Charleston Market Drivers Align with Successful Primary Markets
- Charleston’s employment, business climate and income growth mirror that of successful primary markets.
- Twelve new apartment complexes were completed from January 2017 through July 2017, which added 2,835 new units.
- Multifamily occupancy rate is still high at 95.4%, despite robust apartment development.
Successful Market Environment
While Charleston is generally classified as a tertiary market in the investment realm, it has similar attributes and economic drivers to that of a much larger, successful primary market and can therefore expect multifamily success to continue into 2018. According to Jeff Adler, Vice President of Yardi Matrix, successful multifamily primary markets are driven by three intellectual capital nodes: employment, business climate and income growth. Charleston has the perfect storm of these three factors to continue the multifamily boom currently underway.
First, Charleston’s employment is a major point in its favor. According to the 2nd Quarter 2017 Realpage MPF Report, Charleston’s employment base grew 1.9%, with the addition of 6,700 jobs from May 2016 through April 2017. While this expansion rate was the slowest it has been over the last four years, employment is still expanding and should continue expanding for several years. Charleston’s employment base is diverse and has the capability to sustain international companies within its market such as Boeing, whose manufacturing center contributes 7,320 jobs, or Volvo and Daimler-Benz, major players in the automotive sector that have added 3,700 jobs to the Charleston market. Meanwhile, construction employment is growing, to support the robust demand for new residential and commercial developments. In addition, the channel-deepening construction of the Port of Charleston promises to grow employment in the coming years, as it will create the deepest harbor on the Atlantic Coast and able to expand its inland port capacity. These stable drivers are expected to create employment and thus renters within the Charleston market.
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