NEW YORK CITY—Our latest look at investment trends over the past decade and a half examines retail and multifamily sales activity. Like their counterparts, investment volumes for sectors ebbed and flowed along with the economy. Tracking both asset classes concurrently, however, shows that dynamics for retail and apartment space run relatively parallel.
Diving deeper into the data on investors in these sectors, another interesting finding comes up. In both retail and multifamily space—especially the latter—the groups that spent the most money over the past 15 years didn’t necessarily pick up the most properties, likely an indication of the differences in the quality of the assets these players target.
All of the information in the charts and tables below comes from Real Capital Analytics’ historical data, beginning in 2002, when the locally based firms started tracking the industry.
RETAIL
Retail has been on a steady pace since bottoming out in the third quarter of 2009 at $13.7 billion, accounting for 88.7 million units in 1,739 properties. At the second quarter of 2015, 7,205 properties comprised of 431.7 million square feet traded for an aggregate $90.3 billion. That surpassed the prior peak in investment volume in the third quarter of 2007, when 7,220 properties totaling 567.7 million square feet changed hands for a total consideration of $89.4 billion.
MULTIFAMILY
Few segments have been as volatile as multifamily over the past 15 years. Apartment investment volume ticked up steadily for four years, from $21.5 billion (344 million units in 1,549 properties) at the start of 2002, reaching at high of $107.5 billion (6,869 properties with 1.1 million units) at midyear 2006. Sales activity remained level until the year-end 2007, when it began a precipitous decline before hitting a trough of $17.7 billion (233,000 units in 1,795 communities) in the third quarter of 2009.
Volume steadily climbed upward after that, hitting $105.6 million (5,987 properties with 938,000 units) at midyear 2013 and then taking a slight dip six months later to $90.5 billion. By the end of the second quarter of 2015, apartment investment volume reached a new record of $129.6 billion, with 7,302 communities and 1.1 million units changing hands.
