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After 2-3 years of the greatest construction cost increases for decades due to the pandemic we are now seeing a substantial slow in building cost increases. Now is the absolute best time to begin planning your own extension/alteration or upgrades to your biggest investment, your home. I published a blog recently highlighting this point and in addition taking note of the regulatory change relating to sustainable construction standard changes. Prices may have stablized but the length of time it takes from planning to execution is still very slow. If you’re thinking about upgrading your home at least make a start on the planning stages. NZ Proud & Pou Architecture can provide: - Free first consultations to discuss wants and needs; - Feasibility review to determine if your plans can be done, what they’ll look like and estimated costs; - Mortgage broker third party to aid in finance feasibility; - Full design, consent and build prep; - Deliver the project to the highest standards; - After care once complete. Don’t delay, reach out and let’s start planning together.

"New construction deliveries reached a new high of 140,800 units in Q4 2023, bringing the four-quarter total to a record 416,500. Fewer construction starts in recent quarters indicates there will be a decrease in deliveries in 2025 and beyond..." #housingmarket #realestate #housingaffordability #homeconstruction #multifamilyconstruction #housingdemand https://lnkd.in/gEQ77ebK

In 2023, Atlanta experienced a record-breaking year for multifamily construction, leading to the largest-ever divergence between overall and stabilized vacancy rates. Stabilized properties, with at least 90% occupancy or open for 18 months, have a vacancy rate of 9.5%, while the overall vacancy rate, including new projects still leasing, stands at 12.4%. This gap highlights the differing challenges faced by property owners competing with new developments versus those with stabilized properties. Historically, the gap averaged about 120 basis points pre-pandemic but has recently expanded significantly. The high stabilized vacancy rate is impeding rent growth, currently at a negative 2.3% year-over-year. Despite recent construction slowing, Atlanta's multifamily inventory saw substantial growth, adding nearly 24,000 units in the past year. Increased competition has led to more properties offering concessions, with 39% now providing incentives compared to 6% in early 2022. Both vacancy rates are expected to remain stable this year, with a return to positive rent growth anticipated in 2025 as the construction pipeline diminishes.

A fascinating story on the swings in CRE construction, rent growth, and now decreases in value have lead to certain properties selling for well under construction costs. Anyone who says that there aren't any deals out there haven't been looking hard enough. The investor success story can be replicated by anyone!

"Multifamily construction spending stayed flat in July after a dip of 0.6% in June. Year-over-year, spending on multifamily construction declined 6.7%, as an elevated level of apartments under construction is being completed. Private residential improvement spending increased 1.2% in July and was 18.3% higher compared to a year ago." #construction #suretybonds #bondwiththebest https://lnkd.in/g-h6KBNK.

There has been quite a bit of discussion on construction escalation, below are our current projections for ICI & High Rise Residential in the GTA. ICI is a blend, industrial would be lower than Institutional. This is an average, there would be individual projects that would differ from this depending on composition and so forth. There is the potential for escalation to drop further on the residential side depending on the recovery (or lack of one). Sales are expected to be awful this year; the rental market when / if it accelerates will drive late 2024 and early 2025. This is the best opportunity to tender / build residential since 2016 and could be the last one for a similar period  Big question do high-rise sales come back end of this year or next year? If you have a rental project I would consider accelerating the construction and tendering into the next 18 months or so. While I am leaving Altus Colin Macdonald, MRICS, PQS will be happy to help going forward on escalation or construction related questions.

I've had the greatest of intentions to post more often about myself and my business. Some who know me well may think it would come naturally to speak highly of myself, but in reality, that's not the case. When it comes to business, I've always wanted to let my results do the talking. However, you've got to talk about what you're up to, not just your results, to keep people up to date and tuned in, so I am beginning to use this space more effectively because I'm proud as hell of my journey, and what we've been able to achieve together as a company and where things are headed, personally and professionally. So, what have we been up to? August was a great month for us, as we closed out our project at 294 Beacon St. in Somerville, MA. We engineered and built a 5-Unit, 7200 GSF condo building with garage parking under. We started our due diligence on this project in January of '22 and closed on it in June of '22. It took us a year of planning and engineering to redesign the building and receive full permits from the City of Somerville. During that time, interest rates spiked, as did our estimated construction costs, by $300,000, or nearly 16.66% above our original estimates. To cover the difference, we raised a round of preferred equity with the full understanding that our worst-case scenario would have us working for free for 2 years. We already had our capital and our LP investors' capital committed, so there was no turning back. It was our most challenging development to date, where nearly every metric seemed down to the inch. We successfully closed out all units by the end of August and netted all of our investment partners a 30% cash-on-cash/15% average annualized return over almost exactly 2 years. There were some sleepless nights, countless internal budget reviews, and frequent market evaluations which ultimately, is how you should be managing your projects...minus the sleepless nights hopefully. A big shout out to our team that helped make this project come alive: our architects Context Workshop, our GC's Elevated Construction, Site and Civil Engineer TMF Associates, Inc., our structural engineers Forest Structural, MEP Engineers Zade Associates, HERS Engineers Sustainable Energy Analytics, and Landscape Architects MDLA. The development business is truly a massive team effort and all those not mentioned, you are certainly not forgotten. If you're interested in learning more about what we do and how you can benefit from our expertise, feel free to drop me a DM here, or sign up to be on our email list at www.capequitypartners.com and enter your information for our free Investment Thesis and future private emails. See, that wasn't that hard! Was it great? Probably not, but I did it, and that's the goal. Tomorrow I'll fill you in on a current project we are nearly complete with; 224 W Ninth St. South Boston. Now, if I could only figure out how to insert pictures???

Builder confidence rose for the fourth straight month and residential construction stats may now be trying to catch up. Both construction permits and housing starts rose in February compared to both January and February 2023 levels.

The main problem with packing too many towers on a small site and trying to flip with the approvals is that you can't phase the 3 or 4 levels of parking. You have to excavate and shore all 4 sides and that cost has to be absorbed in Phase 1 first tower. They should have had a Construction Management firm at the table during the Due Diligence period. Add to that all the interest rate and construction costs and the disappearing Presales investors and poof.. If it made sense to us, the land bid would be based on a 2 tower density possibly with 2 levels of UG parking, not the 4 tower density and 4 levels of parking that may never be built. Get in.. Get out.. https://lnkd.in/gyP8x92N #developer #construction #planning #design #affordablehousing #affordablerentals #realestate #commercialrealestate #condos #realestateindustry #interestrates #loaninterest #inflation

Austin Construction Collapses as Housing Market Struggles This year, the city has seen builders secure 21 permits per 10,000, almost half of the average it recorded between 2021 to 2023, according to real estate platform Redfin. The decline is part of a national trend in which building permits plunged 30 percent during the same time period. https://lnkd.in/gpgiBvPu