Rental Rock ‘em, Sock ‘em
By: Nicholas A. Dunlap, CPM
According to this morning’s OC Register, Apartment rents are now hitting bottom. Funny, they said the same thing a few months ago. Truth is, rents at B and C Class Properties in Orange County are now on the rise, up from where they were last year at this time. A Class properties are a different story. The influx of high-end development and failed condo projects in Anaheim, Orange and a handful of South Coast Metro locations that are now operated as rentals have increased competition amongst landlords. With that, the bare-knuckle, rock ‘em, sock ‘em type combat remains in place.
Rock ‘em, sock ‘em is the perfect parallel to the buffoonery that occurs at the helm of some of these properties. To start with, a barrage of soft, short and uneffective punches, the equivalent to a dismal jab would be reflected in the initial offering of 2007 prices in the 2010 market. Then, the jabbing would escalate into a more serious exchange of powerful jolts. These punches, more aggressive in nature, are more serious and effective, liken them to the offering of 2 or 3 months free on a 2 year lease. Yes. That’s correct. Commercial lease terms and incentives finding their way into Residential operations. This is when the robots really begin to rattle. Right now, in A Class multi-family, the robots are rattling. Not just in Orange County, but nationwide.
And thus, we stand and observe: waiting for heads to pop off.