Multifamily investing in Central Pennsylvania
Multifamily construction is starting to come on strong and Central Pennsylvania stands to benefit in the coming years.
In 2011, the apartment industry spent $14.8 billion on construction. Last year, that number jumped to $21.3 billion, according to the U.S. Census Bureau.
Where do we go in 2013? I’d say up.
Last week, I met with Brian Kobularcik, vice president of development for Berks County-based Metropolitan Development Group. He was in the area scouting future apartment projects.
Metropolitan is in the process of acquiring the land and hopes to break ground by late summer or early fall on a 200-unit market-rate apartment complex along Route 39 in West Hanover Township.
In addition to this Manada Hill Apartments project, the company is planning a 144-unit apartment complex off Interstate 81 in Susquehanna Township, breaking ground on 160 units in Berks County and building 120 units in Elizabethtown.
“We have about 620 units in the pipeline over the next three years,” Kobularcik said.
And there is potential for an adjacent second phase in Elizabethtown at the company’s Featherton Crossing complex off Route 283, he said.
That’s somewhere north of 750 units in all. With the average unit cost being $95,000 to $105,000 from concept to completion, according to Kobularcik, that’s roughly $75 million in new construction right there.
And that’s one developer who has an interest in expanding the MF market in Central Pennsylvania. That’s also rent that averages $850 to $925 for one- and two-bedroom units — a significant contribution to the local economy.
In a February report on MF nationally, the National Multi Housing Council and the National Apartment Association said that apartments and their residents contributed $1.1 trillion to the U.S. economy in 2011, supporting 25.4 million jobs.
And that was in a year when MF completions were down — just 130,000 new units added. The average prerecession number was around 270,000 completions, according to the report.
The industry spent $67.9 billion in 2011 to operate and improve 19.3 million apartments nationally, which was more than four times the amount spent on construction.
Courtesy of the Central Penn Business Journal. Read the full article here: