Newspaper article THE JOURNAL RECORD

Racking Up Rentals: Thousands of New Units Could Test Tulsa's Apartment Market

Newspaper article THE JOURNAL RECORD

Racking Up Rentals: Thousands of New Units Could Test Tulsa's Apartment Market

Article excerpt

TULSA - Tulsa may see a record number of new apartment units come online next year, potentially testing the market's strong absorption rate.

"The activity is as strong as I've seen it since I've been in this business," said Mike Marrara, an apartment broker with Tulsa's First Commercial Real Estate Services who has been in the industry five years. "If anything, we're seeing more interest on land and projects than we previously have."

A new midyear market survey by CBRE projects nearly 2,000 new units could enter Tulsa's 60,000-unit market in 2016. These would come in seven large, developing projects spread from Broken Arrow and Bixby to downtown Tulsa.

"Those are just the ones we feel comfortable enough with to say that they're going to move forward," said Tulsa broker Brian Donahue, who wrote that report with fellow CBRE apartment broker David Forrest. "There are probably a few more around town planned for construction as well."

Tacking on one new project announced last week, Case and Associates' 270-unit Cottages of Tallgrass Point in Owasso, could lift the Tulsa area's 2016 tally above the modern construction record of 2,100 units opened in 2000. Other small projects may also factor into the works, Donahue said.

That has some analysts wondering if the Tulsa-area market will face challenges absorbing these units.

"That's a question everybody always asks," said Marrara. "We haven't seen any problems with that so far."

Both Donahue and Marrara pointed to underlying strengths in the market.

Despite more than 900 units coming online this year, following the 1,487 that entered the market in 2013-14, CBRE said Tulsa apartment operators finished the first half of 2015 with an average 93.5-percent occupancy rate, up half a percentage point from a year ago and level with rates charted Dec. 30.

First Commercial reported an even stronger 94.7-percent occupancy rate in its second-quarter Tulsa survey, up from 93.6 percent a year ago and 94.2 percent at the end of the first quarter. …

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