Multifamily Construction Decline
Commercial Observer
Connecting and informing industry leaders of trends and individuals defining the global commercial real estate landscape
California suffers like most of the country from an acute housing shortage. So, fresh figures showing a decline in multifamily construction starts in America’s most populous state are not good news. Also for today: Officials have selected a start date for tolling most motorists driving into Manhattan’s central business district.
— Tom Acitelli, Deputy Editor
Driven by High Interest Rates, Calif. Multifamily Construction Dips to 10-Year Low
Demand for housing in California is higher than ever, yet tenants there likely won’t see enough new supply anytime soon. Plans for new multifamily developments plunged 22 percent in the first quarter this year compared to the first quarter of 2023, according to the O.C. Register, which cited data compiled by the St. Louis Fed. Approved California permits for the first three months accounted for just 8,972 new units, the slowest quarter for new plans since 2014, per the Register. Meanwhile, nearly 160,000 units were under construction between 2021 and 2023, which at the time was the most voluminous stretch of multifamily construction since 2004 to 2006. The volatile economy is likely to blame for the decline in development, with the Federal Reserve signaling earlier this month that it will refrain from lowering interest rates until later this year due to stubbornly high inflation.
领英推荐
Check out our newest Deals of the Week, featuring the top commercial real estate transactions at a glance — plus a deep dive into the key players behind each transaction.
Congestion Pricing to Officially Start in Manhattan on June 30
The Metropolitan Transportation Authority (MTA) has settled on an exact date for the start of congestion pricing, according to multiple outlets. June 30 is when cameras mounted on gantries will begin charging drivers at least $15 to enter Manhattan below 60th Street, a plan that has been moseying through government bureaucracy since 2017. The MTA placed June as a ballpark start date in March, when the agency’s board approved the Traffic Mobility Review Board’s recommendations for the toll. The plan will levy between $24 and $36 on most trucks entering the congestion zone and most standard drivers $15.
Enjoying these stories on all things CRE? Unlock unlimited access to our content with a subscription. And for a daily version of this newsletter, sign up here.