITs with high exposure to class B and C assets and properties in gateway cities are vulnerable to the economic fallout of the coronavirus pandemic due to the risk of urban flight and high job losses among lower-income households.
Fitch cites Federal Reserve data showing that job losses are highest among lower-income households. Others are seeing that same trend. "Low-income workers feel little financial stability," CoStar Advisory Services Consultant Joseph Biasi told GlobeSt in an earlier interview. "You can see that with those making less than $75,000."
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Leslie Shaver
Les Shaver has been covering commercial and residential real estate for almost 20 years. His work has appeared in Multifamily Executive, Builder, units, Arlington Magazine in addition to GlobeSt.com and Real Estate Forum.
