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California  + Apartments  | 
Apartment demand is expected to continue outpacing supply

Workforce Housing Well Positioned to Outperform Market, CBRE Analysis Finds

Strong market fundamentals are attracting a wide variety of investors to workforce housing, creating good returns and helping to preserve affordable accommodation in lower-income communities, according to the latest research from CBRE. Workforce housing has outperformed the overall multifamily market for the past four years, with relatively low vacancy rates and above-average rent growth.

Slow wage growth over the past decade contributing to a high number of potential renters, an extreme lack of new supply, and limited alternative options means strong and sustained demand for workforce housing apartments is expected to continue in 2019, reports CBRE.

The healthy market performance of workforce housing has attracted major investment of nearly $375 billion over the past five years, 51.3% of the total for all multifamily assets. This capital is increasingly coming from unlikely sources, including institutional and cross-border investors.

CBRE’s Brian McAuliffe says, “The balance of the market forces points to continued strength in workforce housing, justifying the strong investment appeal. Investment in this segment also benefits the housing market by preserving much-needed rental accommodations for lower income renters. Value-add investment, in particular, helps to preserve workforce housing inventory directly by improving the physical quality of the asset through renovation.”

Nearly all U.S. metros and submarkets are benefitting from workforce housing’s strong market conditions. The markets with the highest workforce housing rent growth are predominantly higher growth metros. Orlando and Las Vegas lead the country, with 7% rent increases for the year ending Q2 2018. Another eight metros (Jacksonville, Columbus, Tampa, Phoenix, Houston, Inland Empire, Atlanta, San Diego) have growth rates of 4% or more.

For comments, questions or concerns, please contact Dennis Kaiser

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About Dennis Kaiser

Dennis Kaiser is Vice President of Public Relations and Communications for Connect Creative. Dennis is a communications leader with more than 40 years of experience including as a journalist and in corporate and agency marketing communications roles. He is responsible for Connect Creative’s agency client services and is involved in a range of initiatives ranging from public relations and content strategy, communications and message development, copywriting, media relations, social media and content marketing services. Prior to joining Connect Media in 2015, his most recent corporate communications roles involved leading a regional public relations effort across Southern California for CBRE, playing a key marketing role on JLL’s national retail team, and directing the global public relations effort at ValleyCrest (BrightView), the nation’s largest commercial landscape services company. He has worked on marketing communications assignments for such CRE companies as Blackstone/Equity Office, Carlyle, Caruso, Disney Resorts, GE Capital, Irvine Company, Hines, Howard Hughes Corp., Jeffries, Lennar, MGM, Marcus & Millichap, Prologis, Raleigh Studios, Simon, Starwood, Trammell Crow Company, Transamerica, UBS and Wynn Resorts. Dennis has also worked on communications and launch strategies for a number of consumer electronic, media and tech brands including SlingMedia, Channel Master, Deluxe Media Entertainment, BeIn Sports, EchoStar and Sprint. Dennis’s agency background included firms such as Off Madison Ave., Idea Hall and Macy + Associates. He has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator. Dennis has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements. Dennis has been involved in a host of charitable and community organizations including the American Cancer Society, Easter Seals, Boy Scouts, Chrysalis Foundation, Freedom For Life, HOLA, L.A.’s BEST, Reach Out and Read, Super Bowl Host Committee, and the Thunderbirds Charities.

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