Apartment Investor Academy Ventura County Apartment Market Update Dawn Dyer, President Dyer Sheehan Group, Inc. Ventura, CA (805) 653 ‐ 8100 dawn@dyersheehan.com February 23, 2011
Why Apartments? Why Apartments? � Strong Fundamentals � Apartment Recovery Leading Job Growth � The Housing Market Collapse & Credit Crisis � Demographic Trends Favor Multi-Family � Lifestyle Choices � The Greening of America � Strong Economics � Supply Constraints Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
The Benefits of The Benefits of Multi ‐ ‐ Family Housing Family Housing Multi � Efficient Use of Scarce Land Resources � Provides Workforce Housing � Promotes Diversity in Communities � Revitalization of Downtowns & Greyfields � Supports Job Retention � Reduces Commute Times Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Housing Crisis & Mortgage Meltdown Housing Crisis & Mortgage Meltdown � New Demand from those who Lost or Bailed � Changes in Consumer Psyche � Tougher Mortgage Requirements � Affordability � Homeownership vs. Rent & Invest Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Demographic Trends Demographic Trends � Generation Y � Aging Boomers � Single Person Households � New Americans � Alternative Family Structures Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Lifestyle Choices Lifestyle Choices � Live/Work/Play � Eco ‐ Friendly � Lock and Leave Convenience � Mobility � Freedom from Responsibilities of Owning Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Economics of Housing Economics of Housing � Job Growth for 20 ‐ 34 Year Olds � U.S. Housing Policy � Pent ‐ Up Demand (Renters & Investors) � Affordability � Recession ‐ Proof � Elasticity � Flight to Quality Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Apartments Provide Safe Harbor Apartments Provide Safe Harbor with Upside Potential with Upside Potential � Basic Commodity Item � Short ‐ Term Leases � Low Vacancy During Recession � Strong Demand Factors � Rent Appreciation Anticipated � Opportunities to Reposition � Benefits of 1031 Exchange � Leverage Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Update on Apartment Financing Update on Apartment Financing Michael I. Orman EVP/Chief Operating Officer County Commerce Bank 2400 E. Gonzales Road, Oxnard, CA 93036 3260 Telegraph Road, Ventura, CA 93003 Phone: (805) 477 ‐ 7611 Fax: (805) 477 ‐ 0638 morman@CountyCommerceBank.com www.CountyCommerceBank.com Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
2010 Multi ‐ ‐ 2010 Multi Family Sales Family Sales Parker Shaw Multi ‐ Family Sales Dyer Sheehan Group, Inc. February 23, 2011
2010 Ventura County Multi ‐ Family Transactions 2010 Sales w/o Serenade All 2010 Sales Total Transactions 17 16 Total Sale Volume $136,001,150 $54,501,150 Average Sale Price $8,000,068 $3,406,322 Average Cap Rate 6.29% 6.37% Average Price/ SF $146.62 $145.18 Average Price/Unit $114,631.29 $109,061.37 Total Units 896 496 Average # of Units 53 31 Average Bldg Size (SF) 51,646 24,828 Average Yr Built 1964 1961 Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
2010 Ventura County Multi ‐ Family Transactions 2010 Sales w/o Serenade All 2010 Sales Total Transactions 17 16 Total Sale Volume $136,001,150 $54,501,150 Average Sale Price $8,000,068 $3,406,322 Average Cap Rate 6.29% 6.37% Average Price/ SF $146.62 $145.18 Average Price/Unit $114,631.29 $109,061.37 Total Units 896 496 Average # of Units 53 31 Average Bldg Size (SF) 51,646 24,828 Average Yr Built 1964 1961 Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Ventura County Total Transactions 60 50 40 30 20 10 0 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09 2010 Yearly Transactions 10-Year Average Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Ventura County Average Cap Rate 9.0% 8.5% 8.0% 7.5% 7.0% 6.5% 6.0% 5.5% 5.0% 4.5% 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09 2010 Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Ventura County Average Price Per Unit $220,000 $200,000 $180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09 2010 Yearly Average 10-Year Average Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Parker Shaw Multi ‐ Family Sales Dyer Sheehan Group, Inc. Parker@DyerSheehan.com February 23, 2011
Ventura County Vacancies 6.00% Average Monthly Rent in Dollars 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Average Weighted Vacancy Rate Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Average Ventura County Rents $1,600 $2.00 $1.80 $1,400 $1.60 Monthly Rent in Dollars $1,200 $1.40 Rent in $ oer SF $1,000 $1.20 $800 $1.00 $0.80 $600 $0.60 $400 $0.40 $200 $0.20 $0 $0.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Average Monthly Rent Average Rent in $ per SF Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Average Two Bedroom Apartment Rents Ventura County, January 2011 $1,700 $1,600 Average Monthly Rent in Dollars $1,500 Thousand Oaks/Westlake Village $1,400 Oxnard/Port Hueneme $1,300 Combined Areas Simi Valley Camarillo Moorpark $1,200 Ventura $1,100 Ojai Valley Santa Paula $1,000 Fillmore $900 $800 Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Supply Constraints Supply Constraints � Access to Development Capital � Land and Production Costs � Limited Land Zoned for Multi Family � Entitlement Hurdles, Delays, and Litigation � Fees, Infrastructure, and Offsite Improvements � Parking Standards � GOD, SOAR and MS4 � NIMBYs and BANANAs Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Ventura County Building Permits 5000 4500 4000 Total Permitted Units 3500 3000 2500 2000 1500 1000 500 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Single Family Permits Multi ‐ Family Permits Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Multi- -Family Investment Family Investment Multi Outlook Outlook � Strong Market Fundamentals Continue � Supply/Demand Imbalance � Most Affordable Housing Type � Low Vacancy Rates � Changing Demographics � Opportunities to Add Value � Strong Upside Potential in Rents Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
Questions? Dawn Dyer Dyer Sheehan Group, Inc. Dawn@DyerSheehan.com Apartment Investor Academy | Ventura County Apartment Market February 23, 2011
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