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RealFacts Reports Rents Log Uptick in West, South -- First Since 2008
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RealFacts Reports Rents Log Uptick in West, South -- First Since 2008
Industry News
U.S. Vacant Housing Hits Record 19 Million
Downtown Apartments Filling Up
Mid-America Apartment Communities' Revenues Better Than Expected
Apartment Rental Rates in Las Vegas Climb as Jobs Market Improves
What to Do If Your Boss Is the Problem
Legislative/Legal News
L.A. Councilman Calls for One-year Moratorium on Rent Hikes
Calif. Ruling Says Owners Don't Have to Accept Section 8 Residents
Illinois City May Consider Tougher Restrictions on Apt Owners, Residents
Deal Is Reached, Averting Doormen's Strike in New York
Washington State Program Aims to Foster Community Within Apartment Communities
NYC Apartment Residents in Defaulted Properties Demand Fixes
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RealFacts Reports Rents Log Uptick in West, South -- First Since 2008
Digested From "Rents Log Uptick in West, South; First Since 2008"
Denver Post (CO) (04/25/10) by Daniel Taub
RealFacts reports that apartment rents rose throughout the West and South in the first three months of this year for the first time since 2008 as a drop in the U.S. unemployment rate from a two-decade high helped tenants pay more for housing. In fact, RealFacts reports that 36 of 41 metropolitan statistical areas showed an increase in rents in the first quarter. The average asking rent rose to $943 a month from $932 in the fourth quarter, according to the RealFacts report. The firm surveyed owners of more than 12,700 apartment communities for its findings.
Industry News
U.S. Vacant Housing Hits Record 19 Million
Digested From "U.S. Vacant Housing Hits Record 19 Million"
MarketWatch (04/26/10) by Rex Nutting
The Commerce Department reports that the number of vacant housing units in the United States rose to a record 19 million in the first quarter, an increase from 18.9 million in the last three months of 2009. In total, about 14.5 percent of homes were vacant, with 4.4 million available to be rented and 2 million available to be sold. Meanwhile, the vacancy rate for rentable units slipped from 10.7 percent to 10.6 percent over that same time span. The housing inventory climbed by 1.14 million to 130.9 million in the past year. Also during that time, occupied homes increased by 1.07 million to 111.9 million.
Downtown Apartments Filling Up
Digested From "Downtown Apartments Filling Up"
Pittsburgh Post-Gazette (04/22/10) by Mark Belko
The speed at which downtown Pittsburgh apartment units have leased suggests a strong demand for Downtown apartments with moderate rental rates. Rates average $718 to $1,370 a month at the Century Building on Seventh Street, which leased all 60 of its studio, one- and two-bedroom apartments over three months last year, though some income-restricted units lease for as low as $565 a month. "I would believe I could fill three more Century buildings if I had the right property and could deliver the right price," says Bill Gatti, president of Trek Development Group, owner and developer of the property. Patty Burk, Pittsburgh Downtown Partnership vice president of housing and economic development, says projects such as the Century Building are an "indication of demand for Downtown living." At the end of 2009, apartments in the greater Downtown area that includes the North Shore and Strip District had a 93 percent occupancy rate, she says.
Mid-America Apartment Communities' Revenues Better Than Expected
Digested From "Mid-America Apartment Communities Revenues Better Than Expected"
Memphis Commercial Appeal (TN) (04/22/10)
Mid-America Apartment Communities Inc. reports that it expects its first-quarter 2010 Funds from Operations (FFO) to exceed its prior guidance. Based on preliminary results, Mid-America expects to report FFO between $30.1 million and $31.6 million for the first quarter of 2010. Net income available to common shareholders is expected to be between $5.3 million and $6.7 million, representing a range of $0.18 to $0.23 per diluted share for the same period. Mid-America CFO Al Campbell states, "Same-store property operating performance was better than our forecast due to solid occupancy, strong collections performance, and better than anticipated fee income. Interest expense was also slightly better than expected due to the continued favorable rate environment."
Apartment Rental Rates in Las Vegas Climb as Jobs Market Improves
Digested From "Apartment Rental Rates Climb as Jobs Market Improves"
Las Vegas Review-Journal (04/21/10) by Hubble Smith
RealFacts reports that apartment rents in Las Vegas increased slightly, with average rent climbing 0.9 percent from the previous period to $775 a month, though it's still down 10.4 percent from $865 a year ago. RealFacts' survey of apartment communities with 100 or more units put the national average rent at $943, up from $932 in the fourth quarter. Sarah Bridge of RealFacts notes the outlook for apartments in December was "grim," highlighting the speed in the improvement of rental housing fundamentals. "The reason rents are on the rise after five consecutive quarters of decline is due to a modest increase in the rate of employment and new jobs being created in many markets," she says. "That said, Las Vegas is one of the markets hardest hit by the current economic downturn." She adds that occupancy rates haven't rebounded as quickly as rental rates, but stabilization has been firmly established early in the year, with Fresno, Calif., among the most promising markets, gaining 2.4 percentage points in first-quarter occupancy to 92.5 percent. Average occupancy in Las Vegas improved to 90.5 percent during the quarter, up 0.4 percentage points from the fourth quarter, and down from 91.2 percent a year ago. Spence Ballif, apartment specialist with CB Richard Ellis in Las Vegas, points out apartments are competing with a flood of single-family rental homes on the market.
What to Do If Your Boss Is the Problem
Digested From "What to Do If Your Boss Is the Problem"
Wall Street Journal (04/20/10) by Dennis Nishi
Staffing firm Robert Half International notes a bad boss is the most common reason employees quit their jobs. A 2009 survey of workers by the Workplace Bullying Institute found that 27.5 percent of respondents reported that ill treatment by superiors got worse after the financial crisis started. The author of this "Career Strategies" column gives advice on dealing with a difficult supervisor. Workplace conflict resolution officials recommend that an employee not immediately react to a disagreement with the boss, in order to cool down and to conduct an honest self-assessment. Coworkers and personal friends should be questioned for some outside perspective. "If you're still thinking about it after two days, it's probably important enough to require resolution," says Richard Hart, director at ProActive ReSolutions Inc. The employee should then document recent incidents of abuse, arguments, and anything else that falls outside of a normal employee/management relationship. Hart also highlights the importance of trying to engage in a productive conversation with the supervisor. "Have a regular conversation and focus on the problem and not the incident," he says. "Whatever you do, don't be confrontational," he says. "Be ready for the fact that the conversation may not go well." Employees can also consider finding allies who may be able to approach the problem boss as a peer or offer perspective about the behavior that could temper the issue. A company's human-resources department is also a potential place to obtain guidance and specific advice. No matter how the situation is resolved, employees should focus on doing their job well and minimizing conflict. If nothing else works, they should consider asking for a transfer to another department instead of quitting precipitously.
Legislative/Legal News
L.A. Councilman Calls for One-year Moratorium on Rent Hikes
Digested From "L.A. Councilman Calls for One-year Moratorium on Rent Hikes"
Los Angeles Times (04/14/10) by David Zahniser
Los Angeles City Councilman Richard Alarcon is sponsoring a measure that would impose a one-year moratorium on rent increases for more than 600,000 apartments across the city, noting the impact of the recession on families living in those buildings. Alarcon says passage of his proposal would prevent apartment owners from imposing the 3 percent rent increase that would be allowed on July 1 under the city's rent stabilization ordinance. Alarcon notes that for renters who do not pay electricity and gas bills, rent could increase by as much as 5 percent, and calls on his colleagues to support his moratorium since they have been speaking out against Mayor Antonio Villaraigosa's plan for four consecutive electric increases at the Department of Water and Power. "If they block the increase in DWP rates, then they should block this [rent] increase," he says. The Valley Industry and Commerce Association has expressed opposition to Alarcon's call for a rent moratorium. "Los Angeles already places an unreasonable number of regulations on business owners," says Edgar Khalatian, chairman of the group's land-use committee. "This is yet another unfair burden on property owners who are struggling to avoid foreclosure proceedings."
Calif. Ruling Says Owners Don't Have to Accept Section 8 Residents
Digested From "Ruling: Landlords Don't Have to Accept Section 8 Tenants"
Santa Monica Daily Press (CA) (04/12/10) by Kevin Herrera
In California, a state appellate court ruled recently that apartment owners have the right to not accept Section 8 vouchers from low-income residents. The ruling stems from a case involving an elderly Santa Monica widow, who attempted to use her Section 8 voucher to remain in an apartment owned by Los Angeles Clippers' owner Donald Sterling, who recently agreed to pay nearly $3 million after settling a housing discrimination lawsuit brought by the U.S. government. "This is a fairly significant case," for owners, said attorney Karen K. McCay with the law firm of Pahl & McCay, which joined the case on behalf of the California Apartment Association. "While we are a big supporter of the Section 8 program, it does have some restrictions on property owners. It should be voluntary. That was how it was designed." In recent years, though, debate has intensified over whether or not a housing owner's decision to not accept Section 8 vouchers, and therefore not rent to low-income tenants, is an act of discrimination. Under the state Fair Employment and Housing Act, owners are prohibited from discriminating based on a person's source of income along with their race, religion or sexual orientation.
Illinois City May Consider Tougher Restrictions on Apt Owners, Residents
Digested From "City May Consider Tougher Restrictions on Landlords, Tenants"
Belleville News-Democrat (IL) (04/21/10) by Chris Orlet
Highland, Ill., city administrators recently met with the owner of the Elkay apartment community to address concerns related to building quality and residents' safety in response to the ongoing criminal problems that the complex has been experiencing lately, and the results of that meeting were described as positive. City officials say the owner had agreed to take steps to rectify the ongoing criminal problems associated with his apartment building. Earlier this month residents from the Lynn Street neighborhood showed up at the City Council to voice their outrage over the increasing incidents of vandalism, break-ins, and theft which they associate with some of the apartment’s residents. The landlord said he hoped to find a property manager that he could trust, says city attorney Harold Belsheim, and meanwhile, neighborhood watch signs will go up this week. Belsheim says it is essential the city pass ordinances that will prevent transients from taking up temporary residence in Highland. Police Chief Terry Bell says much of the problem stems from visitors who are staying temporarily at the apartments, noting that other communities have tough ordinances which force the criminal element to look for less restrictive towns, which is what brings them here. He says the restrictions could require background checks of would-be tenants to occupancy permits and property inspections. Belsheim says another option the city has is to impose a fee on property owners to reimburse the city for inspections.
Deal Is Reached, Averting Doormen's Strike in New York
Digested From "Deal Is Reached, Averting Doormen's Strike"
New York Times (04/21/10) by Patrick McGeehan
Last week, the owners of more than 3,200 apartment buildings in New York City reached an agreement on a new labor contract with the union that represents about 30,000 doormen, porters, janitors and building superintendents, averting a strike that was to begin on April 21. The four-year contract includes a total pay increase of more than 8 percent and no significant cuts in benefits for the workers. The main points of contention in the talks were the owners' demand that the workers shoulder part of the cost of their health care, and the size of a pay raise for the next few years. The owners argued that the recession that began more than two years ago had crimped their ability to be as generous. They cited increased property taxes and utility costs as reasons for demanding concessions on benefits.
Washington State Program Aims to Foster Community Within Apartment Communities
Digested From "Program in Lynnwood Looks to Foster Community Within Apartment Complexes"
Everett Daily Herald (WA) (04/23/10) by Karen Law
Lynnwood, Wash.-based Community Northwest aims to help property managers create a sense of community that can give apartment residents a sense of satisfaction in the quality of their life while dwelling in the apartment. The nonprofit organization has been placing hospitality teams at area complexes since 2005. “When we introduce our program, most property managers think it is a good idea but aren't sure whether it's necessary,” says Kimberly Lee, Community Northwest's human resources director. "Most have tried community building through using their own staff, but typically there is no support or training for this, and the staff already has the primary job of managing and renting the property." When an apartment community signs up with Community Northwest, an on-site hospitality team connects with residents and can organize meals, emergency transportation, shopping runs, and more. The team works closely with the management staff, analyzing demographics and creating a customized program to enhance community life for the entire complex. "It's transitory living," Lee says. "You have to think of strategic ways to be more effective more quickly." Community Northwest is modeled upon the CARES Program, a resident-retention plan created by Dallas-based Apartment Life. A CARES Program financial-impact analysis indicated that participation in the program added approximately $138,000 in annual financial benefits to the average community.
NYC Apartment Residents in Defaulted Properties Demand Fixes
Digested From "NYC Tenants in Defaulted Properties Demand Fixes"
Associated Press (04/22/10) by Samantha Gross
In the wake of the national housing collapse, some buildings have fallen into default where residents have watched the owners walk away, leaving it uncertain who has the responsibility to maintain the facilities. Multifamily mortgages covering 340,000 U.S. apartments and worth an estimated $28.8 billion were delinquent or in foreclosure at the end of 2009, according to research and consulting firm Real Capital Analytics. In New York City, more than 25,000 rent-stabilized apartments have deteriorated visibly since the beginning of the downturn, city housing officials said earlier this year. On April 21, residents at 10 Bronx buildings once managed by Milbank Real Estate filed court papers to demand that those connected to their apartment owner's failed mortgage step in to repair more than 4,400 housing violations in 548 apartment units. The court papers filed Wednesday name Wells Fargo bank, which is the trustee, or administrator, for the commercial mortgage-backed security that includes the failed loan on the buildings. They also name LNR Partners, the special servicer appointed to handle the properties. Wells Fargo spokeswoman Elise Wilkinson says that while the bank is the administrator for the investors who own the failed loan, it does not own or control the mortgage. She says that usually the special servicer, LNR Partners, would be responsible for apartment repairs.
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