Multi-family Apartments Remain Hot Commodity in LR Area, NWA

by George Waldon  on Monday, Nov. 12, 2012 12:00 am  

Construction should start soon on boat slips for John Burkhalter’s marina-residential project in downtown Little Rock.  (Photo by Michael Pirnique)

Jerry Webster is bullish on the northwest apartment market.

“I do a lot of work up there, and I love the market,” Webster said. “It has really stabilized. People make the mistake of looking at that as one market. There is a distinct difference in the three submarkets between Fayetteville, Springdale and Bentonville-Rogers.”

Enrollment growth at the University of Arkansas is driving development of $150 million worth of privately owned student housing near the Fayetteville campus.

One 632-bed project, The Grove, opened in August, and three more projects are under construction that could bring another 1,983 beds on line for the 2013-14 school year.

Benton County is poised for a new round of apartment development as occupancy has climbed to more than 96 percent in its two largest cities.

“Get ready for some new construction in Bentonville-Rogers,” Webster said. “That market has gotten pretty solid.”

He won’t be surprised to see sales activity pick up as the market has tightened and the number of bargain deals from developers gone bust has dwindled.

“The northwest Arkansas market got overbuilt five years ago, but they’ve worked through those problems,” Webster said. “We’ve finally got all the bottom fishers out of the market, the ones looking for foreclosed properties.”

Pulaski County Apartment Market (Mid-Year 2012)

Project AgeOccupancyAvg. Unit SizeAvg. Monthly RentRent Change*
Post-2000 (4,599 units) 95.8% 961 SF $841 0.8%
1990s (2,758 units) 97.4% 898 SF $747 -0.8%
1980s (6,347 units) 94.5% 813 SF $674 -2%
Pre-1980 (9,477 units) 91% 846 SF $609 0.8%
Total (23,181 units) 93.7% 866 SF $689 -0.3%
        *Since Dec. 31, 2011

Pulaski County Apartment Occupancy
1985 - 2012

1985 89%
1986 86%
1987 82%
1988 86.8%
1989 91.4%
1990 92.5%
1991 93.4%
1992 94.4%
1993 95.7%
1994 95.1%
1995 95%
1996 93.9%
1997* 92.9%
1998 91.9%
1999 92.3%
2000 94.4%
2001 93.7%
2002 94.1%
2003 93.9%
2004 93.8%
2005 93.8%
2006 92.6%
2007 92.3%
2008 92.2%
2009 91.5%
2010 93.6%
2011 93.1%

*1997 data extrapolated from trend 1996-1998.

Source: The Multifamily Group LLC of Little Rock

 

 

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