Low-Income Rental Market Contracts
Digested From "Low-Income Rental Market Contracts"
Wall Street Journal (06/26/13) Whelan, Robbie
According to an annual study by Harvard University's Joint Center for Housing Studies released this past week, low-income rental households are facing increasingly difficult prospects when looking for places to live due to the harsh reality that more people are falling into poverty. At the same time, budget woes are cutting into the supply of government-subsidized housing. Between 2007 and 2011, the number of extremely low-income renters -- those earning 30 percent or less of the median income in their communities -- climbed by 2.5 million to 12.1 million. During the same time span, the number of rental units affordable to this demographic declreased 6.9 million to 6.8 million. This, in turn, doubled the gap between the number who need low-income housing and the supply of such residences. Additionally, the number of households that are "severely burdened" -- i.e. those who spend over 50 percent of their incomes on housing -- topped an all-time high of 20.6 million in 2011. That was a 14.6 percent increase since 2007 and a gain of 49 percent over the previous decade. Eric Belsky, an economist and managing director of the Joint Center, comments, "It's pretty dispiriting. When you're spending that much on housing, there are all these things you're not spending money on, in grocery stores, on clothing, on entertainment, on health care."
Market Trend Insights
Why Are Philadelphia Planners Surveying Those Who Rent?
Digested From "Why Philadelphia City Planners Are Surveying City Renters"
Philly.com (06/28/13) Gates, Kellie P.
Philadelphia city planners have come to the conclusion that they do not know enough about those who rent and the rental experience in the city. To that end, they have launched a survey to find out more details. According to City Planner Octavia N. Howell, there has been a real lack of information when compiling data on existing neighborhood conditions for the district-level comprehensive plans. While many urban planners believe that those who rent housing are a transient population, others insist that people are choosing to rent as an alternative to homeownership. The survey, which runs through mid-July, asks apartment residents and others not only why they rent and what their experiences have been like, but whether they find renting in Philadelphia affordable. City Planning is also reaching out to apartment owners for their thoughts and opinions. Howell said survey results will not be used to change goals of the handful of district plans that are already finished, but they will inform future district plans.
Three Factors That Will Limit Single-Family Rental Homes
Digested From "U.S. Rental Demand Remains Strong"
NuWire Investor (06/25/13) Bharatwaj, Shanthi
While it is less expensive to buy than rent in nearly every major metropolitan area, rental demand remains steady. This has prompted Blackstone and other institutional investors to invest billions in converting foreclosed homes into rentals. Moving forward, though, supply of single-family rental homes may be limited by three factors -- fewer distressed homes, high overheads, and potential exits from large investors as yields shrink. Many new households, hampered by student debt and limited access to credit, will have no choice but to rent. So demand will definitely remain solid for a while.
List of Crime-Free Apartment Communities Grows in Calif.
Digested From "List of Crime-Free Apartment Communities Grows"
Fallbrook Village News (06/20/13) Ramsey, Debbie
A growing number of apartment communities in Fallbrook, Calif., have been keeping their properties crime-free. "We are pleased to report we now have 18 certified Crime Free Multi-Housing communities in Fallbrook," said Sheriff's Lt. Todd Richardson. "The program has been a great success in our area and the apartments who have enrolled in it have reduced their vacancies and improved the quality of life for their tenants, their neighbors and our community at large." The latest additions to the crime-free list are Autumn Haze Apartments and De Luz Senior Apartments. Richardson said 32 percent of apartments in the Fallbrook jurisdiction are now on the crime-free list, indicating significant progress at reducing wrongdoing.
Deals and Transactions
Two Reasons Behind Boston Firm's Big Alabama Apartment Buy
Digested From "$98 Million Deal Inked for Five Mobile Apartment Complexes"
NBC 15 (Alabama) (06/27/13) Singleton, Darwin
Colony Hills Capitol is investing nearly $100 million into the apartment sector of Mobile, Ala. A company representative said Mobile's changing economy and the new Airbus assembly plant are the two main reasons behind the big-dollar investment. The Boston-based investment firm is buying five apartment communities in all as part of a deal with locally based Delaney Development. The $98 million transaction includes more than 2,000 apartments citywide in such communities as the Pathways, Windsor Place, and Yester Oaks.
Upscale Apts to Be Part of Newport (Ohio) Revitalization
Digested From "More Luxury Apartments Coming to Newport"
Cincinnati Business Courier (06/25/13) Brownfield, Andy
A 102-unit upscale apartment community broke ground on June 26 in downtown Newport, Ohio. Dubbed Monmouth Row, it is being co-developed by Towne Properties and Carlisle Enterprises. "It's another piece of the puzzle in the revitalization of the area of downtown Newport," said City Planner Tom Fromme. The groundbreaking comes amid $80 million to $100 million in new and ongoing redevelopment in the downtown district. "It's pretty exciting to be truthful," Fromme said. "It's going to be a bright next couple of years."
There's No Place Like Maintenance Mania for This Kansas Man
Digested From "Wichita Maintenance Worker Wins National Contest"
Wichita Eagle (KS) (06/27/13) Riedl, Matt
Each year, apartment maintenance workers from all over the country compete in Mainteance Mania to determine who among them is the fastest at installing faucets, smoke detectors, and other home fixtures. At this year's event sponsored by the National Apartment Association, Wichita's Justin Heenan claimed the title. Heenan, who works for Key Management, won after six years of coming up short. Contestants first have to win one of the 10 regional competitions. After those are decided, 10 wild card picks are made to bring the championship draw to 20 competitors. The 2013 Maintenance Mania was held last week in San Diego. Heenan said he spent nearly eight months preparing for the event, practicing on near-scale models of the challenges constructed in his garage and basement. In addition to cutting his times, Heenan said he also lost weight for the competition, losing 53 pounds to "get lighter on my feet." The Apartment Association of Greater Wichita was able to send both Heenan and Aaron Adams, maintenance supervisor at Buttonwood Tree Apartments, to the contest. After edging the second-place finisher by 0.789 seconds, Heenan won two iPads, a washer and dryer, a custom-embroidered jacket, and a trophy. The prize package was worth more than $11,000. His total time for the eight events was 1 minute, 23.838 seconds.
NAA Names Ohio's Palmera Apartment Community of the Year
Digested From "Hills Apartment Complex Takes National Honor"
Cincinnati.com (OH) (06/27/13) Andrews, Cindi
The 360-unit Palmera in Mason, Ohio, has been named the 2013 Apartment Community of the Year by the National Apartment Association. Built last year by Hills Properties, the upscale development today has a waiting list for occupancy. Hills Properties senior vice president Rusty Lykes remarks, "Palmera represented a significant shift in our design and architecture while maintaining the same long-term approach to quality and service." Hills currently owns and manages over 5,300 apartments in five states -- Ohio, Indiana, Kentucky, Texas, and Massachusetts.
How Will One Manufacturer Turn Millennials on to Kitchen Appliances?
Digested From "Kitchen Appliances for 20-Somethings"
Wall Street Journal (06/25/13) Byron, Ellen
General Electric Co. is making plans to target millennials with a low-price, but high-design line of kitchen appliances. The company is hoping to hook these young adults early to build brand loyalty so that they will eventually trade up to pricier ovens, refrigerators, and dishwashers. GE has traditionally focused its appliance marketing and design efforts on consumers ages 45 to 60, who boast bigger bank accounts and fancier kitchens. However, the millennial generation -- which GE loosely defines as 20-somethings -- has become too big to ignore. Company research has shown that those in this demographic often ask their parents for advice on major purchases like appliances. Eddie Martin, chief marketing officer for GE Appliances, remarks, "As their moms and dads say that GE is a great brand to buy, we thought there should be a unique product that's targeted at them." Dubbed GE Artistry, the new line will be available in September and will include glossy black or white appliances with brushed stainless steel handles and accents. Together, the oven, refrigerator, microwave, and dishwasher cost roughly $2,400 -- among the least expensive appliances in GE's lineup.
Which Texas Market Is Hendricks-Berkadia Targeting?
Digested From "Multifamily Investment Firm Opens in Houston, Hires Top Execs"
The Houston Business Journal (06/25/13) Barr, Greg
Phoenix-based Hendricks-Berkadia has hired Chip Nash and Greg Austin to open a Houston office. Nash and Austin, who previously worked as managing directors in the Houston office of Jones Lang Lasalle, have closed $6 billion in multifamily housing sales in their combined 60 years in the business. They will work to increase apartment investment sales and mortgage banking services in the Houston market, which boasts a thriving multifamily market bolstered with new developments in west Houston and the Energy Corridor.
Who Is McCann Realty's New VP of Acquisitions?
Digested From "McCann Realty Hires Texas Based Vice President of Acquisitions"
McCann Realty Partners has named B. Todd Marney as its new Vice President of Acquisitions. His primary duties will include overseeing the firm's acquisition and related asset management activities in Texas focusing on such markets as Austin, Dallas/Ft. Worth, Houston, and San Antonio. MRP partners with institutional capital sources to buy, build, and operate apartment communities throughout the Southeast, Southwest, Mid-Atlantic and adjacent regions. The company focuses on acquiring both Class A and value-add apartment communities of 150 rental units or more in such markets. Since its founding, MRP has acquired 23 apartment communities containing more than 5,850 rental units in transactions valued at around $485 million. In addition, MRP has completed or has under development seven communities totaling 2,182 apartments with an estimated completed value of $240 million. Marney remarks, "I am very excited about this opportunity to join MRP and direct their acquisition program in Texas. We are currently looking at multiple opportunities in several Texas markets." For his part, Marney served as for Eliason Real Estate Group's senior vice president of acquisitions and asset management from 2005 to 2012.
Boston Tower Plan Revised to Include Apartments
Digested From "Simon Property Group Revises Back Bay Tower Plan"
Boston Business Journal (06/24/13) Grillo, Thomas
It has been seven months since the Simon Property Group put its condominium and retail tower at Copley Place in Boston on hold. Now, the Indiana-based REIT is back with a new proposal that replaces most of the condos with rental apartments. Under the revised plan, the $500 million development will still include 109 for-sale condos. But it will also offer 433 apartments in the 52-story skyscraper. The previous design was for a 47-story tower that would house 318 condos above four floors of retail space. It should be noted that the revised plan leaves the retail component unchanged. If approved, Simon would add almost 800,000 square feet to Copley Place. According to Simon officials, the increased number of residential units and floors will be accomplished through structural changes and by reconfiguring the interior space and floor plans.
Legal/Legislative Did You Know
L.A. Settles for $10 Million in Deutsche Bank Slumlord Lawsuit
Digested From "L.A. Settles for $10 Million in Deutsche Bank Slumlord Lawsuit"
Los Angeles Times (06/29/13) Bloomekatz, Ari
When attorneys for the city of Los Angeles took Deutsche Bank to court in 2011, they accused the world's fourth-biggest bank of being one of the city's worst slumlords and sought hundreds of millions of dollars in penalties and restitution. A settlement announced by L.A. officials late last week only delivered $10 million -- none of which will be paid directly by the bank. Under terms of the settlement, though, the bank does have to ensure that its foreclosed properties are properly maintained citywide. That could be a transformative move for some neighborhoods because the German bank foreclosed on more than 2,000 homes between 2007 and 2011 in such areas as the San Fernando Valley, South Los Angeles, and northeast L.A. The city had accused Deutsche Bank of allowing hundreds of its properties to fall into disrepair. This, in turn, resulted in increased crime. City lawyers also noted that some residents were illegally evicted. Deutsche Bank countered that prosecutors were going after "the wrong party." Spokesman John Gallagher said in a statement in 2011: "As we have repeatedly advised the Los Angeles city attorney's office, loan servicers, and not Deutsche Bank as trustee, are contractually responsible for both the maintenance of foreclosed properties and any actions taken with respect to tenants of foreclosed properties."
New Ariz. Law Protects Apt Residents in the Event of a Sale
Digested From "Apartment Owners Must Tell Residents of Foreclosures"
Associated Press (06/26/13)
Arizona Gov. Jan Brewer has signed into law a measure that requires apartment owners to provide written notice to residents within five business days of receiving a notice of trustee's sale. The law previously only required notice if a provision was in the lease. The law will give apartment residents peace of mind that they will not be surprised when their rental unit is repossessed by a bank. Rep. Steve Smith (R-Maricopa) says he sponsored the bill after apartment residents complained to his office that they were being tossed out of their homes by banks without notice.
It's Not A-OK for Some OK Residents in Need of an Ambulance
Digested From "Tulsa Apartment Residents May Not Be Covered For Ambulance Service"
NewsOn6.com (06/25/13) Bryan, Emory
The City of Tulsa is renewing its efforts to ensure people know whether or not they are covered for the cost of an ambulance ride. For homeowners, the extra charge is shown on their water bill. However, apartment residents may not know if the owner of their community has opted out of the program. The majority of apartment communities in the city are opting out of ambulance cost coverage, leaving their residents on their own to decide whether they should enroll in Tulsa's ambulance insurance program. For the first time, city officials are now requiring proof that apartment owners are sharing their decision on the matter with their residents. "And if they don't do it, the apartment owners, they will be fined," said Dwain Midget, with the City of Tulsa. "It's an $1,100 penalty for each [resident]."
Texas Apartments Crack Down With Curfew, But Is It Necessary?
Digested From "Meyerland Apartment Complex Institutes Strict New Curfew Policy"
ABC13 (Houston) (06/17/13) Barajas, Erik
Residents at an apartment community in Meyerland, Texas, are not happy over a strict, new curfew that requires them to be inside by 10 p.m. The Villages at Meyerland Apartments sent a letter to residents a couple of weeks ago to explain the new policy. "If you are outside in the parking lot or in any common areas you will be asked to go inside your apartment at once," the letter reads. "If you are caught outside after curfew again and are not en route to your apartment, you will be arrested for criminal trespassing." However, the apartment community's management refused to comment on why the policy was established. The Houston Apartment Association said that while curfews are not a common practice, they can sometimes be a necessary temporary measure. One unnamed resident said loitering has been a chronic problem at The Villages at Meyerland.
One Hundred Reasons to Register Now for the ARM Conference®
Register for the 2013 Apartment Revenue Management (ARM) Conference by August 14 to save $100 off admission to the rental housing industry’s sole event dedicated to staying ahead of the ever-evolving operational curve.
In its third year, the ARM Conference® September 23-25 in Miami, has radically expanded its scope of topics, touching on everything from ancillary income and expense management to the exploration of business intelligence.
Learn more about the ARM Conference® and register today if you are looking to enhance your bottom line and grow your net operating income.
NAA Connect Community of the Week: IRO Community
Calling all Independent Rental Owners to the IRO Community on NAA Connect to connect with a network of IROs from around the country. Sample policies, guides, past conference calls and more relevant ready to-be-used information is waiting for you. Join the Community and the conversation today. This week’s hot conversation topic is generators—login and share your advice with another IRO wondering what to consider before purchasing one.
Help NAA Celebrate Its Diamond Anniversary
The National Apartment Association is turning 75 next year, and would love for you to help us celebrate. In honor of our anniversary, we’re aiming to reach 7,500 fans on Facebook. Stop on by and give us a like; we’ll keep you posted on all the fun things we have cooking for 2014.
‘Rewind’ Your 2013 NAA Education Conference & Exposition
Couldn’t attend the 2013 NAA Education Conference & Exposition in San Diego, or missed a great session? Don’t despair—you still can enjoy the best education sessions in the apartment industry, including video!
NAA’s Education Institute (NAAEI) is once again presenting its “Rewind” program, offering 21 recorded video sessions and 20 PowerPoint-synced audio sessions from the 2013 NAA Education Conference & Exposition—all for just $299!
Attention Suppliers: The Supplier Success Class Was Made For You
NAAEI will offer the course for apartment industry supplier partners, Supplier Success, as a series of 3 webinars.
The Supplier Success course is designed to offer an overview of the apartment industry and recommends ways that suppliers can maximize partnerships with apartment owners, apartment management companies and apartment association members.
The advantage of this live webinar format is that students can participate from wherever they are, even while traveling on business. Students also have the opportunity to ask questions, share experiences and learn not only from the instructors, but from each supplier partner taking the course.
The course is available via webinar series July 16, 18 and 23 from 2 p.m. to 4 p.m.
Registration Fee: $99 for members; $129 for non-members
Group pricing available for 10 students or more, contact Shana Treger. Each webinar will be recorded in the event you miss a class.
NAAEI Designation Courses Offered Near You!
Nevada State Apartment Association
Roanoke Valley Apartment Association
Chicagoland Apartment Association
July - August, 2013
Central Iowa Apartment Alliance
September - October, 2013
Hampton Roads Apartment Council
September – October, 2013
Greater Charlotte Apartment Association
October - November, 2013
Apartment Association of Greater Los Angeles
November - December, 2013
Nevada State Apartment Association
Roanoke Valley Apartment Association
Greater Charlotte Apartment Association
Roanoke Valley Apartment Association
Find more courses in your area on the NAA website.
For more information about any of the classes listed, please contact Kimberly McCrossen at 703/518-6141 ext. 121.
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