AUSTIN, TX – Rastegar Property, a vertically-integrated real estate investment firm focused on value-add and development in all asset classes across the United States, announced its acquisition of a 36-unit multifamily property at 902 Romeria Drive, located between North Lamar Boulevard and Grover Avenue in the North-Central Austin neighborhood of Brentwood.

The complex averages 490 square feet per unit, and is ideally situated between the major thoroughfares of I-35 and the Mopac Expressway. Rastegar plans to fully renovate the property with new flooring and tile, cabinets, countertops, stainless steel appliances, interior and exterior paint, windows, siding, roofs, landscaping and covered parking. Brentwood is recognized as a rapidly growing, walkable neighborhood with convenient access to downtown Austin, which offers jobs, restaurants, higher education and parks.

“Our team continues to identify properties in areas of high growth that are not only ideal for for Austinites for years to come, but reflect the city’s tradition and artistic values,” said Ari Rastegar, CEO of Rastegar Property. “902 Romeria in Brentwood is a fantastic example of that strategy, a location that makes sense for young professionals – Austin’s fastest growing demographic – starting or likely soon to start families, in an area whose culture is steeped in arts, music and a tantalizing restaurant scene. We look forward to continued development in this region.”

“North Central Austin is one of the city’s fastest growing areas and home to Austin’s ‘Tech Corridor’, which includes Amazon, Indeed, Facebook and Homeaway, to name a few,” said Jim Young, Managing Director at Newmark Knight Frank. “Romeria also offers access to some of Austin’s finest retail and entertainment venues, making it ideal for the exploding population of young professionals.”

“Just north of the triangle and right in the mix, this Romeria complex screamed opportunity,” said Dustin Mehaffey, Founder of Austin Mindset Realty and Investment Sales Coordinator at Rastegar Property. “The volume of people moving to Austin to pursue career opportunities has opened doors for us and as that continues, we will continue our bullish outlook.”

In 2018, the Brentwood neighborhood was ranked among the “Top 20 ZIP Codes with the Highest Increase in Millennial Share” in the country. This trend, coupled with the area’s reputation as being art and music friendly, represent key indicators for growth that Rastegar Property believes will continue to attract families and young professionals to the region.

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NEW YORK, NY – New construction starts went 5% lower in September to a seasonally adjusted annual rate of $774.1 billion, according to Dodge Data & Analytics. This marks the second consecutive monthly decline in construction starts. By major sector, nonbuilding construction fell 13% in September, while residential construction dropped 6%. On the plus side, nonresidential construction starts rose 1% during the month aided by the start of a large manufacturing project.

The September statistics pushed the Dodge Index lower to 164 (2000=100) compared to 173 in August, marking the lowest reading for the Index since May. Despite the month’s decline, the Index remains close to its 2019 average of 167.

Through the first nine months of 2019, total construction starts were 3% lower than 2018 due to pullbacks in both residential and nonresidential construction starts. But, nonbuilding construction starts are 4% higher year-to-date as a result of strong gains in electric utilities/gas plants.

“Large projects continue to make their presence felt in the monthly statistics, sometimes obscuring underlying trends,” stated Richard Branch, Chief Economist for Dodge Data & Analytics. “Nevertheless, construction starts have certainly throttled back in 2019 due to mounting uncertainty over the country’s economic health.”

Nonbuilding construction totaled $187.0 billion (at a seasonally adjusted annual rate) in September, a 13% drop from the previous month. Starts in the miscellaneous nonbuilding category declined 32% from August to September, while highway and bridge starts fell 12%, and electric utility/gas plant starts lost 10% over the month. On the plus side, environmental public works (drinking water, sewers, hazardous waste, and other water resource projects) increased 12% in September.

The largest nonbuilding construction project to get underway in September was the $994 million Cotton Belt “Silver Line” Rail Corridor, a 26-mile rail line extending from Dallas-Fort Worth Airport in Dallas TX to Shiloh Road in Plano TX. Also starting in September was the $720 million (480 MW) Maverick Creek Wind Farm near Eden TX and a $629 million reconstruction of a 5.5 mile stretch of I-75 in Troy MI.

Through the first nine months of 2019, nonbuilding construction was 4% higher than in the same period of 2018 at $151.3 billion. Starts for electric utilities/gas plants were 132% higher year-to-date and environmental public works were up 2%. Miscellaneous nonbuilding starts, but, were 24% lower through nine months and highways and bridges were down 7%.

Nonresidential building starts inched 1% higher in September to $287 billion (at a seasonally adjusted annual rate). The increase was a result of a 243% increase in manufacturing construction due to the start of a large automotive plant. Commercial construction starts fell 14% over the month as the office sector pulled back from a very strong level of activity during the prior month. Institutional construction starts fell 1%.

The largest nonresidential building project to break ground in September was a $969 million consolidated rental car facility at Los Angeles International Airport in Los Angeles CA. Also getting under way was the $900 million Fiat Chrysler Assembly complex in Detroit MI and the $750 million Exxon Polypropylene Production plant in Baton Rouge LA.

Year-to-date through September, nonresidential building starts totaled $215.0 billion, a 4% decline from the first nine months of 2018. Commercial starts were 6% higher pushed forward by the office, warehouse, and parking categories. Institutional construction starts were down 3% through nine months, with all major categories posting setbacks. Manufacturing starts were a sharp 39% lower year-to-date.

Residential building fell 6% in September to $300.0 billion at a seasonally adjusted annual rate. Both single family and multifamily starts fell 6% from August to September. The largest multifamily construction project to get underway in September was the $228 million Lakeshore East – Cirrus Apartment Tower in Chicago IL. Also breaking ground during the month was the $192 million Greenpoint Landing in Brooklyn NY and the $150 million The Eleven Condo project in Minneapolis MN.

Through the first nine months of the year, residential construction starts were 6% lower than in the same period of 2018 at $238.3 billion. Single family starts were down 4%, while multifamily declined 11% year-to-date.

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SEATTLE, WA – A wise man once said that nature abhors a void, but it seems that everyone else does, too—especially those of us in the multifamily housing industry. Up until recently, developers have turned to master lease agreements with small-term rental (STR) providers to help fill empty apartments during the lease-up phase. But, many industry innovators are now attempting a different solution, with AvalonBay Communities, Inc. being one of those very companies. 

Recently, AvalonBay Communities partnered with WhyHotel to make a pop-up hotel solution to address this all-too-common issue. According to leasing experts, it generally takes between 12 and 24 months to completely fill an apartment building the size of AvalonBay’s Seattle property, the 24-tale, 275-unit Avalon Belltown Towers, with residents who meet the lease criteria and can pay the rental deposit. Even in a seller’s market, the lease-up period can have developers biting their nails and offering fantastic concessions just to seal the deal. 

While waiting for those blue-chip tenants to arrive, a pop-up motel blueprint allowed Avalon Belltown Towers to rent a percentage of the empty apartments to tourists, corporate travelers, and other upmarket transients. The hotel started operation with 50-rooms in the community during the month of September. A best-in-class fitness center, indoor and outdoor common areas, and cooking spaces were provided to guests, along with their apartment accommodations, like they would be to any long-term resident.

“We provide a new type of stay product that combines the spaciousness and comfort of a home-share rental with the consistency and service of a hotel,” clarified Jason Kamen, WhyHotel’s Vice President – West Coast Operations. “By operating a pop-up hotel out of the vacancies of brand-new luxury apartment buildings, we de-risk the lease-up phase. This provides significant early income and drives leases, which can help to make developers feel more comfortable introducing new properties to the rental market.”

The partnership brings new experiences for both AvalonBay Communities and WhyHotel for different reasons. For AvalonBay, it’s their first time using a hotel-based rental system on-premises; for WhyHotel, it’s the first pop-up hotel they’ve hosted on the West Coast. Even so, both partners reckon they have a winner in Avalon Belltown Towers, with the Belltown neighborhood being close to Downtown Seattle, Pike Place Market, and the Olympic Sculpture Park. According to Derek Bottles, Vice President of Development at AvalonBay, “The property is positioned to attract both long-term residents and WhyHotel guests, who want to be in the center of the energetic live, work, and play community of Downtown Seattle.” 

The pop-up hotel consists of brand-new, fully-furnished, and amenitized luxury apartments that offer the Seattle market an improved stay product for leisure and business travelers at a better value. This was certainly the experience of Steve Lefkovits, Executive Producer of Joshua Tree Conference Group, when he toured the property in early October. 

Lefkovits clarified, “I was blown away by the value proposition and the attention to detail of the WhyHotel team. They provide 24-hour access and check-in. The suite was immaculate and very tastefully furnished, and the location was fantastic.” He added, “I like that AvalonBay is experimenting with this new master lease concept. We’re already seeing the benefits: it generates new income, attracts small-term visitors and long-term prospects, and serves as a financial edge in a lease-up market.”

It’s no coincidence that the AvalonBay Communities and WhyHotel partnership is taking place in Seattle. Residents of the Pacific Northwestern city earn 34 percent more than the national income average, but the cost of living is also 48 percent higher than the national average. Looking towards the future, it will become increasingly vital for apartment owners and operators to consistently demonstrate the value proposition of their rentals. By maintaining a steady stream of visitors, who tell residents how lucky they are to be living in their community, AvalonBay Communities has come up with the perfect modern marketing and leasing strategy, because it harnesses the power of recommendations and of course, establishes the property’s value.

According to Kamen, “Seattle is the ideal city to test the waters of WhyHotel’s model. First of all, you have to consider that techcompanies, like Amazon and Microsoft, entice young employees, who are often fresh out of college and might not be able to afford something permanent, to go out to the city to pursue their dreams of working for huge tech. In addition, Seattle’s tourism industry has been booming— with statistics released by Visit Seattle last year that illustrated the city’s eighth consecutive year of record tourism.” When questioned if this blueprint would work elsewhere, Kamen responded, “We believe our model works well in most urban cores and stay markets anchored in strong business drivers, such as technology, government, or healthcare.”

Small term rentals will be discussed in-depth at the FLEX Conference. Attendance is limited. To register, visit flexrentals.org/registration

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