Posted 13 Aug 19 By: No comments yet

A One-on-One with Albuquerque’s Multifamily Experts

The multifamily team believes strongly in the value of teamwork, and views every real estate transaction as a puzzle to be solved through group communication and idea-sharing.  Their understanding and engagement of technology coupled with solid work ethic provide their clients with a smooth transaction and a personable, high-caliber experience.

As leaders in Multifamily sales, we sat down with Advisors, Steve Kraemer, CCIM, and Isaac Romero, to discuss their thoughts on the current state of multifamily housing sales in Albuquerque.

What was your forecast of the 2019 Multifamily sector?  Is your forecast turning out to be correct?

Our 2019 forecast called for an increase in apartment values due to continued upward pressure on average rents.  We’ve seen the market do just that so far in 2019, though we’re keeping an eye on interest rates

With the low cost of capital right now we are seeing significant activity in the market.  

Do you see global issues of increased tariffs on imported materials and growing labor shortage as an impact to multifamily developments? 

As with any project requiring construction, the tariffs add costs as well as a level of uncertainty for developers.  However, we have not seen a slowdown in the development of apartments or the trading of apartments in the market. 

Housing affordability continues to be on the front burner both globally and locally.  Will we see workforce housing supply increase, in an effort to meet demand? 

We expect to see fairly equal development of both market-rate apartments and subsidized, or low-income housing.  There is demand in all state geographies for additional apartment units including Albuquerque, Rio Rancho and especially Santa Fe. 

What can developers do to ensure their properties are future-forward?

Connectivity and quality common area spaces are keys to producing a future-forward property.  Co-working spaces, game rooms, movie rooms are all trends in the apartment market currently.  

What tech trend will most impact future apartment/multifamily developments?  

It will be interesting to see if driverless cars affect multifamily in the same way it is predicted for office and retail, specifically in the required number of parking spaces.  If the new normal is driverless car services, developers may be able to maximize the density of their multifamily projects.  Existing developments may be able to remove parking and add additional units.  It’s going to be a very interesting time as driverless cars become more mainstream. 

The rental market is forecasted to increase as Millennials choose the flexibility of renting over owning and as Boomers downsize. Are we seeing any evidence of that in Albuquerque?

Yes.  We’re seeing increases in the demand for apartments across generations, which is putting upward pressure on rental prices for tenants.   

What does Albuquerque need more of in the multifamily market?

Studies show a need of over 5,000 apartment units in the Albuquerque/Rio Rancho markets.  A wide variety of product types (i.e., 4 units up to 400 units) is needed. 

What are the top factors about a property that attracts a multifamily investor?

Predictable net income, good financing options, and the low cost of tenant turnover are three key reasons investors are attracted to multifamily properties. 

Meet Steve and Issac:

Steve Kraemer joined NAI Maestas and Ward in 2014. His 11+ years of experience in commercial real estate include working in multiple disciplines—multifamily, office, retail, and industrial properties. Steve
heads up the Multifamily division for NAI Maestas and Ward and is highly active in the office and industrial markets as well.

Isaac joined NAI Maestas & Ward in October 2018 after working for New Mexico’s top budget agency—the Legislative Finance Committee—where he was responsible for nearly $500 million in state agency budget recommendations. Using the knowledge, experience, and relationships gained from his time with the legislature, Isaac intends to share his vision for a more prosperous New Mexico through brokering commercial real estate and promoting economic development in our state. As an investor in multifamily real estate, Isaac specializes in multifamily investments. As a promoter of business, Isaac is growing his expertise in retail, including leasing, acquisition, and disposition.

To learn more about our Multifamily team watch our Advisory Team Video here

 

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