The multifamily sector has shown signs of growth and increased activity. While there has been a slight decrease in multifamily occupancy rates since 2012, the Dayton region as a whole has remained stable and currently maintains a vacancy rate in the 7-8% range.
In past years, out-of-market investors have been wary about Dayton’s commercial real estate assets; however, this trend seems to be changing. Multifamily properties, in particular, are among those generating interest and confidence with these investors. Some notable transactions involving out-of-market investors include the sale of Georgetown Apartments in Kettering for $12.7 million, The Cannery in downtown Dayton for $4.9 million and Stonebridge Apartments in Beavercreek for $17.75 million.
While Dayton is known for its beautiful suburbs and high-achieving school districts, there has been a gradual increase in urban living. According to the 2013 Miller-Valentine Group Realty Services Apartment Market Survey, the Central Business District has a vacancy rate of just 2.37%. This increased demand for urban housing has opened the door for developers to add inventory in the form of new and re-developed multifamily facilities. Significant projects in the pipeline for the downtown area include Patterson Place – 31 planned townhomes, the Sixth Street Lofts – 18 planned condominiums, and a 200 unit student housing project located on the site of the former Dayton Daily News building. The uptick in urban dwellers will also stimulate additional commercial and retail users in the Dayton Central Business District.
Moving into 2014, we expect occupancies and rental rates to remain stable. Investors will continue to have a bullish outlook for Dayton’s multifamily market. We should also see an increase in market rate projects as the economic environment moves from recovery to expansion.