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THE QUIET GIANTS: A NEW TAKE ON THE SUBURBS

MATT VANCE CBRE

LESLEY L ISSER

Invesco

DANIEL MAHONEY LaSal le Investment Management

3

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Let’s Talk About the Trends

BUILDING IN THE ‘BURBS BETHESDA (WASHINGTON, D.C.)

Source: Invesco

BUILDING IN THE ‘BURBS BETHESDA (WASHINGTON, D.C.)

Source: Invesco

SOME SUBURBS LOOKING MORE LIKE THE CBD ON BOTH AMENITIES AND NEW SUPPLY

Downtown L.A. Apartment Pipeline in Tysons Corner VA –

10 Miles from Downtown Washington

Apartment construction is ~20% of existing inventory in both submarkets. Source: LaSalle

WHAT IT REALLY MEANS TO BE URBAN (BOSTON’S NORTH END)

Live

Work Play Source: CBRE Econometric Advisors

THE LWP (LIVE, WORK, PLAY) INDEX FROM CBRE ECONOMETRIC ADVISORS

Source: CBRE Econometric Advisors

RENTS BY DENSITY LEVEL (DALLAS)

Nominal Apartment Rent ($/unit)

Source: CBRE Econometric Advisors, Axiometrics, Inc.; Q1 2017

RENTS BY DENSITY LEVEL (BOSTON)

Nominal Apartment Rent ($/unit)

Source: CBRE Econometric Advisors, Axiometrics, Inc.; Q1 2017

PRIVATE INSTITUTIONAL INVESTORS ARE TARGETING URBAN LOCATIONS (BUT NOT JUST DOWNTOWN CBD’S) NCREIF INDEX APARTMENTS BY LOCATION

18%

35%

47%

25%

38% 37%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

CBRE-EA Office CBDs Other Infill Zip Codes(Top 20% by Population Density)

Lower Density Suburban Zip Codes(Bottom 80% by Density)

% of Total NCREIF Apartment Value Five Years Ago Q4 2016

Source: LaSalle, NCREIF, CBRE-EA (definitions), US Census and ESRI (zip code density)

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CBRE CAPITAL MARKETS

CBRE 2017 MULTIFAMILY CONFERENCE B E Y O N D T H E C Y C L E