Fort Lauderdale, Florida, is in the midst of an enormous apartment supply wave.
Multifamily inventory has increased by more than 16 percent over the past five years, making it one of the fastest-growing markets in Florida, just behind Orlando (22 percent) and Palm Beach (20 percent).
Over a quarter of the development in Fort Lauderdale has been within the Pembroke Pines/West Miramar area, followed by Plantation/Sunrise, which has increased its inventory by 20 percent.
Development did slow in 2018 compared to 2017. More than 2,700 units came online in 2018, but strong demand allowed vacancies to gradually compress throughout the year and are currently at 6 percent. Projects built last year averaged over 23 move-ins per month, up from the previous two-year average of 18 units per month.
The Atlantico at Palm Air that opened in May 2018 leased at one of the fastest rates in the metro. The property stabilized in four months, averaging about 50 move-ins per month during leas-up.
This next supply wave will further test the market on how much it can handle. Over 9,000 units are set to hit the market over the next few years, which equates to 8 percent of inventory. This is just behind Miami, which has 17,000 units under construction and has the largest pipeline in the nation on a percentage basis.
Over half of the construction is going on in downtown Fort Lauderdale, with close to 5,700 units under construction, followed by Plantation/Sunrise’s 1,200. Given that vacancies compressed almost 100 basis point over the last year, they shouldn’t elevated too far above their historical average.