Multi Housing news
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Apartment Investment Activity Expected to Continue in New Jersey
By Keat Foong, Executive Editor
AUGUST 03, 2006
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Demand has been driven particularly by institutional investors who like the
state’s economic stability and strategic location, according to Jose Cruz,
senior director of the Cushman & Wakefield’s Metropolitan Area Capital
Markets Group.
Cruz told MHN that since the fourth quarter of last year, apartment occupancies
and rents have increased markedly, with rents rising eight to 10 percent, in
the state. He said cap rates are currently in the low 5 percent for
well-located Class A apartments in the state. “With increasing rents, investors
may be able to pay five percent cap and increase the cap to 7 or 8 percent in
36 months,” he said.
Cushman & Wakefield’s Metropolitan Area Capital Markets Group says that the
apartment investment environment in New Jersey was extremely liquid at the end
of 2005 and during the first half of 2006, with approximately 42 properties
(8,000 units) changing ownership, totaling $1.12 billion in sales.
The median price per unit was $150,000, a rate 30 percent higher than the
national average. Per transaction, the average cap rate was 5.15 percent, and
the average occupancy rate was more than 97 percent, according to Cushman &
Wakefield.
The Metropolitan Area Capital Markets Group said that highlights include Investcorp International’s purchase of the Residences at
The Metropolitan Area Capital Markets Group said it also orchestrated the sale
of
Rhe Metropolitan Area Capital Markets Group
anticipates a continuation of the investment sales trends of the first half of
2006. “Changing interest rates have not impacted investment activity in the
