Craig Collins, senior director with Cushman & Wakefield|Commercial Kentucky, has been brokering multifamily deals in the Louisville market for more than three decades. When he says that Louisville’s multifamily sector is as strong as it’s ever been? That means something.
Demand, new developments and monthly rents are all rising in this sector, Collins said. And this trend is showing no signs of slowing.
Collins points to demographic changes as one of the reasons. Empty nesters are becoming renters by choice, ditching their single-family homes to rent an apartment in the city, Collins said. At the same time, younger adults are putting off buying single-family homes and are instead choosing to rent for longer periods.
Again, these are trends that are only gaining strength, Collins said.
“Amenities and conveniences are important to these renters,” Collins said. “They want access to the high-amenity gyms that are found in newer apartment buildings. They want pools and rooftop decks. They want the convenience of being close to public transportation and restaurants. They want the features that they might not get in single-family homes.”
You can hear more about what Collins has to say about the Louisville multifamily sector during the 4th annual Louisville Commercial Real Estate Summit held Sept. 19 at the Omni in downtown Louisville. The event, held by Midwest Real Estate News and REjournals.com, will feature not only Collins but other top CRE pros in the Louisville area. These professionals will highlight trends in the industrial, healthcare, retail, office and multifamily sectors in the Louisville market.
At the same time, unemployment is low and the economy is strong in Louisville. These two factors, too, have combined to provide a boost to the city’s multifamily sector.
Developers have responded, adding new product to Louisville’s supply of apartments. And these apartments today increasingly come with high-end amenities, features designed to attract the greatest number of renters.
Collins said that new apartment buildings come with fitness centers that are equal to those offered by private gyms. They offer pet wash or pet spa features. Some provide indoor golfing. And many are providing secure delivery boxes for Amazon orders.
“It’s all about convenience and quality of life,” Collins said. “These are the amenities that people are looking for when they decide to rent.”
As in other Midwest markets, much of the new apartment supply in Louisville is rising in the city’s urban core. This, though, is a change, Collins said. In the past, class-A apartment developments came online in Louisville’s suburbs, not in its downtown.
But in the last 18 months? Developers, many of them from out of state, have added modern Class-A supply to downtown Louisville. Collins said that the urban core now features five urban or near-urban Class-A amenity-stocked apartment properties in the city’s downtown.
In more good news? Developers have not flooded Louisville with new apartment product. This means that supply has not yet outpaced demand. In fact, Collins said, Louisville is under-supplied when it comes to new apartment units.
“We have not overbuilt like in other communities,” Collins said. “We have not overextended ourselves with new development. There is space here for a variety of new product, and that new product should be well-occupied and stabilized for at least the foreseeable future.”
For more information or to register for the Louisville Commercial Real Estate Summit, click here.
