New apartment construction drives up metro Denver rents in 1st quarter

DENVER BUSINESS JOURNAL - The average rental rate for an apartment in metro Denver increased to $1,382 per month in the first quarter of 2017, up 5 percent from the same period of 2016, when rents averaged $1,315, according to the Apartment Association of Metro Denver.

The vacancy rate dropped to 5.7 percent in the quarter from 6.8 percent a year ago even as new apartments were completed. In the first quarter, 3,246 new units were completed, but net absorption, or how many units were leased in the quarter, was 4,664 across the metro area.

“Denver saw 3,246 new apartments delivered in the first quarter,” said Mark Williams, executive vice president of the Apartment Association of Metro Denver (AAMD). “That’s a new record for first quarter deliveries and more than in any other quarter in nearly 15 years.”

But those new apartments come with a premium price, which pushes up average rents across the board.

“We’re seeing average rents of $1,729 for apartments built since 2010,” said Teo Nicolais, a Harvard University instructor who specializes in real estate. “That’s 60 percent higher than the $1,079 average rents on apartments built in the 1970s. Adding 3,246 new apartments at that higher price point will, by itself, increase the metro-wide average rent figure.”

Read more at the Denver Business Journal: http://bit.ly/2o3POeI

© 2017 American City Business Journals.


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