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The apartment market in the northern suburbs – similar in some ways, but not in current lease-up…

• Apartments have been rapidly expanding in the northern suburbs due to the area’s significant employment gains.

• While the Class A & B market has softened a little as new product has recently delivered, occupancy remains around 90 percent in both corridors.  Average rents are also comparable at about $1,225 per month.

• Newer units delivered between 2012 to 2016 are now mostly stabilized, although I-75, occupancy is beating the market average slightly at 91.7 percent.  In comparison, Tollway properties are at 87.2 percent. 

• Importantly, I-75 started delivering units ahead of the Tollway in 2014 and 2015, so they have been in lease-up a little longer, which accounts for the higher occupancy.​

• There has been a shift in the lease-up performance of the most recent deliveries.  For I-75 projects now marketing, lease-up has averaged 16-17 units per month per project, versus 21 to 22 per month for the Tollway.

• While this difference may seem small, the slower pace translates into an additional 2 to 4 months to lease a typical 250-unit project – which means stabilization could require longer than a year – and impact first-year operations.

Source: Axiometrics; CoStar; JLL Research

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