CREJ

Page 8 — Multifamily Properties Quarterly — May 2021 www.crej.com Market Update I n March 2020, if someone would have speculated that the Northern Colorado Class A, institutional apartment mar- ket would strengthen over the course of the ensuing year, it’s safe to say it would have been viewed by most experts as an extremely rosy, and likely naïve, outlook amid an unprecedented economic shutdown in response to the global COVID-19 pandemic. With that said, the Class A market in Northern Colorado has shown tremendous resiliency and strength during the past year. This would be impressive in any time period given that there have been nearly 3,000 units within Class A, institutional communities deliv- ered over the past 24 months, but the absorption of those new units has been particularly impressive given that the robust absorption continued, and even appears to have accelerated, during the past 12 months. Despite all of the new supply delivered over the past few years, our firm’s biannual survey of the market indicates strength in the Class A, institutional apartment market within the region. Sta- bilized communities in Larimer County experienced a year-over- year increase in average asking rents per square foot per month of approximately 3.87% with that rate climbing to $1.66. Occupancy also improved significantly (even with all the units in lease-up), increas- ing to 95.46% from 93.17% year over year. In the northern Weld County (Greeley, Evans and east Windsor) occupancies were down ever so slightly from 95.15% to 94.52% and average asking rents per square foot per month were up slightly from $1.41 to $1.42 year over year. These are impressive statistics given the impact of the eco- nomic shutdown brought on by COVID-19. Concessions remain low (one month’s free rent maximum and only in select instances) or nonexistent in the market. Delinquencies have nor- malized closer to a long-term average after the initial economic shutdown and the following sev- eral months when delinquencies increased. In several instances, landlords even have begun charging rent premiums for 12-month leases on certain units within communi- ties, as they are seeking 15-month or longer lease terms. This strength in the market and the in-migration into Northern Colorado from other states, regions and the Denver metro area have led to significant ongoing demand for quality insti- tutional apartment community development sites – and rightly so, as there are less than 1,000 units within Class A, institutional com- munities under construction in the entire region. This compares with nearly 3,000 units that were under construction and in lease-up over the past 24 months. Given the lack of deliveries antici- pated over the next 12-18 months and given that the market has Demand continues to outpace supply in Northern CO Jake Hallauer, CCIM President, NAI Affinity Please see Hallauer, Page 36