Upadtes on Rise48 Equity
Our staff continued to push rents across our portfolio in June 2021. Overall, we increased rents by about 3.5% as compared to prior quarter. Year over year, we’ve pushed rents 12.0% across our portfolio as result of burning off loss-to-lease, renovation premiums, and market growth. NOI for June 2021 ticked down slightly as compared to May 2021. Across the portfolio, we’ve increased our NOI by more than 26% year over year as a result of increased rents and cost control. We continue to perform well above our budgetary targets and don’t expect a slowdown anytime soon.
Over the past 5 months, we’ve renovated more than 100 units across our portfolio with little to no slow down. We’ve stayed close to budget on all of the renovations and have not decreased the scope on any of the projects. We continue to renovate to a platinum finish for all units and haven’t seen any pushback on the rents that we’re charging prospective residents.
In the video below, our CEO, Zach Haptonstall, walks us through clubhouse renovations that we’ve made at Rise Downtown Mesa.
Phoenix MSA Update
At the risk of sounding like a broken record, Phoenix Metro continued to lead the nation in rent growth. The Phoenix Metro experienced a year over year rent growth of approximately 17.0%. Month over month, rents increased more than 2.0% in the Metro with no slowdowns expected. Yardi expects rents to grow by 8.7% in Phoenix which remains the #1 Metro in the nation for rental growth.
Northmarq recently released the Greater Phoenix Multifamily Q2 2021 Market Report. The firm expects rent increases to slow down over the H2 2021 with an overall projection of rental increase of about 16%. Net employment is also expected to increase by 6%. Physical vacancy is still expected to remain just above 4% as absorption continues to outpace supply.
A surge in demand and a lack of available supply resulted in a record-setting period of rent growth in the Phoenix multifamily market in the second quarter. Demand was fueled by a surging local labor market and in-migration from neighboring areas. Apartment construction is picking up, which should help bring supply and demand more closely in balance.
Rise48 Equity has completed $289,201,000 in total transactions since 2019, and currently has $249,201,000 of Assets Under Management, all in the Phoenix MSA.