California CRE developers show improving market sentiment

The California multifamily market should have low vacancies in the coming years.

The California commercial real estate market may strengthen in the view of many developers in the coming months and years, and this could directly affect property management companies, as the multifamily sector should lead the pack.

Multifamily development in the Golden State may increase in the coming years, as there is a rising demand for apartments at this time, a report from Allen Matkins and UCLA Anderson Forecast explained. The vacancy rate for apartments could drop to 4.5 percent, as well.

“We are still seeing strength in the market today,” said John Tipton, real estate department partner at Allen Matkins. “More developers have been taking notice that market conditions now justify demolishing older structures, and taking steps to build new ones. This is a very significant indication of commitment, not only of capital, but to the strength of the development cycle.”

Many people in the state want to move from homes to multifamily properties, the groups’ California Commercial Real Estate Survey explained. Additionally, many young people who are just starting out in the working world are seeking apartments that are located within close proximity to their offices, which are often located in downtown metropolitan areas.

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