Industry News | Week of February 10
HOT & RELEVANT TOPICS
Multifamily Developer Ordered to Pay $63 Million in Fraud Case
The multifamily industry is generally free of large-scale scandal, but the Robert C. Morgan case certainly qualifies. The New York real estate developer has been ordered to refund $63 million to the investors he is accused of pilfering as part of a $500 million mortgage scheme. Federal authorities claim that Morgan operated a Ponzi scheme by financing his real estate endeavors in part through the sales of securities to more than 200 investors. The U.S. Securities and Exchange Commission recently announced that it has obtained a court order forcing Morgan to return the money to investors. Read Ryan Smith’s article in Mortgage Professional America.
The Smart Home Tech Residents Want
Renters from across the country shared their smart home preferences and complaints in a recent Kingsley Associates report. Residents want sustainable energy features like car charging stations and efficient lighting preinstalled, alongside high-speed internet and built-in speakers. Several people also reported a demand for smart thermostat technology that can be controlled remotely. While smart home technology is popular, residents also want more instruction on how to use their smart home features, as well as the ability to opt out of the smart home platform altogether or pay only for what they use. Read the story in Multi-Housing News.
Stepping Up Their Screening Game
The tech revolution has changed the way multifamily organizations manage leads, refine pricing and embark on marketing campaigns. It is starting to shift the way the industry goes about its screening processes, as well. In an instant-gratification world, prospective residents want their applications to be processed instantly. And with the ever-evolving concept of self-guided tours, apartment managers have to protect themselves from the liability posed by an unaccompanied tour. These are some of the many reasons management teams are transitioning to an automated screening process that saves time while accurately screening for rental history, criminal background, credit and additional background. Read the story by Samantha Chalmers in UNITS Magazine.
IN THE NEWS
Longtime President of NMHC to Step Down
For the first time in two decades, the multifamily industry’s largest ambassador organization will have a new leader. Longtime president Doug Bibby announced in late Jan. that he will step down next year as president of the National Multifamily Housing Council. Bibby has been with NMHC since 2001 after a 16-year stint at Fannie Mae. As part of a prepared statement, Bibby said: “Representing the apartment industry has been one of the most fulfilling and gratifying experiences of my career.” The NMHC Board of Officers indicated they have engaged with search firm Russell Reynolds Associates to help identify new candidates to lead to organization. Read Jon Banister’s article in Bisnow.
Where Did Rent Increase the Most in the Past 10 years?
Apartment rents climbed steadily during the 2010s, and recent analysis by apartment rental listing service PropertyClub took a closer look at which markets saw rates climb by the largest percentage over the past 10 years. While major markets dominated the list, Aurora, Colo. led the way with a 73% increase, followed by Boise (53%), San Jose (49%), Denver (48%) and Oakland (46%). California had four markets in the top 20 and Colorado had three. Nine of the top 10 markets for rent growth were in western states. Seattle, Portland, Ore., Orlando, Reno and San Francisco rounded out the top 10. Read the National Real Estate Investor story.
Renter Satisfaction Levels Level off in Fourth Quarter
According to Kingsley Associates data, 78.4% of all renters nationwide reported good or excellent satisfaction levels with their renting experience in the fourth quarter of 2019. Renter satisfaction has now experienced a .1% drop in each of the past two quarters, which marks a leveling-off period following steady increases that began at the end of 2017. Boston was the top market for renter satisfaction, with 83.9% of renters claiming good or excellent satisfaction levels. Los Angeles saw the largest increase, with a 2.7% jump in renter satisfaction. Boston was also the top market for satisfaction with the value for amount paid, as well as renewal intent. On the opposite end, Atlanta and Denver saw decreases in both renter satisfaction and renewal intent. Read John Falco’s story in Multifamily Executive.