Investors Cash Chips in Las Vegas
Apartment construction slowed in 2016 to 2,000 new units, likely because of oversupply of single-family home rentals. But development looks promising, with more than 4,500 units under construction, according to Yardi Matrix.
By Anca Gagiuc
Las Vegas rent evolution, click to enlarge
Amid accelerated hiring, demand for apartments for rent in Las Vegas heightened in 2016. The city’s economy grew at a healthy pace, due to broad-based employment gains and an increasing population. The mining, logging and construction and the leisure and hospitality segments were the most active during the past year.
A record number of visitors passed through Sin City last year, contributing $25.5 billion to local tourism—a 16.3 percent increase from 2015. The Lucky Dragon Hotel and Casino opened in December 2016. Construction continues on Genting’s $4 billion Resorts World. The office market is expected to achieve a second consecutive annual increase in rents, further strengthening its performance. More than 100,000 square feet of space is slated for delivery in 2017. In Reno, Tesla Gigafactory has begun producing batteries and will employ several thousand people.
Multifamily fundamentals are strong: Occupancy for stabilized properties was 94.9 percent as of February. Apartment construction slowed in 2016 to 2,000 new units, likely because of oversupply of single-family home rentals. But the development looks promising, with more than 4,500 units under construction. Many of the new deliveries are focused in the Lifestyle segment, accentuating the city’s affordability issues. Transaction volume rose 50 percent year-over-year to $2.4 billion, marking a peak in the current cycle.
Read the full Yardi Matrix report.
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