Memphis multihousing sweet spot
Back in the days when the lending was easy, when seemingly everyone was buying a house, a Memphis, Tenn. builder was know for leaving fliers on apartment doors.
"Don't feed the rent monster," said Fogelman Properties President and COO Mark Fogelman, recalling the slogan on fliers circulated throughout the mid-2000s. "He actually had a picture of a monster taking money out of a couple's pockets."
Times change.
Today's monster is foreclosure. The relevant picture might be of a couple hanging upside down on their front porch, their last coins falling from pockets turned inside out.
"We overbuilt here on the residential side, but it's hard to overbuild on the multifamily side because lenders are more conservative," said Steve Woodyard, president of Woodyard Realty, a brokerage for multifamily real estate.
"From an operations perspective, we think multifamily will hold up better than the other real estate sectors," said Eric Bolton Jr., CEO and chairman of Memphis-based Mid-America Apartment Commun-ities.
"People have to have shelter, even with the lack of job growth."
First-quarter numbers from CB Richard Ellis' MarketView show occupancy in the Memphis market at 89.4 percent, a 0.1 percent decline from the fourth quarter of 2008.
But street rents rose $5 from year-end 2008 to an average of $714, or by an annualized 2.4 percent.
New construction, as expected,
