News
Multifamily Monday; Bright in Boston
August 16, 2010
| After 56 years in the multifamily business and 5,000 rental units in his privately owned portfolio, The Hamilton Co.?s Harold Brown has seen a few cycles play out. This time around, he's so optimistic that he's buying and building now, confident values are on the rise. |
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| By next year, renters will be ?breaking down the doors? he tells us from his Brighton office. He's been confident in the apartment sector throughout the recession. Last year, his $130M purchase of Dexter Park was the largest US multifamily buy. Now that his portfolio in the region is 1.8% vacant (compared to 6.2% for metro Boston), he's downright eager to acquire or develop more. ?Soon it'll be too expensive.? He has offers out on several properties. Meanwhile, next spring he will start to convert his Downtown Crossing office building at 8 Winter St. into 50 apartments: ?Lenders are falling over themselves to finance the construction loan.? |
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| Last week, 21 of his property managers met and reported that concessions are vanishing and vacancies trending toward zero. Indeed, buildings in Brookline, Watertown, and Boston are full, and for some units, rents are going up. At Dexter Park, just two of its 409 apartments are vacant, compared with 30 last year. Hamilton COO Carl Valeri attributes their success in part to the autonomy managers have to adjust rents with market conditions. Hamilton also updates its Craigslist ads every two hours, and mobile apartment hunters (on a train, for example) can learn about rents by texting with the company. Too bad, Harold says, ?The T hasn?t agreed to hand out applications.? |
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| Carl,whom we snapped with Harold during the manager?s meeting, later told us a new 40-unit building completed last fall at 601 Albany St. is 100% occupied. Construction started during a diffiuclt time, Sept. ?08, but ?we weren't worried? because it's near a complex of healthcare and medical research buildings. A gut renovation of a property in Hyde Park into 60 artist lofts was also completed last fall and is one-third sold. With scant new apartment supply in the pipeline, rents will rise this year and next, tempered by lingering unemployment. While Hamilton has some retail and office in its portfolio, it's ?not much, by design.? Compared with offices, apartments aren't as capital intensive to maintain and are less risky. Carl says, ?At the end of the day,people need a place to live.? (Tell that to people already living in line for Avatar 2.) |
