Transactions market in Phoenix
There may be an oversupply of residential rental options in the volatile Phoenix market, but the opposite is true of transaction opportunities.
"Transaction velocity is still very stagnant, contrary to popular belief," said multifamily investment specialist Steve Gebing, whose group operates under the Marcus & Millichap umbrella in the Valley of the Sun.
It's easy to compare this year with last year and say transaction velocity is increasing, he said. In 2008, a total of 19 apartment communities with more than 100 units changed hands. As of Nov. 23, that number stood at 29.
"So, velocity is up, but not that much, compared to where we were in previous years, especially when you look at the hyper-growth years of ‘05 and ‘06," he said of the boom time when many unwise decisions on the multifamily investment side were based on speculation.
At the peak of the market in 2005, Phoenix saw 219 transactions, dropping to 184 in 2006 and 124 in 2007. "My belief is that we'll close out this year somewhere in the range of 30 to 33 closings for the calendar year, which will be around 75 percent. So that's a good sign. But, more importantly, the key indicator for us as brokers is demand. The pent-up demand is no longer pie-in-the-sky. The facts are the facts and now we are really seeing true activity," said Gebing, who, along with his partner Cliff David, operates a boutique brokerage
