 For the second time in four months North Carolina-based Bell Partners Inc., bought a large apartment property in Redmond, and the deal looks similar to the company's first Seattle-area acquisition.
Bell paid Trammell Crow Residential $91.6 million for the new 222-unit property at 6335 180th Place NE. That's four miles northeast of another new property that Bell bought for $96 million in September. The most recent acquisition has been renamed Bell Marymoor Park, and it's 94 percent leased, according to Bell. The company said market-rate units are renting for about $2.75 per square foot. Bell is among investors banking heavily on the Seattle-area apartment market. Rise Properties Trust spent about $588 million last year buying nine apartment properties in the region, where rents are rising thanks to continued growth of tech companies. Amazon is entering Redmond, joining Facebook, Google, and Microsoft. While still going up, Redmond's rent growth has weakened due to a significant boost in new inventory. After increasing 3.9 percent between and third quarter of 2018 and the first quarter of 2019, Redmond's rent growth slowed to about 0.7 percent from March to September 2019, according to Commercial Analytics, a Seattle company that tracks the multifamily market. During those six months, rents increased nearly 1.5 percent across the Eastside and about 1.2 percent in Seattle. Commercial Analytics reported that Redmond added 1,281 new apartment units over the last two years, with another 2,120 under construction. King County has added more than 14,000 units since 2018, and 13,380 new units are being built this year. Bell Executive Vice President of Investments Nickolay Bochilo said the Eastside, with its high-quality schools, rapidly expanding tech companies, high cost of buying versus renting and "differentiated lifestyle amenities" support attractive fundamentals for rental housing.
The rate of apartment rent growth across the four-county metro Puget Sound region area is neither super high or super low, and the vacancy rate is similarly on an even keel.
That's according to Seattle company Commercial Analytics' report, which found that the vacancy rate in March was 2.75 percent while rents grew by 2.28 percent over the preceding six months. During the height of the boom rents were much lower and rent growth was off the charts. "The market is fundamentally in equilibrium. I haven't seen that since the crash," said appraiser Brian O'Connor of O'Connor Consulting Group, a Commercial Analytics co-founder. "It's like we are in this Goldilocks moment." The results varied by county, with rent growth ranging from 1.6 percent in Snohomish, for all sizes of apartments. One bedrooms there rented for an average of $1,379. Overall rents rose 8 percent in Kitsap, where the average rent for one bedrooms was $1,336. King County rents increased 2.2 percent for all sized apartments, with the average one-bedroom rent at $1,873. There was a 2.3 percent rent increase in Pierce County, where the average one-bedroom rent was $1,190. The Eastside showed a much stronger pattern of rent growth than any other King County submarket, with an increase of 4.1 percent versus 1.35 percent in Seattle. "The Seattle market is clearly beginning to show signs of the significant new supply of units," O'Connor wrote in the report. Rent growth in downtown, South Lake Union and Belltown was 1.35 percent. Most everywhere in Seattle, rent growth was under 2 percent, with the University District and Northeast Seattle seeing a gain of nearly 1.1 percent. The lone exception was 4.4 percent in West Seattle. Developers continue to build. Region-wide, 15,500 apartment units are under construction, up 10.3 percent, according to Commercial Analytics. Four-fifths of the units are going up in King and Snohomish counties, and two Vancouver, Canada companies, Onni Group and Westbank, lead the way with a total of 2,300 units. Developers are homing in on sites around transit stops, and they're becoming more and more loath to building in Seattle with the city's higher "mandatory affordable housing," or MHA fees compared to other cities. O'Connor, who advises developers, said builders have taken a shine to Shoreline. Ask why, and "the first words out of their mouths are no MHA fees," he said.  Commercial Analytics has released its inaugural apartment market data report. Team members are (left to right) Taylor Odegard, Brian O'Connor, Jim Bowles, Russ Johnson and Candice Chevalier. Photo: Anthony Bolante, PSBJ  A report by a new Seattle company contains a big surprise: Seattle apartment landlords have not suffered from the new-supply glut as had been anticipated. Commercial Analytics' inaugural report fills the void of locally sourced market data left after the unexpected closure of Dupre + Scott Apartment Advisors in December 2017. The Seattle company closed after 38 years of publishing the gold standard of market intel used by industry players from developers to public policy makers. In downtown Seattle and South Lake Union, where some observers have been anxious over the addition of thousands of new units in recent years, the year-over-year vacancy rate ticked up about a point to 5.1 percent in September. The average rent increased 5.4 percent to $2,140. The 2017 data was from Dupre + Scott while Commercial Analytics gathered the 2018 numbers. "The apartment market has remained pretty healthy," said appraiser Brian O'Connor of O'Connor Consulting Group. He and brokers Candice Chevaillier of SVN Whitecap and Jim Bowles of Lee & Associates co-founded Commercial Analytics in partnership with Seattle tech company NavigatorCRE. What sets Commercial Analytics apart from national apartment market data companies is that the new firm, like Dupre + Scott, drills down by neighborhood, unit type and year built. The company's coverage area includes all four metro counties. It is a cloud-based service that crowdsources market information to provide fine-grain detail. In-house staff verifies data with landlords. Commercial Analytics will release data about landlord concessions in its forthcoming development report, but the firm's January survey found that 28 percent of properties across the region offered free rent and other concessions, while in Seattle the number was 30 percent. Among Commercial Analytics' upcoming offerings will be reports on apartment buildings' expenses, sales and investment activity and the condominium market. The report costs $695 a year for the spring and fall rent-and-vacancy report, plus a $95 membership fee. It comes with a copy of a supplemental report called Data Junkie that analyzes market fluctuations and offers forecasts, which is penned by O'Connor. O'Connor wrote that King County's slowdown in 2017 was, in part, due to slower regional job growth, which subsequently rebounded. Given that employment growth is expected to slow this year to perhaps 40,000 jobs, down from 53,000 last year, it seems reasonable to expect lower demand and rising vacancies, he said.  September 28, 2018 09:00 AM Eastern Daylight Time
SEATTLE--(BUSINESS WIRE)--In December of 2017, Dupre + Scott closed its doors and left a void in the greater Seattle market for apartment research. They were a trusted resource for the last 38 years to a diverse group of stakeholders that relied on that information: Institutional Lenders, City and County Housing Authorities and governmental entities, the University of Washington, major Developers, and the entire Commercial Real Estate brokerage community. Commercial Analytics has been formed by several key industry professionals including: Brian O’Connor, MAI, CRE, of O’Connor Consulting Group, Candice Chevaillier of SVN Whitecap and Jim Bowles of Lee & Associates to replace and evolve this critical source of commercial real estate research. Commercial Analytics has partnered with NavigatorCRE to provide research analytics for commercial real estate industry in the state of Washington. Initial offerings will include Multifamily research reports and analytics related to: Rent, Vacancy, Expense, Investment Sales and Development, serving the Tri-County Area (King, Pierce, Snohomish) as well as Kitsap and Thurston counties. The CA platform is built on NavigatorCRE, which is a Software as a Service (SaaS) product, custom built for the Commercial Real Estate (CRE) industry with proprietary technology that efficiently uploads, stores, filters and reports on data. NavigatorCRE is built and hosted on Microsoft’s Azure infrastructure, which allows data to be private, secure, and encrypted. The system streamlines the ability for owners, brokers and property managers to contribute data without sacrificing privacy. Further, it allows users to dynamically view a full spectrum of aggregated market analytics to enhance decision-making. The Commercial Analytics team believes that when accurate commercial property data is widely available, it benefits all of those involved. With better information, owners, property management companies, developers and policymakers alike can make better decisions, drive operational efficiencies and investment value, create well-conceived public policy, and better serve our community of residents. Contacts For Press Inquiries: Commercial Analytics Candice Chevaillier candice@commercial-analytics.com
Sep 27, 2018, 10:43am PDT Dupre + Scott Apartment Advisors roiled the Puget Sound real estate industry when it said it was closing permanently at the end of last year. The company had been the gold standard of market intel for apartment developers, landlords, brokers and public policymakers for 38 years. Who would replace the resource with Patty Dupre and Mike Scott retiring? The answer emerged this week. Veteran Seattle real estate executives Jim Bowles, Candice Chevaillier and Brian O'Connor unveiled their new research service, Commercial Analytics, which is partnering with NavigatorCRE, a Seattle tech company that aggregates, analyzes and animates data. “Everyone I knew used and valued Mike and Patty and their information,” said Chevaillier. “So many people need and want the information.” Unlike out-of-town data companies that merely harvest online data, Dupre + Scott surveyed apartment owners and managers. The pair turned the data into reports, but didn’t disclose the health of individual apartment companies and buildings and decided not to sell their company to protect the information they had collected from landlords. Time was of the essence. Dupre + Scott’s closure was going to leave a hole in decades of rent, vacancy and operating expense data as well as the development pipeline and sale comps. “Candice really rallied us and said, ‘OK, what do we do about this gap?’” said Bowles. The question was who had the skills and heft to close it. Bowles had worked with NavigatorCRE Chairman and Chief Innovation Officer Taylor Odegard at CBRE when Bowles was CBRE's Seattle-area market leader, so he knew NavigatorCRE was creating the platform that would work. “It’s about trust,” said NavigatorCRE CEO Russ Johnson, who co-founded his company with Odegard and financial backing from Goodman Real Estate of Seattle. “This is a neutral, high-trust single repository with the understanding that out of that will come business analytics that don’t sacrifice privacy.” NavigatorCRE’s tech savvy, Chevaillier’s passion for the project and O’Connor’s decades of experience were among “a whole bunch of stars that lined up,” Bowles said. CA allows apartment owners and managers to contribute data. Contributors and subscribers will receive reports in print and digital formats. Subscriptions will be similar to what Dupre + Scott charged, Chevaillier said, though rates will be commensurate with what CA offers. “(The market) has never seen what we are about to deliver – daily, instantaneous, live data access,” Johnson said. “People that know Navigator look at this as the old Dupre + Scott on steroids.” Commercial Analytics
 Marc Stiles
Staff Writer Puget Sound Business Journal |
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