Northville, MI | Midwest Multifamily | Investment Highlights

Market Pulse (Q2 2024)

The US Federal Reserve continues to battle inflation by using monetary policy in response to the increase in costs that the US Economy has experienced over the past 4.25 years. Generally, the cost of goods is directly influenced by the circulation of currency in relation to a product. Since the start of 2020 (approximately 4.25 years ago), the amount of USD in circulation has risen by approximately 30.4%. Comparing this to historical data, we can observe the time it took for a similar ~30.4% increase in the past.

• Period 1- January 2008 to December 2011 3.9 years

• Period 2- December 2011- September 2015 3.75 Years

• Period 3- September 2015- January 2020 4.42 Years

The average over this 6 year period is 4.1 years.

The chart below sourced from the Federal Reserve Economic Data demonstrates that the most substantial increase over the past 4.25 years occurred in the year 2020. However, since then, the percentage change has significantly decreased, indicating that the adjustment to the federal monetary policy is effectively achieving its intended purpose.

Multifamily Market Report Q1 2024

The Michigan State Housing Development Authority estimates that the state is short approximately 190,000 housing units. With only 2,807 units delivered in the trailing 12-month period, apartment supply remains extremely low. It is reasonable to conclude that occupancy, rent and absorption will continue on the current upward trend. Michigan needs more housing.

National Rent Projections:

According to recent projections from Axios and Costar, Detroit, Michigan is expected to be the top city for rent growth in the next 5 years. This can reasonably be attributed to the previously mentioned shortage of supply in this area.

Northville Downs Housing Development

As the housing shortage in Michigan continues to cause pain for residents, some cities are looking to housing developers to help alleviate supply constraints. Recently, the City of Northville approved a project (with conditions) to redevelop a former horse racing track that sits on a 48-acre parcel near Northville's vibrant downtown. The owners of the racetrack have included plans to relocate horse racing activities to a 128-acre parcel in a nearby township.

The Northville Downs $250M redevelopment project plans include a variety of residential housing, mixed-use commercial space and neighborhood parks. The development is set to take place at 301 S Center St. Northville MI.

The Berkadia Investment Sales team has identified multifamily investment opportunities in Michigan and Ohio from $900k to $130M. If you're interested in learning more about these investment opportunities, feel free to reach out to your trusted Berkadia advisor. Let's discuss how you can take advantage of this market! Click here to schedule a call with me.

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