New supply typically puts downward pressure on key CRE fundamentals, but in Columbus, Ohio’s multifamily market, Colliers’ first quarter report expects new developments to at least drive rents higher.
This year the city is projected to deliver 7,400 units, representing almost a 40 percent leap from last year. After that, the pace will continue to slow down. For example, Colliers forecasts that 28 percent less product will hit the market next year, with that number falling to an average of 12 percent annually compared with 2025 projected levels between 2027 and 2029.
"As Columbus' growth accelerates with major economic development projects starting to deliver, it's anticipated that this will drive rent growth above current expectations," Colliers wrote.
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"Developers are concentrating on strategically located sites near job hubs and transit, with a notable focus on suburban submarkets that offer more affordable land and growing populations."
By submarkets, Downtown & German Village has the largest share of units in the pipeline, 16.55 percent of the total. North Columbus and Hilliard follow, at 13.37 percent and 11.58 percent, respectively.
In the first quarter, rents grew 2.6 percent year-over-year to an average of $1,379. East Columbus led all submarkets in percentage gains, thanks to its 5.1 percent growth. However, Colliers did not reveal precisely how much the rent will grow.
By property type, Class A's in newer developments maintained the strongest pricing power, according to Colliers. Meanwhile, Classes B and C were more competitive for leasing.
In Columbus' multifamily sector, even with lingering economic concerns regarding tariffs and inflation, Colliers said that developers remain "engaged with strategic long-term project planning throughout the MSA."
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