Over the last 10 years, there were record multifamily deliveries — about 3.5 million completed units, according to RealPage Market Analytics. That was a 21% jump over the decade.
And, according to a new RealPage analysis, commuter submarkets for major metros have seen some of the biggest multifamily completion volumes in the country, with Manhattan’s commuter submarkets a remarkable example.
There are 997 submarkets, by RealPage’s county, across the largest 150 apartment markets. Out of the submarkets, 13 saw inventory increases by at least 17,000 units.
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Take Manhattan as the pinnacle example. Brooklyn (35,890 units and 7.9% total inventory growth), Jersey City (27,813 units, 52.2% inventory growth), and Queens (22,960 units, 8.8% inventory growth) were numbers 1, 2, and 4 out of the top 13 biggest supply volume submarkets between 2014 and 2024.
The other entries were Dallas submarkets Frisco (26,618, 238.3%) and Allen/McKinney (22,438, 133.5%); Nashville’s Central Nashville (21,723, 168.5%), LA’s Downtown Los Angeles (19,919, 51.6%); The Loop in Chicago (19,331, 78.5%); East Austin (18,133, 155.0%) and Round Rock/Georgetown (17,838, 124.7%) for Austin; Phoenix and Avondale (17,749, 139.4%); Philadelphia’s Center City Philadelphia (17,368, 52.2%); and Northeast Denver (17,322, 114.0%) for Denver.
Data from New York City say that more than 880,000 people regularly commute from the other four boroughs into Manhattan with another 540,000 coming from outside the city joining the 628,000 workers who already live in Manhattan. No wonder the city is usually a bustling multifamily development spot.
However, relative rankings have shifted over the last 10 years. New York fell to number 6 with South regional markets of Dallas, Houston, Austin, Atlanta, and Washington, D.C. pulling ahead. Even so, between 2014 and 2024, New York received about 108,300 new multifamily units with a third going to Brooklyn and 21% to Queens.
Part of the increase everywhere was monetary policy that started after the Great Financial Crisis. The Federal Reserve sharply cut interest rates, making new CRE investments, including in multifamily, more financially attractive. When the pandemic hit, the Fed dropped rates even more and pushed on creating liquidity to keep the economy working.
With the advent of extensive work-from-home and hybrid policies, as RealPage noted, many people found it economically beneficial to rent outside of Manhattan and other major metros and commute in less frequently. And New York felt the impact.
Rents in Brooklyn even as of February 2024 were $4,710, which was $470 less than the Financial District, Manhattan’s most affordable submarket. Queens, which saw an 8.8% increase in the unit base, offered $1,500 in savings over the cheapest Manhattan rents. With the additional base of 52.2%, Jersey City provided equivalent savings as Queens.
The savings dynamic for a new world of office work is the same elsewhere, if not to the same financial degree. Center City Philadelphia saw an additional 52.2% in units. Not only did that provide an extension to Philadelphia itself, but anyone willing to occasionally make the two-hour drive to Manhattan would save $2,600 compared to rents in the Financial District, putting them at around $2,580.
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