New Apartment Deliveries Increase Demand for Property Management

New apartment deliveries are creating more demand for property management companies. Research from CBRE estimates that the top 66 metros in the US will deliver a total of 300,000 new apartment units this year. That is a 15% increase over 2018 deliveries. Multifamily investment will also increase this year, with an expectation of more than $150 billion in multifamily investment. Opportunity zone funds will also fuel additional investment this year as well. New deliveries will mean two things for property managers: more competition at existing assets under management and new demand from developers for property management representation.

“New deliveries always mean an increase in competition, which can be good news for multifamily owners and for property managers who are able to be nimble and adjust their marketing strategies effectively,” Cindy Wick, regional VP at Western National Property Management, tells GlobeSt.com. “The key is to pay close attention to newly developed product and make strategic decisions on how existing properties will compete.” More affordable older product can still be a competitor for newly delivered assets, which are often significantly more expensive. Particularly in urban areas suffering from housing affordability issues, older-product is in high demand.

In addition, property management firms can analyze amenities or complete upgrades to a property to add competitive amenities. “Another strategy is to implement strategic upgrades that offer residents the amenities they want most,” says Wick. “For example, in many of the properties we manage, Western National Property Management has recommended convenience apps or pet amenities that require a relatively small capital outlay to set up and deliver strong return on investment as residents choose these properties.”