Yardi Matrix: Baltimore’s Downtown Surge
- Dec 28, 2016
Despite the ongoing revival of the downtown area, growth in Baltimore’s multifamily market remains weak compared to nationwide metrics. Yet benefiting from demand in core submarkets and the proximity to Washington, D.C.’s more dynamic but less affordable market, the metro continues to display stable fundamentals, with rents up 3.3 percent year-over-year.
Anchored by its universities and health-care providers, the metro has a consistent talent pool of highly skilled workers. Recording positive population growth for the better part of the last decade, Baltimore is perceived as a safe market by both investors and developers. Several large projects—including the 3,100-acre Tradepoint Atlantic industrial park, the $1.1 billion Harbor Point development and Sagamore’s $5.5 billion Port Covington project—highlight the city’s ability to diversify its economy and use the demographic shift as a long-term booster.
The commercial development pipeline mirrors the area’s multifamily market, as Baltimore is on track to top the 2015 level of new stock. The metro is also expected to exceed last year’s transaction volume of $1.4 billion, bringing a new cycle record. With 2,700 units completed year-to-date and an additional 30,000 in different stages of development, Baltimore is likely to keep demand in check due to its consistent pipeline. Yardi Matrix forecasts a 2.8 percent rent growth for 2016.