6 days ago
Report: Lots of apartments planned in Tacoma, but many remain on pause
A new regional report from a team with Kidder Mathews real estate group offers insight into a current slowdown of apartment development largely blamed on economic uncertainty.
The annual multifamily development report from the Simon-Anderson Multifamily team published this month notes, 'Pierce County's pipeline is heavily backloaded with development activity stalled in planning while market participants await more favorable economics.'
It added, 'This pipeline structure signals developer interest, but also reflects hesitancy to move forward under current economic conditions.'
According to the report, Pierce County ' is dominated by early-stage proposals, with 10,059 units (16% of total inventory) still in review.'
It added that 'only 1,301 units (2%) are actively under construction, and a mere 871 units (1%)' have received the necessary legal approvals and permits.
For Tacoma's urban core, it listed 4,385 units proposed, 3,812 in review, 395 approved and awaiting development, and 178 units now in construction.
The report notes that the Puget Sound region as a whole is 'entering a period of recalibration.'
'Specifically, concerns regarding the economy, rising construction costs, and tighter lending restrictions have led some developers to rethink permitted projects,' the report stated. 'While some permitted sites will trade hands and construction will commence, many others will be held by developers until a later date.'
By comparison, it showed that projects in Kitsap County were 'more evenly spread across stages than other counties, indicating measured and sustained development momentum.'
The report noted that 'suggests that Kitsap is better positioned than other counties to see near-term deliveries, even as economic headwinds persist.'
As for King County, the report stated, 'Seattle's multifamily inventory surged by 82% between 2010 and 2020, far outpacing suburban submarkets. Yet, recent trends point to a regional rebalancing. Since 2021, Suburban King added more units than Seattle, with 21,966 new deliveries versus 18,973 respectively.'
More information on the annual report is available at Kidder Mathews online.
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