McGraw Commercial Properties manager, Neil Dailey, recently sat down with our multifamily property team to learn more about how the current situation is affecting the market. Team members, Ryan Gorman, Carey Velez and Jeremy Smith joined to weigh in on what they are seeing take place in the Multifamily market right now. Here are the highlights of their conversation.
Market Confidence Among Owners
Even though every sector of the economy has been impacted by the pandemic and resulting lockdowns, there is still a high level of confidence in the multifamily market from an owner perspective. Most owners in McGraw Commercial Properties’ service area (Tulsa, Oklahoma City, Northwest Arkansas, parts of Missouri and Southern Kansas) are still seeing 98%-100% rent collections compared to previous months.
Our region’s lower cost of living seems to be allowing tenants to shift budgets to accommodate their current situation. The COVID-19 situation has caused the multifamily industry to make certain adjustments such as the implementation of payment plans, deferred payment plans, the way tenants and property staff interact, and general day to day operations.
Specifically, in our regional market, the COVID-19 crisis has actually caused many tenants to feel that continuing to rent is the best option for them. With so much uncertainty, purchasing a home carries a level of risk that remaining in a rental situation does not. Overall retention and interest in units has actually increased during this time.
Even as Oklahoma begins to slowly re-open, we expect that trend to continue throughout this period of economic and public health uncertainty.
Current Investment Opportunities and New Developments
With interest rates at record lows, lenders and banks are still giving out loans, but the bar for entry has gotten steeper. There are more financial requirements and hurdles to overcome, and the terms of the agreements are not as good as they were before when it comes to investment property.
As far as new developments are concerned, things are still moving forward at relatively the same strength as before.