Although the pandemic rounded off a thriving decade for Portland and cut employment, the subway multi-family market continues to benefit from a steady influx of residents paid from the more expensive West Coast markets.
Still, there are hurdles like expiring eviction moratoriums, rental controls and limited supply, said Hollie Forsman, director of operations at Guardian Real Estate Services, based in Portland Apartment building news.
In the following interview, Forsman reveals the key trends and challenges currently shaping the Portland multi-family market.
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How has Portland’s multi-family landscape changed over the past year?
Forsman: Over the past year, the Portland multi-family market has shifted from one of the toughest times to some of the best conditions in recent history. In 2021, the rental market recovered with high demand and upward pressure on rents.
With the recently lifted eviction moratorium in Oregon, the focus is again on the collection of rents and the use of rental subsidies.
What are the main trends shaping Portland’s apartment buildings right now?
Forsman: Currently, the upward pressure on rents is reducing the availability of housing for the average tenant. A combination of persistent rental price regulation, inflation and overall low supply make it difficult to attract capital to our market.
In addition, the job market has narrowed and it is difficult to find candidates to fill real estate.
What does Portland have to offer investors?
Forsman: Portland remains one of the cheapest major rental markets on the West Coast. Through the ups and downs, Portland maintains a relatively stable market performance.
In addition, Portland offers a robust variety of industries including technology, manufacturing, and construction. When an industry takes a hit, like the hospitality industry during the pandemic, the diversity of the overall market keeps Portland strong.
Given the ongoing influx of migration, Portland remains an asset growth opportunity over time.
What types of properties are in most demand in Portland right now?
Forsman: Suburban real estate is the most popular. We’re seeing high demand for regulated, affordable properties like LIHTC and Section 8. In addition, value-added properties are in great demand.
Which areas of the metro are the most sought after now and why?
Forsman: The migration from core markets to suburban markets continues, with a large emphasis on Vancouver / Clark County, Beaverton and other submarkets. These areas, on average, offer larger housing, lower crime rates, and fewer urban problems.
How has the pandemic affected Guardian’s plans and operations? Have your business strategies changed since the health crisis began?
Forsman: The pandemic has led Guardian to quickly adapt and adopt new protocols for everything from PPE to remote work to rent collection. While our general business strategies haven’t changed, we have adjusted during the pandemic to focus on efficiency.
Our investments in technology have been critical in adapting to remote work, employee training, online payments and virtual tours. We also looked at staffing efficiency by using technology enhancements to accommodate managers and employees in multiple locations and outsourcing staffing to manage staff costs and availability.
What do you want to achieve in the subway this year?
Forsman: We have an ambitious development and acquisition pipeline with 800 units completing the capital and starting construction in 2021. Our management pipeline is also robust as we anticipate more than 500 additional units in the next 12 months and development projects will follow in the pipeline. Internally, our team is growing with currently more than 60 vacancies.