January 31, 2017 BLOOMINGTON APARTMENT MARKET OVERVIEW Presented by: Steve LaMotte, Dane Wilson & Dan Gable Central Midwest Multifamily
Agenda Bloomington Economic & Demographic Trends Rents & Occupancies New Construction Transactions Debt Market Overview 2 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington MSA Established Employment Current Unemployment Rate Total Number of Jobs 76,500 76,200 76,400 76,400 76,000 Bloomington 4.0% 75,500 75,400 75,400 75,100 Indiana 4.0% U.S. 4.7% 75,000 74,500 74,700 74,600 74,900 74,900 74,000 U.S. & State unemployment as of December 2016 Local unemployment as of November 2016 Seasonally Adjusted Source: US Bureau of Labor Statistics 73,500 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Preliminary Thru Dec 16 3 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
MSA Population Trends Number of People 170,000 165,000 160,000 155,000 150,000 145,000 140,000 135,000 130,000 125,000 120,000 142,349 159,549 164,132 +2.4% 168,396 +2.1% +12.1% 3.41% 3.33% 13.9% 2000 2010 2016 Est. 2021 Proj. Source: CBRE 4 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
MSA Household Trends 70,000 67,518 Number of Households 65,000 60,000 55,000 55,180 63,350 +14.8% 15.6% 65,578 +3.2% 3.4% +2.7% 5.1% 50,000 2000 2010 2016 Est. 2021 Proj. Source: CBRE 5 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Indiana University Enrollment 55,000 50,000 2.4% Total Students Enrolled 45,000 40,000 35,000 30,000 38,990 40,354 42,347 42,464 42,731 42,133 46,817 46,416 48,514 49,695 '07 '08 '09 '10 '11 '12 '13 '14 '15 16 6 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Indiana University Enrollment - Forecast 60,000 50,000 40,000 30,000 20,000 10,000 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F 2017F 2018F 2019F 2020F 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% -2.0% -4.0% Enrollment(L) Enrollment Growth(R) Source: Axiometrics 7 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington Submarket Map 8 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington Submarket Overview SUBMARKET NO. OF PROPERTIES NO. OF UNITS NO. OF BEDS AVG. AGE Campus Walk 12 530 865 29 years Downtown 17 998 2,218 11 years East 29 3,964 7,427 31 years West 10 1,447 3,235 18 years North 23 1,610 3,242 34 years South 23 3,444 6,065 30 years 9 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington By The Numbers Overall Market Unit Type 0/1 1/1 2/1 2/1.5 2/2 2/2.5 3/1 3/1.5 3/2 3/2.5 4/2 4/4 $/SF $1.68 $1.12 $0.91 $0.78 $1.12 $1.03 $0.83 $0.74 $1.02 $0.88 $1.33 $1.62 $/Bed $628 $762 $367 $380 $552 $576 $274 $309 $403 $427 $451 $652 $/Unit $628 $762 $734 $760 $1,104 $1,153 $821 $926 $1,208 $1,281 $1,803 $2,606 Avg. SF YOY Rent Growth 374 679 807 977 984 758 990 1,257 1,188 1,459 1,357 1,609 6.5% 3.3% 2.9% 1.4% 3.6% 2.0% 1.1% -2.2% 1.3% 8.7% -8.0% -1.9% Avg. $/SF $1.07 Avg. $/Bed $510 Avg. $/Unit $980 Avg. SF 919 *Averages above include all unit styles 10 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington Overall Rents & Occupancy 100% 98% $937 $958 $980 $1,000 $950 1.7% 96% $892 $909 $900 Occupancy Rate 94% 92% 90% 88% $742 $823 $814 $834 $860 $850 $800 $750 Average Rent/Unit 86% $700 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $650 Average Rent Average Occupancy Source: CBRE 11 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington Overall Rents & Occupancy 100% $550 98% 1.7% Occupancy Rate 96% 94% 92% 90% $496 $500 $510 $500 $450 Average Rent/Bed 88% 86% 84% 2014 2015 2016 $400 Average Rent Average Occupancy Source: CBRE 12 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Campus Walk Submarket Rents & Occupancy $595 per Bed Occupancy Rate 100% 98% 96% 94% 92% 90% 88% $708 $833 $834 $883 $895 $909 $915 $921 $948 $970 $1,000 $950 $900 $850 $800 $750 $700 $650 $600 Average Rent/Unit 86% $550 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $500 Average Rent Average Occupancy Source: CBRE 13 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Downtown Submarket Rents & Occupancy $765 per Bed 100% 98% $1,960 $2,000 $1,900 Occupancy Rate 96% 94% 92% 90% 88% $1,421 $1,682 $1,560 $1,505 $1,589 $1,632 $1,674 $1,713 $1,701 $1,800 $1,700 $1,600 $1,500 $1,400 $1,300 $1,200 Average Rent/Unit 86% $1,100 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $1,000 Average Rent Average Occupancy Source: CBRE 14 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
East Submarket Rents & Occupancy $518 per Bed 100% 98% $921 $979 $953 $954 $970 $1,000 $950 Occupancy Rate 96% 94% 92% 90% 88% $784 $812 $833 $857 $880 $900 $850 $800 $750 $700 $650 $600 Average Rent/Unit 86% $550 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $500 Average Rent Average Occupancy Source: CBRE 15 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
West Submarket Rents & Occupancy $472 per Bed 100% 98% $1,023 $1,039 $1,056 $1,100 $1,050 Occupancy Rate 96% 94% 92% 90% 88% $771 $773 $799 $833 $853 $865 $1,000 $950 $900 $850 $800 $750 $700 Average Rent/Unit 86% $647 $650 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $600 Average Rent Average Occupancy Source: CBRE 16 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
North Submarket Rents & Occupancy $462 per Bed 100% $930 $950 Occupancy Rate 98% 96% 94% 92% 90% $732 $795 $807 $831 $833 $839 $837 $852 $858 $900 $850 $800 $750 $700 $650 Average Rent/Unit 88% $600 86% $550 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $500 Average Rent Average Occupancy Source: CBRE 17 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
South Submarket Rents & Occupancy $452 per Bed 100% $850 Occupancy Rate 98% 96% 94% 92% 90% 88% $632 $659 $679 $718 $726 $747 $755 $766 $784 $797 $800 $750 $700 $650 $600 Average Rent/Unit 86% $550 84% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $500 Average Rent Average Occupancy Source: CBRE 18 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Bloomington MSA Building Permits 1,350 Total Permits 1,100 850 600 350 100 269 190 50 33 47 221 316 270 175 116 606 386 256 230 189 200 200 269 279 326 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 Single Family Multifamily December 2016 (p) Source: US Census Bureau 19 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction City Flats on Walnut JC Hart 82 Units / 84 Beds 20 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction Moonburn Olympus Properties 33 Units / 33 Beds 21 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction Urban Station Sila Capital & H.M. Mac 54 Units / 155 Beds 22 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction Echo Park Sila Capital & H.M. Mac 153 Units / 230 Beds 23 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction Patterson Pointe Sila Capital & H.M. Mac 177 Units / 488 Beds 24 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction Name TBD (611 N. Rogers) Pedcor 36 Units / 65 Beds 25 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
New Construction - REDEVELOPMENT Dunnhill 265 Units / 746 Beds 26 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Transactions 2017 Oakdale Square 200 Units / 436 Beds Seller: Justus Buyer: Barratt Asset Management 27 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Transactions 2016 Campus Corner 253 Units / 796 Beds Seller: ACC Buyer: Saban Real Estate 28 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Transactions 2016 The Fields 285 Units / 537 Beds Seller: CPP JV GIC JV Scion Group Buyer: Alex. Brown Realty JV ACH 29 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Transactions 2016 Copper Beech Townhomes & Colonial Crest 313 Units / 699 Beds Seller: Campus Crest Buyer: Harrison Street The Quarry The Arch 30 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Transactions 2016 Union Square 20 Units / 85 Beds Seller: Orion Buyer: Hunter Properties 31 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Transactions 2016 Red Brick 36 Units / 68 Beds Seller: Peter Nguyen Buyer: JSA Investments 32 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Active Lenders 33 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Active Lenders 1 - CMBS: (42%) 5 & 10 year fixed rate terms / 30 Year Amortization 70% - 75% LTV I.O. available at 70% LTV Prefer 12 month leases / Focus on collection seasonality Non-recourse Replacement Reserves of around $100 - $125/bed Pricing on a 10/30 with 2 years of I.O. is around 4.70% 34 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Active Lenders 2 - Fannie Mae: (42%) 5, 7, 10, 12, 15 year fixed rate terms / 30 year Amortization 7 and 10 year floating rate terms 70% - 75% LTV Prefer 12 month leases Non-recourse Replacement Reserves of around $100-$125/bed Pricing on a fixed rate 10/30 with 2 years IO is around 4.80% Pricing on a 7 year floating rate loan is around 3.60% Freddie Mac Currently shy on student housing 35 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
Active Lenders 3 - Balance Sheet Lenders: (16%) Transaction/Relationship Banks: 5 10 year terms / 20 25 Year Amortization Select lenders can go beyond 10 year terms 65% - 75% LTV Sponsor strength/relationship potential can be a major factor Non-recourse and recourse options Pricing on a 5/25 at full leverage is around 4.35% with recourse 36 BLOOMINGTON APARTMENT MARKET OVERVIEW CENTRAL MIDWEST MULTIFAMILY
January 31, 2017 Central Midwest Multifamily Steve LaMotte, Jr. Senior Vice President 317.269.1018 steve.lamotte@cbre.com Dane Wilson First Vice President 317.269.1057 dane.wilson@cbre.com www.cbre.com/invcmmultifamily BLOOMINGTON APARTMENT MARKET OVERVIEW Dan Gable Vice President 317.269.1019 dan.gable@cbre.com