Profimex Market Review Update – October 6, 2020
6.10.2020
Multifamily Developers Offer Generous Concessions to Fill New Buildings
As a result of the pandemic, Americans face job losses and economic uncertainties. Further, demographic movements to suburbs can be witnessed. For residential developers, these trends can become a challenge, especially when there are still new projects to be delivered in 2020 and operators having to find tenants to lease-up the apartments. To resolve this difficulty, developers are offering several concessions. According to Zillow, of the six types of concessions it tracks, periods of free rent are the most common concession (90.8 percent), with periods spanning from two weeks to up to two months. Other concessions include reduced or waved deposits (9.1 percent) and gift cards (6.6 percent).
Open-Air Retail’s Dominance Could Last Well Beyond the Pandemic
Many real estate professionals and experts are certain that the pandemic will leave a lasting effect on the retail sector, especially on indoor shopping centers. However, within the larger retail sector, free standing outdoor retail centers are expected recover faster than other retail types. Data analytics firm Placer.ai recently compared indoor and outdoor shopping centers visitors and found that outdoor mall visitors were down 24.6%, while indoor mall visitors were down 37.2%. Other supporting arguments can be found in this Article.
