West Bank Apartments at 181 River Road in Nutley — Courtesy: Gebroe-Hammer Associates
By Joshua Burd
Gebroe-Hammer Associates is touting the recent completion of multifamily asset sales valued at $164 million, with momentum expected to continue in New Jersey through the end of 2020.
The Livingston-based brokerage firm said investors continue to favor the apartment sector and its resilience during the pandemic. That was reaffirmed during September and October, when its team closed the sale of more than 1,030 units from northern New Jersey to the Philadelphia suburbs of southern New Jersey.
According to Gebroe-Hammer, the appetite from buyers stems in part from the rental market’s pre-pandemic fundamentals.
“As could be expected, there was a slight pause in the spring as the virus rapidly swept through the Northeast in its earliest days,” said Ken Uranowitz, the firm’s president. “However, a vast delta persists between a continued industry undersupply and strong demand — not to mention a remain-in-place tenant philosophy and a prevailing investor mantra of ‘people always need a place to live’ — that have kept a significant majority of deals on track to close and a steady flow of assets coming online, both on market and off market.”
Gebroe-Hammer on Friday detailed its recent apartment sales, which included urban submarkets of Essex and Passaic counties, the Jersey shore region and Burlington County. The company cited data from Reis and Moody’s Analytics, which found that North Jersey’s building-dense apartment stock during the pandemic has fared better than major metros like New York City, where high rent and small living space has prompted a migration to the suburbs.
It also pointed to North Jersey’s diversity with respect to submarkets and housing types.
“In particular, New Jersey has attracted an influx of former city dwellers seeking to relocate so they can have more square footage, be near outdoor spaces like parks and beaches and take full advantage of lifestyle services in the immediate and surrounding area — all at a cost savings,” Uranowitz said. “This migration is padding the tenant pipeline and will continue to do so as more companies adopt the work-from-home model over the long term — and perhaps even permanently. In terms of performance, overall occupancies are holding steady and rent payments are, for the most part, not significantly lagging — both good signs the trajectory will continue to inch upward throughout 2021 and beyond.”
The veteran broker added that Gebroe-Hammer has several deals in its pipeline that are slated to close before year-end.
“This surge in deal-closing velocity mirrors fourth quarters of the recent past — when investors streamline their efforts to finalize deals before the start of the new year and sellers opt to take advantage of calendar-year tax benefits,” Uranowitz said.