Sunday, March 14, 2010

A Warm Winter for Rentals

By ANTOINETTE MARTIN

 IN the depths of winter, there were big flurries of rental activity at several of New Jersey’s more luxurious apartment buildings — which came as a bit of a surprise even to the brokers and developers.

     At 50 Columbus, a tower in Jersey City that opened in 2007, “the numbers are really pretty amazing,” said Jacqueline Urgo, the president of the Marketing Directors, a Manhattan company that oversees leasing there. She said 35 apartments had been leased in January and 48 in February, even though it was the snowiest month in state history, according to those who keep such figures.

     Up the street at Grove Pointe, another tower near the Grove Street PATH station, the rental pace was also strong, Ms. Urgo said, with 14 apartments leased in January and 24 in February.

     “People came out,” she said. “They came with their snow boots on.”

     But why?

     Ms. Urgo and other rental market specialists offered ideas, but none suggested that they knew a definitive reason for any uptick, or that they believed a full recovery was under way — particularly since concessions like a month’s free rent, or maybe two, are still necessary to attract tenants.

     “We have definitely noticed the market started to loosen up right after the holidays,” said Jonathan Moore, a vice president at the Value Companies, which owns and manages hundreds of garden apartments around the state and last year opened 140 Mayhill, a 158-unit complex in Saddle Brook.

     “We are happy about it,” Mr. Moore said, “but we’re not 100 percent sure where it is coming from.” One factor, he said, may have been that his company was spending more on online marketing and advertising at sites like ApartmentGuide.com and ForRent.com, both former print-only magazines.

     Ms. Urgo’s theory was that it had sunk in for “almost everyone” that the moment was opportune for bargains in both condominiums and rentals. (Her company handles both in Hudson County.)

     But for a condo purchase, she added, “many people just don’t have enough saved up for the larger down payments that are required now. Many of the new rental buildings also offer more amenities than people could get with the purchase of a condo in their price range. Everyone is focused on getting value for their money, whether they are buying or renting.”

     Furthermore, said Rich Murphy, a managing director for Trammell Crow Residential, the uncertain state of the housing market remains a factor. “Some people feel renting is more sensible and less risky than signing a 30-year mortgage commitment right now,” he said.

     Mr. Murphy’s company started marketing the first 320 units at the Alexan CityView, the first development of any kind on a former military base in Bayonne, last May. “We were a little unlucky with our timing, and the economy,” he added. Still, he said 70 percent of units had been leased, including more than a dozen in February.

     As a factor in the increase he cited a new promotional campaign offering two months’ free rent, as well as free shuttle service and a year’s pass to the nearby Hudson-Bergen Light Rail and the Grove Street PATH train, worth $1,344. He expects these inducements to continue drawing people during the spring.

     Rents start at $1,543 for a one-bedroom at the complex, which has two- and three-bedrooms as well, and also a small group of town houses.

     By contrast, Shelby Wood, a new renter at 50 Columbus, says she pays $1,950 a month for a one-bedroom. Ms. Wood fell in love with a particular unit, which is on the seventh floor, home to the building’s amenities and thus endowed with higher ceilings than many others. The price includes two months’ free rent with a 14-month lease.

     “This is a good thing,” said Ms. Wood, a 32-year-old radio station sales manager who works in Manhattan, “because I left my apartment in Manhattan that I had lived in for seven years two months before the lease was up, and they haven’t been able to re-rent it yet.”

     Ms. Wood said she decided to make the move at this time because she wanted a nicer place, with more windows and amenities, than she had in her Chelsea apartment — and knew that “the deals are out there right now.”

     In Morristown, at the new Highlands at Morristown Station rental building beside the train station, five or six apartments per week were rented during January and February, said Debra Tantleff, the marketing director for the Roseland Property Company.

     A one-bedroom at the Highlands costs $1,744 a month, and rent concession packages are available, Ms. Tantleff said.

     The pace of rentals was also up over the last two months at Pier Village, the large mixed-use development beside the beach in Long Branch, Ms. Urgo said. A total of 56 leases were signed in January and February.

     “That is more understandable, though,” she said, “since people are looking past the snowy winter when they go to Pier Village. The leases are for a year, but winter is when people start thinking about where they want to be when it gets warm.”

Sunday, February 28, 2010

Apartment vacancies stabilizing

BY DONNA ROLANDO

      The nation’s 8 percent apartment vacancy rate in 2009 was the highest in almost 30 years, but New Jersey’s rate is well below that, and experts say it could drop as 2010 progresses.

     “If there’s a tenant in a position to negotiate [rent or other concessions], they should do it sooner rather than later,” said Ryan Severino, economist for Manhattan-based research firm Reis Inc.

     As 2010 progresses, the climate will be less favorable for tenants, he said, predicting the state will see an economic upswing and more stable vacancy rates.

     “Hopefully by late in the year, when the economy is in a bit better place and the job market is too, people will feel more optimistic about their prospects so they will be more inclined to lease an apartment than they are during the throes of a recession. This will help to stabilize the market and prevent rents from falling further and vacancy from increasing,” Severino said.

     When vacancy rates are high, landlords are more apt to be generous with tenants.

     Jonathan Moore, vice president of business development at Clifton-based Value Companies, managing 3,600 units nationwide, said the philosophy at Value’s apartment sites has been to beef up services, but not cut rent.

     “I would say in New Jersey our occupancies are stable. We average in the mid-90 percent per property but we worked harder to attract and maintain tenants over the last couple of years,” he said.

     This has meant adding staff to help with tasks like carrying the groceries. Tenants can also call customer service 24/7, and will soon be able to pay their rent online.

     With newspaper ads also highlighting winter specials, first month rent-free and other promotions, clearly landlords in northern New Jersey are aggressively seeking to gain and retain tenants.

     “First and foremost, you see concessions in the market,” said Harvey Rosenberg, Mid-Atlantic regional manager in the Iselin office of For Rent Media Solutions. There may be some slight declines in rent, he said, but concessions take the lead. Over the last six months, he said, some apartments have offered as much as three months free rent. Others have stopped charging for amenities like the fitness center, and still others have stepped up their marketing to reach more tenants.

     But why are New Jersey’s vacancies more stable than many other states?

     Severino said that New Jersey has advantages like proximity to Manhattan and its job market, healthy population figures enhanced by immigration, and the high price of homes that leaves rentals as the only option for many.

     Another industry expert who gave New Jersey high marks for its apartment industry is Marcus & Millichap Real Estate Investment Services, a nationwide firm with an office in Elmwood Park.

According to the firm’s 2010 National Apartment Report, New Jersey ranked six out of 44 markets analyzed across the country for the strength of its apartment industry, said Michael Fasano, vice president and regional manager.

     Over the past year, the state fell from No. 5, but even with that slight decline, Fasano said, “If you’re in the top 10, you’re doing really well.” The report states that New Jersey dropped a notch in ranking due to forecasts for accelerating construction and rising vacancies.

     There’s no question New Jersey’s apartment market is “not as robust as it once was,” he said, but New Jersey doesn’t have a fattened inventory of new projects hiking up vacancy rates.

     He too anticipates a turnaround as 2010 moves ahead.

January 30, 2010

Builder offers discounts to members of U.S. Military

CLIFTON — Value Companies has introduced a new program to recognize the acts of patriotism and volunteerism of United States Military service men and women.

     The Clifton-based company has announced its “Military Apartment Program.” This offers active U.S. Military personnel, or returning veterans from Iraq and Afghanistan, 20 percent off monthly rental rates at its apartment homes in New Jersey, according to Andrew Abramson, president of Value Companies. The offer also applies to the company’s communities in New York, Pennsylvania and Texas.

     “We decided to introduce this program as a way to thank and reward the men and woman who put their lives in danger to protect our country,” Abramson said. “Several of our rental properties are in close proximity to military bases. This program will provide soldiers and their families with an affordable housing opportunity when they are on active duty and a welcoming home when they return.”

     Value Companies owns and manages a portfolio of 3,600 residential units throughout New Jersey, Pennsylvania, New York, Texas and Florida. Some of those situated close to U. S. military facilities include:

• The Gateways at Randolph, in Morris County, is seven miles from the Picatinny Arsenal. It features one- and two-bedroom apartment homes in buildings with classic European and Western architecture. On site, residents have a pool, a children’s playground, a picnic area, a volleyball court and storage rooms. Monthly rentals range from $995 to $1,865.
• The U.S. Military Academy at West Point, in West Point, N.Y., is 30 miles from Sutton Hill and The Point at Sutton Hill, neighboring rental communities in Middletown, N.Y. Sutton Hill features 276 homes with monthly rents beginning at $885. The Point at Sutton Hill recently opened its leasing program with 112 one-, two- and three-bedroom, garden-style homes in 10 residential buildings. Homes range from 773 to 1,234 square feet and monthly rents are expected to range from $1,200 to $1,750. Shared amenities for both communities include tennis courts, a basketball court and an on-site pool.
• Creek Village, a rental community in Levittown, Pa., is five miles from the U.S. Army Reserve Base in Bristol, Pa., and 25 miles from the McGuire-Dix-Lakewood joint Air Force Base in Burlington County. It is directly off Route 13 and close to I-95. Monthly rents for the community’s one- and two-bedroom homes begin at $775.
• Fort Monmouth, a U.S. Army base in Eatontown, is 25 miles from Crestview Apartments in Parlin, which offers modern one- and two-bedroom apartments near the Garden State Parkway. Rents begin at $860 per month. Amenities include storage space, a playground, a picnic area and a basketball area.

     For more information, contact Value Companies at 973-473-2800 or visit www.valuecommunities.com.

 

Gateways at Randolph in Morris County, N.J. is just seven miles from the Picatinny Arsenal

Value Companies Announces Military Service Program with 20% Off Monthly Rental Rates At Apartment Communities In NJ, NY, PA & TX

CLIFTON, N.J. — Value Companies has recently introduced a special new program to recognize the efforts and acts of patriotism and volunteerism of United States Military servicemen and woman.

The Clifton, N.J. based company announced its “Military Apartment Program,” offering active U.S. Military personnel or returning veterans from Iraq and Afghanistan 20% off monthly rental rates at apartment communities throughout its portfolio of apartment homes in New Jersey, New York, Pennsylvania and Texas, according to Andrew Abramson, president of Value Companies.

“We decided to introduce this program as a way to thank and reward the men and woman who put their lives in danger to protect our country,” Mr. Abramson says. “Several of our rental properties are in close proximity to military bases and this program will provide soldiers and their families with an affordable housing opportunity when they are on active duty and a welcoming home when they return.”

Value Companies currently owns and manages a portfolio of 3,600 residential units located throughout New Jersey, Pennsylvania, New York, Texas and Florida. Some of those situated in close proximity to United States military facilities include:

* The Gateways at Randolph in this Morris County, N.J. township is located just seven miles from the Picatinny Arsenal in northwest New Jersey. Gateways features one-and two-bedroom apartment homes in buildings designed in classic Greek, Early American, European and Western architecture. On-site, residents will find a pool, children’s playground, picnic area, volleyball court, and storage rooms. Monthly rentals range from $995? to $1,865.

* The world famous United States Military Academy at West Point in West Point, N.Y. is located 30 miles from The Point at Sutton Hill and Sutton Hill, neighboring rental communities in Orange County, N.Y.’s Middletown. Sutton Hill features 276 homes with monthly rents beginning at $885. The Point at Sutton Hill recently opened its leasing program with 112 state-of-the-art one-, two-and three-bedroom garden-style homes in ten residential buildings. Homes range from 773 to 1,234 square-feet and monthly rents are expected to range from $1,200 to $1,750. Shared amenities for both communities include tennis courts, basketball court and onsite pool.

* Creek Village, a rental community located directly off of Route 13, and close to I-95 in Levittown, Pennsylvania, is five miles from the United States Army Reserve Base in Bristol, PA and 25 miles from the McGuire-Dix-Lakewood joint Air Force Base in Burlington County, NJ. Monthly rents for the community’s one-and two-bedroom homes begin from $775.

* Fort Monmouth, a U.S. Army base located in Monmouth County, N.J.’s Eatontown, is situated 25 miles from Crestview Apartments in Parlin, N.J., which offers a collection of modern one-and two-bedroom apartments minutes from the Garden State Parkway. Rents begin at $860 per month. Impressive amenities include plenty of storage space, playground, picnic area and basketball area.

For more information on these or any other Value Companies rental communities, please contact the company headquarters at 973-473-2800 or visit www.valuecommunities.com.

About Value Companies
Value Companies, founded in 1952, is a leading real estate development, investment and management company headquartered in Clifton, N.J. The company currently owns and manages a portfolio of 3,600 residential units located throughout New Jersey, Pennsylvania, New York, Texas and Florida.

Across its development division, Value Companies has embarked on $100 million in new apartment, condominium and mixed-use developments and investments in strategic suburban and urban locations throughout the country. Value’s development success is directly tied to its steadfast commitment and expertise in multifamily housing, and its ability to introduce new housing products that address consumer and community needs.

Value’s residential properties are built and managed by a highly-skilled, in-house management team of more than 80 industry professionals which oversee all aspects of Value’s communities, including construction, leasing, maintenance and property management. Value’s third-party management business, Value Asset Management, provides full-service management capabilities and customized asset solutions to a growing list of third-party real estate investment and property owner clients.

For more information, please contact Jonathan Moore, Vice President of Business Development at Value Companies’ headquarters at 973-473-2800 or visit www.valuecompanies.com.

###

MIDDLETOWN, N.Y. – An Open House will take place this Sunday (January 24th) from 12 p.m. to 4 p.m. at The Point at Sutton Hill, the new collection of 112 upscale rental homes at this well-established apartment community in the Orange County, N.Y. town of Middletown.

The much-anticipated event will provide an up close look at the initial offering of 24 rental residences at the neighborhood, according to the Value Companies, Inc., owner/developer/manager of Sutton Hill. For additional information or to attend the Open House, please call (845) 343-2272 or email
suttonhill@valuecompanies.com.

The Point at Sutton Hill features state-of-the-art one-, two-and three-bedroom garden-style homes in ten residential buildings. Homes range from 773 to 1,234 square-feet and monthly rents are expected to range from $1,200 to $1,795.

The story of Sutton Hill is one of persistence and resiliency and The Point at Sutton Hill represents the final step in the initial plan Value Companies, Inc. had for a large-scale rental community near the Catskill Mountain resort area in the late 1970s.

While Orange County – once considered a popular vacation destination for Manhattanites – was struggling to attract residents and businesses by the 1970s, the area was seemingly poised for revitalization with the promise of a large commercial airport at Stewart Air Force Base and the anticipation of legalized gambling.

Enter the Value Companies. Hoping to capitalize on the reemergence of the Catskill Mountains, the developer purchased the existing 276-home Sutton Hill community in a foreclosure sale, but was unable to secure an adjacent 11.5-acre site that was planned as Phase II of the original development. The developer made several attempts to purchase the land, eventually backing off once it was evident the dream of an airport and possible casino was in doubt.

“As the 1970s rolled into the 1980s, it became clear the Orange County boom wasn’t going to happen,” points out Jon Moore, Vice President of Development for the Value Companies. “That didn’t mean the company wasn’t fully committed to the region.

“We completed improvements and the repositioning of Sutton Hill and managed it intently – all while keeping an eye on the possibility of acquiring and developing the final phase of Sutton Hill. It was never a question of whether, but rather that of when.”

In December of 2005, the Value Companies finally purchased the site and began plans to construct a new modern, state-of-the-art rental complex, as well as undertake significant renovations and improvements to the existing Sutton Hill buildings.

“Our dedication and confidence in the project is evident by our willingness to move forward and introduce The Point at Sutton Hill despite current economic conditions,” Mr. Moore says. “In addition to providing brand new apartments, we’re also reviewing plans to invest $2-3 million into exterior and site upgrades in the original Sutton Hill buildings and the construction of a new community clubhouse.”

For additional information on The Point at Sutton Hill, please call (845) 343-2272 or email suttonhill@valuecompanies.com.

About Value Companies
Value Companies, founded in 1952, is a leading real estate development, investment and management company headquartered in Clifton, N.J. The company currently owns and manages a portfolio of 3,600 residential units located throughout New Jersey, Pennsylvania, New York, Texas and Florida.
Value’s residential properties are built and managed by a highly-skilled, in-house management team of more than 80 industry professionals which oversee all aspects of Value’s communities, including construction, leasing, maintenance and property management. Value’s full-service management capabilities also serve a growing list of third-party real estate investment and property owner clients.

Across its development division, Value Companies has embarked on $100 million in new apartment, condominium and mixed-use developments in strategic suburban and urban locations throughout the country. Value’s development success is directly tied to its steadfast commitment and expertise in multifamily housing, and its ability to introduce new housing products that address consumer and community needs.

For more information, please contact Value Companies’ headquarters at 973-473-2800 or visit www.valuecompanies.com.

MIDDLETOWN, N.Y. – The Point at Sutton Hill announces its Grand Opening to the public with 112 upscale rental homes at this well-established apartment community in the Orange County, N.Y. town of Middletown.

The much-anticipated opening comes with several homes in the community’s initial offering of 24 residences already reserved, according to the Value Companies, Inc., owner/developer/manager of Sutton Hill. An Open House for the rental complex will take place this Sunday (December 13th) from 11 a.m. to 4 p.m. For additional information, please call (845) 343-2272.

The Point at Sutton Hill features state-of-the-art one-, two-and three-bedroom garden-style homes in ten residential buildings. Homes range from 773 to 1,234 square-feet and monthly rents are expected to range from $1,200 to $1,795.

“We are delighted to unveil The Point at Sutton Hill which completes the 30-year vision our company originally had for the Sutton Hill neighborhood,” says Jon Moore, Vice President of Development for the Value Companies.

“By offering upscale apartments complete with the latest features and appointments , we are confident this new neighborhood will be an extremely popular alternative for renters – especially in light of the fact that the rental market in upstate New York continues to be extremely strong, with few contenders to fill a void of new-construction rental alternatives.”

The story of Sutton Hill is one of persistence and resiliency and The Point at Sutton Hill represents the final step in the initial plan Value Companies, Inc. had for a large-scale rental community near the Catskill Mountain resort area in the late 1970s.

While Orange County – once considered a popular vacation destination for Manhattanites – was struggling to attract residents and businesses by the 1970s, the area was seemingly poised for revitalization with the promise of a large commercial airport at Stewart Air Force Base and the anticipation of legalized gambling.

Enter the Value Companies. Hoping to capitalize on the reemergence of the Catskill Mountains, the developer purchased the existing 276-home Sutton Hill community in a foreclosure sale, but was unable to secure an adjacent 11.5-acre site that was planned as Phase II of the original development. The developer made several attempts to purchase the land, eventually backing off once it was evident the dream of an airport and possible casino was in doubt.

“As the 1970s rolled into the 1980s, it became clear the Orange County boom wasn’t going to happen,” Mr. Moore points out. “That didn’t mean the company wasn’t fully committed to the region.

“We completed improvements and the repositioning of Sutton Hill and managed it intently – all while keeping an eye on the possibility of acquiring and developing the final phase of Sutton Hill. It was never a question of whether, but rather that of when.”

In December of 2005, the Value Companies finally purchased the site and began plans to construct a new modern, state-of-the-art rental complex, as well as undertake significant renovations and improvements to the existing Sutton Hill buildings.

“Our dedication and confidence in the project is evident by our willingness to move forward and introduce The Point at Sutton Hill despite current economic conditions,” Mr. Moore says. “In addition to providing brand new apartments, we’re also reviewing plans to invest $2-3 million into exterior and site upgrades in the original Sutton Hill buildings and the construction of a new community clubhouse.”

For additional information on The Point at Sutton Hill, please call (845) 343-2272 or email suttonhill@valuecompanies.com.

About Value Companies
Value Companies, founded in 1952, is a leading real estate development, investment and management company headquartered in Clifton, N.J. The company currently owns and manages a portfolio of 3,600 residential units located throughout New Jersey, Pennsylvania, New York, Texas and Florida.

Value’s residential properties are built and managed by a highly-skilled, in-house management team of more than 80 industry professionals which oversee all aspects of Value’s communities, including construction, leasing, maintenance and property management. Value’s full-service management capabilities also serve a growing list of third-party real estate investment and property owner clients.

Across its development division, Value Companies has embarked on $100 million in new apartment, condominium and mixed-use developments in strategic suburban and urban locations throughout the country. Value’s development success is directly tied to its steadfast commitment and expertise in multifamily housing, and its ability to introduce new housing products that address consumer and community needs.

For more information, please contact Value Companies’ headquarters at 973-473-2800 or visit www.valuecompanies.com.

BY DONNA ROLANDO

If you want to stick like glue to your excuses for not exercising, don’t read this article. Especially don’t continue reading if your primary excuse for not lifting a dumbbell is that your apartment is too small.

Exercise pros say there is no one road for renters to get in shape.

Regardless of whether you live in a luxury apartment complex with its own gym or a less expensive place where space is limited, you can still lose the pounds — if you lose the excuses.

The trick is to get motivated, designate a workout area, and think outside the box for exercises that don’t count on lots of jumping or clunky gear.

* In a small apartment

“I don’t think people think they can’t work out in an apartment. I think they don’t know what to do,” said Adam Campbell, fitness director for Men’s Health and author of “Big Book of Exercises.”

“The truth is you really don’t need any equipment to get a total body workout. There are tons of ways to make any exercise more difficult,” he said.

“Body weight training is one of the best things you can do in your apartment with no equipment,” said Roderick Lapid, a personal trainer in northern New Jersey who goes to homes, including apartments, to pump up exercise routines.

He directs renters to push-ups, crunches and Pilates, all well-suited for a roll-up exercise mat.

“Yoga is great,” he said.

To beef up the intensity of a workout, try handstands, inverted push-ups and even walking on your hands, he said.

Dumbbells and especially kettle bells take up little space and can add intensity to traditional exercises like squats. A stability ball fits right in the closet. Also ideal for small spaces are stackable power blocks as well as suspension straps, which require only a door.

Out of courtesy to neighbors, small-apartment dwellers are likely to have to forgo aerobics, but they still need cardio.

“You need to get the heart rate going,” said Lapid, who likes the kettle bells for combined benefits of strength and heart-rate training.

Get creative in designating your exercise setting. Even if it’s a corner, he said, “leave a yoga mat laid out and have your exercise tools available.”

With any form of exercise, he advised that one should focus on a goal and ask, “Am I getting what I want out of this?”

Hoboken resident Jeff Thomsen, president of Fitness Solutions Direct, said: “You can find different workouts to try online or in magazines. Bottom line is if you have space and some sort of resistance you can put yourself through a great workout.”

John Rowley of The American Institute of Healthcare and Fitness, said it’s key to “work every body part even in the tightest studio apartment. You can also take your dumbbells into the staircase and take every other step for a lunge effort that will work your legs and buttocks while doing cardio. Time effective and space efficient.”

* When a fitness center is nearby:

Some renters are so dedicated to fitness, they make it a priority to seek out a luxury apartment complex with a state-of-the-art gym. Gary DuBoff had this in mind when he recently rented at 140 Mayhill, a 158-unit complex in Saddle Brook.

“I would not have moved into a complex that didn’t have a fitness center,” DuBoff said.

“One of our focuses was to develop a great fitness area for the residents,” said Jack Linefsky of Value Cos., which manages 140 Mayhill.

While renters get fit with other renters on “health-club quality” equipment like the elliptical, perhaps saving on outside gym fees, Value Cos. gains in being able to attract tenants in a sometimes saturated market.

“The [fitness] room is so successful, we’re considering expanding to include other equipment,” said Linefsky, director of operations.

At AVE by Korman Communities in Clifton, much thought went into designing a gym where renters would really want to work out, said president Lea Anne Welsh. This gym has a cardio

room overlooking the pool and a strength-training room with a view of the tranquility garden, both from 18-foot-tall windows. The high ceilings were designed to energize residents as they enter the gym, Welsh explained.

Personal training and massage therapy are available here just like at a health club. And if it seems like AVE employees are promoting fitness to the tenants, they are.

“We want people to take advantage of everything,” Welsh said. “They’ll be more likely to stay and not move out if their workout buddy is a floor away. It helps to create a sense of community.”

If you have such a fitness center, Rowley said, “The whole key to maximizing your workout in a fitness center at an apartment complex is to have a plan of action.”

And, of course, leave those excuses behind.

140 Mayhill, the luxury rental community from Value Companies in Bergen County’s Saddle Brook Township, was honored during the New Jersey Apartment Association’s 2009 Garden State Awards program.

The collection of 158 one-and two- bedroom rental homes was distinguished as “Best Managed Mid/High Rise Building Built After 2000 – Over 100 Units” by the organization of apartment owners, managers, builders, developers and those involved in allied industries.

The Clifton, JN.J.-based company received the honor during a ceremony recently held at the Hyatt Regency Hotel in New Brunswick.

“We’re thrilled to receive this award from our industry peers,” said Jack Linefsky, director of operations at Value Companies. “It is a fitting tribute to the superb team of professionals we assembled and have on staff to develop, lease, manage and maintain this special rental community.”

Just nine months after its debut, 100% of the community’s homes have been leased under the direction of The Marketing Directors, Inc., the marketing and exclusive leasing agent for 140 Mayhill.

November 23, 2009

Heating up the market
Multifamily properties offer multiple benefits to property owners
by SHANKAR P.

More investors are finding multifamily portfolios attractive, as they bring robust occupancies and should feel the effects of economic recovery faster than other commercial real estate property types, executives said.

Increasing investor interest in the “strong” multifamily market “is a trend,” said Jose Cruz, executive director in charge of multifamily sales at real estate services firm Cushman & Wakefield, in East Rutherford. However, although capital is available to fund that investor appetite, the deal flow is slow, as not all institutional investors have returned to the market.

Cruz said one Morris County apartment portfolio of 145 units, valued at about $25 million, attracted 26 bids, with more than 41 investors physically inspecting the property. The deal fell through after the property’s owner decided to hold off the sale: “The demand is the real story here,” he said.

Cruz also has organized nearly 30 investor tours so far for a 400-unit apartment complex in Essex County’s Belleville that’s priced north of $50 million.

Occupancy rates average 95 percent for multifamily properties in the state, compared to levels between 85 percent and 88 percent in early 2007, Cruz said. That’s been helped by the government-sponsored agencies of Fannie Mae and Freddie Mac, which are ensuring credit by actively securitizing home mortgages, he said.

The credit tightening that followed the subprime crisis will drive more demand to rental housing if employers resume hiring, which could start late next year, said Ronald Ladell, vice president of development at AvalonBay Communities Inc., in the Iselin section of Woodbridge. The luxury apartment owner boasts a 96 percent occupancy rate across nearly 3,900 units in the state, he said.

Jon Moore, vice president of development at Clifton-based Value Cos., an investor and developer of multifamily properties, is cautiously optimistic. His company has 2,300 units in five counties; occupancy rates range between 92 percent and 100 percent at those developments, he said.

Ladell said New Jersey appears ready to cash in on the economic recovery and the jobs that would follow. For one, he said, the state’s incoming governor and a re-energized Legislature are expected to launch new economic stimulus programs in the coming months.

Secondly, Ladell predicted that echo boomers (those between 20 and 30 years old) “will look for rental housing more than for for-sale housing.” Cushman & Wakefield’s Brian Whitmer wrote in his firm’s Fall 2009 Multifamily Overview report, “Young mobile corporate professionals will also gravitate towards this choice, as job uncertainty will persuade them from planting permanent roots with a house.”

AvalonBay now feels encouraged to start construction on a West Long Branch project with 180 apartment units, Ladell said; the company has another six to 10 development projects on its drawing board.

Moore is waiting for the market to get better before Value starts a shovel-ready project for 150 condos in Jersey City’s Paulus Hook section, he said.

“Historically, [multifamily] has been proven to be the first sector to recover; it is a more flexible option than single-family housing is,” Moore said. But “the rental market may be challenged for the next couple of years, and may take until 2011-2012 to get back to levels seen in 2007.”

Layoffs in the financial services and pharmaceutical industries hurt the state’s rental housing market, but landlords have kept vacancies low by offering concessions on rent, security deposits and amenities, according to Cushman & Wakefield’s Multifamily Overview report.

Land constraints also kept vacancies low in the Hudson Waterfront — the region that was the epicenter of the multifamily housing boom in the past decade, the report said.

Ladell said that in addition to jobs growth, 2010 will also bring supply constraints in rental housing. Multifamily housing rental starts nationally averaged 215,000 annually between 2004 and 2007, but are projected at only 70,000 next year, he said.

In New Jersey, there were fewer than 1,500 multifamily rental starts this year, and there will be fewer next year “unless some of the stalled larger redevelopment projects rejuvenate themselves, despite the continued uncertainties,” Ladell said.

Meanwhile, the investment sales market for multifamily properties waits for more institutional investors, like pension funds, to demonstrate interest in the sector, Cruz said.

“They see more positive signs, [but] say they will stay out for a couple of years before they begin writing their investment checks,” he said.

November 22, 2009

BY DONNA ROLANDO

If your holiday shopping is already done and you don’t have to cook the turkey this year, you might be in a position to take advantage of potential fall and winter bargains in the rental market.

Renters might find their bargain listed in the daily newspaper as a “fall special,” as Kings Arms Apartments in Wayne is doing, or they might make their own opportunity through sharp negotiating in this renter’s market. Either way, doing your homework could yield wallet-friendly results.

“There’s fewer people looking. That’s why fall and winter months are more affordable for people,” said Elaine DiPaolo, broker at Century 21 Gold Properties Realty in Totowa.

“With the holidays, November and December are stagnant months unless someone is relocating,” DiPaolo said. A landlord could be looking at vacant apartments staying vacant for three months. It’s not until January [after New Year's] that apartment searches pick up again.

Rather than lose money on a vacancy, landlords may be willing to offer a bargain, perhaps shaving $50 to $100 off the monthly rent, DiPaolo said.

On a high-end apartment, she said one renter recently sliced $300 a month from the rent by paying six months upfront.

“We find winter is when there’s the least number of people [looking for apartments]. People don’t want to move over the wintertime,” said Rebecca Axelrod, a representative for Kings Arms Apartments, which runs specials in all four seasons.

David Foudy, sales representative for Weichert Tenafly, agreed that winter could mean savings for tenants. But he added that bargains can also be found when school is in session, September through May, when the rental market slows in some towns. With the “overabundance” of rentals in northern New Jersey, Foudy said not all bargains depend on the season.

Other ways to score an affordable apartment in tough times include the following:

– “Keep your checkbook with you,” says move.com, an online rental resource. “Good places do not stay on the market long.”

– “How big is that closet?” — If your apartment is short on closet space, it may mean having to rent a storage unit. It’s better to find a place with enough storage for you and your stuff.

– Lengthen that lease — “Oftentimes, if you sign a lease longer than the typical 12 months, a landlord will lock in the rate beyond the first year so you would save on future years,” said Jon Moore of the Value Companies, a Clifton developer, owner and manager of 3,500 rental homes, including 140 Mayhill in Saddle Brook. “They could save 3 to 5 percent in the second year.”

– Care for your car — Parking should not be an afterthought in your apartment search. Will you have to rush home to catch that prime parking space, feed parking meters or pay for a secured parking lot? Factor that into the real cost of your apartment.

– Working out for savings — “If going to the gym is part of your daily regime, consider looking at apartments or housing complexes with a gym located on the property,” advised Peggy Abkemeier, president of Rent.com. “Some properties might charge a small monthly fee to use the gym, while others will include the fee in the rent. Regardless, it will likely be cheaper than paying for a gym membership somewhere else.”

– Just business — Luxury apartments often offer a business center, which can create the opportunity to work at home from time to time, cutting back on commuting costs.

– What’s included? — Tenants may find savings when utilities are included in the rent. But do the math, DiPaolo said, because sometimes landlords just tack these costs onto the rent. Since heating costs are seasonal, a tenant doesn’t want to get stuck paying for his heat 12 months a year.

– Keep your eyes open — Landlords looking to draw in tenants may offer a variety of concessions, such as one month’s free rent.

– Consider your commute — An apartment close to your job or public transportation can be light on your gas tank. While many city workers choose to live in the suburbs to save on rent, Abkemeier said, “Sometimes it is cheaper to live in the big city and forgo additional transit costs.”