Apartment vacancies fall for 1st half in metro area

Home foreclosures spur sector, expert says

7/26/2011

Metro Toledo's apartment market experienced fewer vacancies as it reduced rents in the first half of 2011, an industry report shows.

CB Richard Ellis/Reichle Klein, a Toledo commercial real estate firm, said local vacancies for multifamily housing units dropped to 7.3 percent in June, compared with 7.7 percent at the end of 2010.

The average rent slipped to $595 last month from $602 six months earlier.

Harlan Reichle, senior managing director, said the Toledo-area rental market continues to be bolstered by foreclosures and declining sales in the local single-family housing market.

He noted that the market has had a reduction in rental incentives, such as reduced security deposits or free rent for the first month.

"Fewer and fewer properties are having to offer them to get their apartments filled up," he said.

Several northwest Ohio apartment complexes were sold in the first half of the year, about half of them by out-of-state investors, Mr. Reichle said.

That includes a portfolio of five Toledo complexes acquired last month by New York City-based real estate firm Kushner Cos. and two partners.

The complexes, which have a total of 1,100 units, were purchased for more than $12.9 million, according to Lucas County records.

The complexes were Abbey Run, Georgetown Village, Miracle Manor, Sunnydale, and Hunters Ridge in Toledo.

Mr. Reichle said outside investments in Toledo-area rental properties are a positive indicator for the local market.

"This demonstrates that investors from outside markets are willing to put their capital at risk here," he said.

Investors such as Kushner could upgrade or perform needed maintenance at local apartment complexes that were bought at discounted prices, Mr. Reichle said.

- Sheena Harrison