Hello!
A belated Merry Christmas and just around the corner, Happy New Year.
I’ve spent the last two weeks reflecting on 2021 and preparing for 2022. It’s not too late to review the performance of your investments compared to your goals for the year; and to lay a strong foundation for next year.
If you haven’t built a game plan for next year or don’t have a baseline for how your property performed compared to the market this year, please reach out. I’m happy to help you evaluate your assets compared to today’s market and put you in the best position for success in the new year.
Year End Reflection
- Here’s what 2021 looked like for me: I made 2,070 phone calls, held 203 meetings, prepared 60 property valuations for owners just like yourself, and closed on $25.7M of apartment properties across 13 deals in Eastern Washington.
- I outperformed my own expectations but still have plenty of areas to improve in the new year, particularly in building a team and staying focused on my highest-value tasks each day. If you’re curious, I’ve been diving deep into my yearly reflection on Twitter.
- What did 2021 look like for you? If your goal was to…
- Grow & Scale -- How many properties did you acquire? How many units did you add to the portfolio? What property-level returns metric are you tracking?
- Simplify & Consolidate -- Did you find opportunities to acquire simpler properties to operate and manage? Did you make the right portfolio moves? Are you spending less time each week working on or thinking about your holdings?
- Increase Operational Efficiency -- Did you increase property-level NOI? Did you decrease the average unit turn time, increase advertising efficiency, or decrease ongoing maintenance costs?
- If you’re unsure how your property performed this year, or you are unclear what goals you should be setting for 2022, please email or call me. We will evaluate your property performance and build a game plan for success in the near year together.
- I hope you had an incredible 2021 and here’s to an even better 2022!
Overall Market
- Multifamily didn’t just weather the storm, it thrived in 2021. Property values are at a 15-year high while deals changing hands continue to break records across the nation.
- Doubts remain as to what 2022 will look like compared to this record year, with conflicting opinions across the industry. Will rising interest rates topple values and will inflation cause NOI declines at the property level? Or will inflation continue to drive rents up and capital continue to flood the market by investors seeking yield in the most favorable asset class? We will find out in the new year!
- You should be prepared for either scenario when it comes to your property holdings. If you don’t feel prepared for 2022, let’s sit down to put you in the best position for success next year.
Multifamily
- Eastern Washington multifamily saw historic sales velocity this year. I kept record of every recorded multifamily sale in each market. Here is a breakdown of that data for the second half of 2021 (Jun-Dec):
- $332.9M in multifamily sales in Eastern Washington across 63 properties and 2,055 units
- $185.4M of the sales were in the Tri-Cities, and $103.7M were in Spokane, representing 87% of total sales in Eastern Washington
- $122.4M of the sales occurred in December, representing 37% of the sales volume for the entire year
- I personally enjoyed working on $25.7M of property sales in Eastern WA this year and look forward to helping owners realize maximum value on their property in 2022.
- For property owners who didn’t buy or sell this year, you likely still went through a year of record activity as apartment management became more complex than ever before. Rapidly changing rents, rising expenses on every line item, an eviction moratorium for most of the year, and legal changes nearly every month all contributed to ownership complexity.
- I recommend giving a big thank you to your property management team this week, as they likely worked overtime on your behalf to operate your property efficiently and meet your goals for the year.
Local News
- Spokane ranked #3 in a top housing markets prediction for 2022, behind Boise at #2. Spokane saw record growth in home sales and rents this year, and it doesn’t show signs of slowing in the new year.
- Idaho led the country in population growth in 2021, growing 2.9% between 2020 and 2021. An impressive ranking among its peers that owners of apartments have recognized all year long.
Development
- Multifamily construction nationwide has reached the highest levels since 1974. Considering most of Eastern WA apartments were built in the 70s, this is a staggering metric.
- If you haven’t thought about the impact of increasing apartment supply on your current holdings, it’s probably time to consider the impact and build a plan to avoid any negative impact in 2022.
That’s a wrap for this year. I’ll see you next year where I will continue to provide valuable market insights that help you manage your investment portfolio across the Inland Northwest!
If you’ve enjoyed my monthly newsletters this year, please let me know! I’d love to hear what you enjoyed most, and any suggestions for improvement in the new year.
Happy New Year!
Mason Fiascone
.jpg)
.jpg)
.jpg)