HUMPHREYS & PARTNERS ARCHITECTS, L.P.
5339 Alpha Road, Suite 300
Dallas, TX 75240
www.humphreys.com marketing@humphreys.com
FOR IMMEDIATE RELEASE Mark Humphreys, AIA, CEO
(972) 701-9636
(972) 701-9639 FAX
Leading Indicators Show Spike in Multifamily Development
DALLAS – Telling statistics about the last half of 2010 are prompting apartment developers to get back in the game, fueled by demand for high-end product and rosy rent gains in the near term.
At the crux of the development recovery is the return of conventional financing. "Without it, there would be no new starts," says Mark Humphreys, CEO of Dallas-based Humphreys & Partners L.P., "and there is real demand out there. We had a 270 percent increase last month in incoming phone calls about new work, compared to January 2010. That has to mean something."
Humphreys ' in-house tracking of the market coincides with national reports that show a marked uptick in the multifamily sector after second quarter 2010 and building on that strength throughout the early months of 2011. Fundamentally, it's time to build since it takes, on average, 22 months to get from drawing board to ribbon-cutting.
"It's going to be years before production catches up to demand. Rents and occupancy will be increasing," stresses Humphreys, whose firm as the nation's leading apartment architect is proving to be a leading indicator of the times. Since midyear 2010, the firm has experienced nearly a 40 percent increase in the number of projects in its eight U.S. offices.
The underlying story is demand from both ends of the spectrum – Echo Boomers replacing college dorms with market-rate units close to employment centers and empty-nesters racing to fill high-end mixed-use urban product rather than downsize in the suburbs. Demographical studies have now surfaced that question the value of homeownership, creating yet another driving force for the rental market.
U.S. occupancy rose two percentage points, ending 2010 at 93.5 percent. Rent growth
last year averaged 2.5 percent nationwide, with select markets posting higher gains, according to Greg Willett of Carrollton, Texas-based MPF Research, a division of RealPage Inc. Research now shows demand is four times greater than the 60,000 units that delivered in 2010.
Buoyed by market demand, developers began construction on 90,000 units in 2010, approximately 25,000 more than 2009. Market-rate units accounted for nearly half of last year's starts. In reviewing the year's totals, Humphreys & Partners Architects discovered its 2010 volume represented 15 to 20 percent of the U.S. starts.
Developers are back in the game with larger projects in urban neighborhoods after hunkering down through the downturn with limited construction primarily focused on smaller developments in outlying markets, according to Humphreys. Design-wise, mixed-use and green are chief on the list. All recent Humphreys-designed projects have allowed for plug-ins for electric cars, including the acclaimed "Big House"® apartment design, which has garage wiring in place for easy installation of plug-in panels. Fifteen percent of the firm's clients are looking at photovoltaic panels.
Lenders, developers and investors alike are asking for green features in projects. "Looking forward, it's a major competitive advantage," Humphreys says, "and it is expected by clients."
NOTE TO EDITORS:
Interested parties can request additional information about Humphreys & Partners Architects and its services by contacting the marketing department at marketing@humphreys.com or by visiting the company's website at www.humphreys.com.
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