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These 2 Cities Lead the List for the Most New Apartments

Hell's Kitchen may not sound like a particularly attractive landing spot for the young folk, but it's actually an urban hotspot.

The Clinton-Hell's Kitchen neighborhood in Manhattan is lucky number 13 on a new list from RENTCafé that ranks America's 50 largest cities by construction of new apartments.

The apartment search site is part of Yardi Matrix and used its data to parse out where the most apartments are being built. They determined that the 20 most-active neighborhoods for that kind of construction are mostly "hyper-urban," centrally located areas attractive to millennial and Gen Z renters. (Generally speaking, this includes people born from 1980 on. Millennials, in fact, now outnumber boomers.)

(Image source: Getty Images.)

Los Angeles and Atlanta have the neighborhoods with the most new units

RENTCafé says that there have been about 1.6 million new rentals built in the past five years nationwide. By state, the leaders are California, Texas, and New York, and by locality, by far the leader is downtown Los Angeles at 10,136 units complete, 39% of the total number built in the sprawling City of Angels in the past five years.

Here's a tabular look at the list RENTCafé built using Yardi Matrix data:

Rank

Neighborhood

City

Units Completed 2017-2021

% of City Total

1.

Downtown Los Angeles

Los Angeles

10,136

39%

2.

Midtown Atlanta

Atlanta

5,936

21%

3.

Hunters Point

Queens, New York City

5,423

53%

4.

Navy Yard

Washington, D.C.

4,953

22%

5.

Downtown Fort Worth

Fort Worth, Texas

4,630

28%

6.

Northwest San Antonio

San Antonio

3,962

16%

7.

Spring Valley

Las Vegas

3,919

43%

8.

South Loop

Chicago

3,516

14%

9.

Downtown San Jose

San Jose, California

3,511

58%

10.

Hollywood

Los Angeles

3,431

13%

11.

Downtown Brooklyn

Brooklyn, New York City

3,359

19%

12.

Downtown Miami

Miami

3,280

16%

13.

Clinton-Hell's Kitchen

Manhattan, New York City

3,189

19%

14.

Midtown-Edgewater

Miami

3,045

15%

15.

South Lake Union

Miami

2,979

12%

16.

Encanto Village

Phoenix

2,965

21%

17.

Uptown Charlotte

Charlotte, North Carolina

2,918

11%

18.

Waterfront Washington

Washington, D.C.

2,901

13%

19.

Washington Avenue-Memorial Park

Houston

2,897

8%

20.

East Village

San Diego

2,699

22%

The Great Migration goes both ways, yielding zones of growing opportunity

The idea of a "Great Migration" has taken hold during the pandemic, and it's certainly understandable that significant real estate investor attention and dollars have been directed to the suburbs and beyond. But there's a similar movement back in to the central cities, one that recent Fed analysis found is roughly balancing out the urban exodus.

Many of those moving into the central cities are, as mentioned above, millennials and Gen Zers attracted to the urban lifestyle, and the apartment industry is responding with new construction. Stock market plays here include major real estate investment trusts (REITs) such as AvalonBay Communities and Equity Residential.

There are others, too, such as the three covered in this piece by Motley Fool contributor Liz Brumer-Smith: "3 Apartment REITs to Buy Now."

Each REIT has its own mix of markets, and those wishing to specifically target the hottest neighborhoods might consider crowdfunding, too, and the tax-deferral opportunities presented by the Opportunity Zone program. Many of those zones encompass just the kinds of neighborhoods that are proving so attractive for new apartment construction and to the people looking to occupy trendy new digs.

Marc Rapport has no position in any of the stocks mentioned. The Motley Fool recommends AvalonBay Communities. The Motley Fool has a disclosure policy.


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