IRR-Syracuse Mid-Year Viewpoint 2015 Local Market Report - Multifamily
New construction in the market continues to remain steady as vacancy remains low and rental rates continue to appreciate. Absorption is fairly flat for urban and suburban Class B and lower properties while the greatest absorption is found in the suburban class A market. This market is seeing new construction that is able to achieve stabilized occupancy within a reasonable amount of time following construction. Strong absorption for suburban class A product is expected to remain strong in the near term.
Although the absorption numbers are lower for urban class A properties, this is due to the much lower volume of units coming on line. Almost all new urban class A units are the result of the conversion or renovation of old commercial or industrial buildings and rely heavily on assistance from public funding and/or tax breaks.
Vacancy for this class continues to be very low due to steady demand and lower volume of new units being added to the market. As has been the case for the last few years, many new units are pre-leased prior to completion. This trend is typical across the Buffalo, Rochester, and Albany markets in Upstate New York. Transaction activity for class A properties continues to be limited as owners hold these assets due to the favorable returns they can produce. There are more transactions of Class C type multifamily properties but are typically riskier investments and are more management intensive. The Upstate New York multifamily market does not typically see the ups and downs that can be found in other parts of the nation. The Syracuse market has a stable population though growth is anemic. The same is true with the job market; however, tenancy is fairly stable due in part to the many locations of the state university and college system and expansion of local medical and healthcare campuses. This is expected to help keep the Syracuse market and Upstate market as a whole stable going forward.
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IRR Mid-Year Viewpoint 2015 comprises a National Overview report and 300+ two-page Local Market Reports for all key property types as well as additional resources, including metrics methodology, graphs, and tables; these free reports may be downloaded from IRR’s site here.