Newer Multifamily Buildings Faring Better

Von Stroh's report found that multifamily buildings with 51 to 99 units had the highest vacancy at 11.1%, little change from the first quarter. Lowest vacancies are in buildings with 200 to 349 units at 9.2%, down from 10.4% in the first quarter. And buildings with 350 or more units had a 10.1% vacancy rate, down a full point from the previous quarter.

"Historically, larger buildings have the highest vacancy rates," Von Stroh notes. This is a sign that owners are doing whatever they can to retain tenants, notes Mark Williams, executive director of the Apartment Association of Metro Denver.

Data from Von Stroh's report further backs that up. Buildings constructed from 1995 to 1999 had a 7.6% vacancy rate, down from 8.7% for the first quarter. And buildings constructed between 1990 and 1994 had a vacancy rate of 6.2%, down from 7.9% in the first quarter. Buildings constructed between 1940 and 1949 had the highest vacancy rate at 15.4%, more than double the 7.2% vacancy rate in the first quarter, a sign that renters are taking advantage of discounts at newer buildings and moving.

In addition, Von Stroh's reports shows tenants are seeking larger apartment units. Apartments units smaller than 500 sf had the highest vacancy rate at 10.7%. Those with 500 sf to 749 sf had a 9.5% vacancy rate, while those 750 sf to 999 sf had a 9.3% vacancy rate. Units with more than 1,000 sf, however, were back in double-digit vacancies at 10.6%.

The vacancy rate for efficiency apartments stands at 11.8%; one-bedrooms at 8.8%; two-bedroom, one baths at 10.4%; two-bedroom, two bath units at 10.1%; and three-bedroom units at 12.2%. As previously reported by Globest.com, the overall apartment vacancy rates is 9.7%, down from 10.5% in the first quarter.