Multifamily is HOT - L5 Quarterly Update

[Mike Flaherty]

Dear Friends & Associates,

 

As we approach year end 2012, we look back upon another strong year for L5 Real Estate Investments.  Our assets continue to outperform initial financial projections.  Property occupancies are at their highest levels despite entering a typically slower winter/holiday rental season.  We are in contract to sell two properties totaling 312 units and are in current negotiations to acquire another 300-400 units in markets of growth and stability.

 

Multifamily Outlook:  The US economy has restored nearly 3.9 million jobs to the labor market since the economic crash and continues to improve despite continued volatility.  Multifamily investments and the national apartment market continue to strengthen due to higher levels of immigration, a surge in echo-boomers, and the further shift away from and difficulty in securing homeownership which continue to keep apartment metrics in a good position.  The U.S. vacancy rate has dipped to a decade low, while rent growth continues to outpace inflation and income growth.  Multifamily permits are up 20.3% to their highest level since 2008, yet demand will continue to outpace this new supply as we see absorption rates at record levels. 

 

Below are some interesting articles on the current multi-family state of affairs:

 

Multifamily Permits Jump 20 Percent, Highest Level in 4 Years (Mult...

Multifamily still reigns supreme according to the latest data from the U.S. Commerce Department.  Next year, it's estimated that about 130,000 new multifamily units will hit the market. Yet, for the industry to keep up with rising demand and all the units lost to obsolescence, many economists say that we need to create about 300,000 units per year.

 

Multifamily Occupancy Rates Stabilize, Rent Growth Slows (National ...

Axiometrics predicts that average apartment rents will settle into a steady pace of growth over the next few years, similar to rental markets in the mid-1990s, as occupancy rates stay very high  The constrained supply of new apartments should help keep the markets relatively stable.  Barring some unexpected shock to the economy, the apartments markets will continue to be tight.

 

Small Cities are Becoming a New Engine of Economic Growth (Newgeogr...

This year’s edition of Forbes’ Best Cities For Jobs survey, compiled with Pepperdine University’s Michael Shires, found that small and midsized metropolitan areas, with populations of 1 million or less, accounted for 27 of the 30 urban regions in the country that are adding jobs at the fastest rate.

                                                         

L5 Investments continues to provide best in class wealth and asset management via well located, yield driven assets where improved operations and physical improvements maximize earnings and build wealth. 

 

As always, please do not hesitate to contact me should you have interest in learning more about the multifamily industry.

Michael Flaherty

Managing Partner

L5 Real Estate Investments

Apartment Acquisition & Asset Management with High-Yield Performance

www.Lfiveinvestments.com

1926 S. Pacific Coast Highway, Suite 231, Redondo Beach, CA  90277

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L5 supports Mychal’s Learning Place at:  www.Mychals.org

[Gervais Birangui]

Great report!

I hope that we could do some deals in the future?

We requesting Private Money for the full Acquisitions of Multifamily(Apt build) under 50 units at 80 cents/dollar in OHIO .The exit strategy will be a refinance before 24-36 month at 8%-10% to repay the Private Lender in Full.
Gervais Birangui
Office Phone: [phone]
                       440.579.2987
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