Metro Vancouver eyes standardized six-storey wood apartments  Vancouver Sun

Read more here:
Metro Vancouver eyes standardized six-storey wood apartments - Vancouver Sun

Multifamily permitting drops in urban areas  Multifamily Dive

Read this article:
Multifamily permitting drops in urban areas - Multifamily Dive

Apartment Construction Is Slowing, and Investors Are Betting on Higher Rents - WSJ  The Wall Street Journal

Original post:
Apartment Construction Is Slowing, and Investors Are Betting on Higher Rents - WSJ - The Wall Street Journal

Multifamily home construction still slowing, but predicted rate cuts could lower barriers  Star Tribune

Excerpt from:
Multifamily home construction still slowing, but predicted rate cuts could lower barriers - Star Tribune

The Construction Site Outside My Building Is Filthy. What Can I Do?  The New York Times

Read the rest here:
The Construction Site Outside My Building Is Filthy. What Can I Do? - The New York Times

Higher mortgage rates continue to have a counterintuitive impact on home building in the Twin Cities metro as construction of for-sale, single-family housing increased at a double-digit pace while apartment construction maintained its free-fall.

During June, cities issued homebuilders in the metro 542 permits to build the same number of single-family homes, a 15% increase in the past year, according to a monthly report from Housing First Minnesota, which tracks residential construction throughout most of the 13-county metro.

Apartment construction, however, plummeted. Builders and developers gained enough permits to build only 24 multifamily units, a fraction of last year's total at the same time and the monthly average.

"As homebuyers adapt to current interest rates, more and more buyers are drawn to new construction where many builders are offering incentives," said Art Pratt, a longtime Twin Cities builder and board chair of Housing First Minnesota, in a statement.

Higher mortgages rates are driving these divergent trends. They have kept sellers with much lower rates on the sidelines, constricting the number of houses put on the market and limiting options for buyers who are willing and able to buy at today's higher rates.

Mortgage rates, which are still near the historical average but are more than double the rate two years ago, have increased borrowing costs for developers and forced many developers to hit the pause button on many new apartment projects.

"Builders are adapting to the current housing market as the demand for homeownership has not wavered, even as rates and home prices have made it challenging for many," Pratt said.

In June last year, there were 548 total permits issued for a total of 566 units, according to data the Keystone Report collected. That's the least number of permitted units for any June in several years until this year.

So far this year, 3,841 total housing units gained permits, nearly 1,000 fewer than last year at this time and the fewest in several years. Only about 22% of those units were multifamily apartments and other rentals. During a typical year, about half of all total units are multifamily.

Higher borrowing costs are causing the downturn in rental construction. They come at a time when a near-record number of new apartments are completing, creating what's expected to be a temporary increase in the average vacancy rate in some parts of the metro. In much of the metro, the average vacancy rate is already below 5%, making it a landlord's market in those areas.

Through the past two years, builders have constructed nearly 20,000 new apartments, according to a second-quarter report from Marquette Advisors. Construction has tapered quickly: By the end of 2024, only 7,350 units should finish, with 3,785 following next year.

Already, the Twin Cities is quickly become a much more competitive rental market, according to a report RentCafe released Monday. The national rental search firm showed apartments in the metro become occupied within 53 days, on average, with eight renters competing for every unit.

"The complete drop off of multi-family construction is concerning," said James Vagle, CEO of Housing First Minnesota, in a statement. "Minnesota needs housing of all types."

Read the rest here:
Single-family construction is on the rise in the Twin Cities, while apartment construction is in a free-fall. - Star Tribune

Portland, Oregon Deacon Development Group, in collaboration with Deacon Construction, LLC, proudly announces the completion of the Merx market-rate apartment building located in the vibrant Slabtown neighborhood of Northwest Portland. This modern seven-story building spans 57,412 square feet and offers 126 thoughtfully designed studios and one-bedroom apartments.

Each studio apartment at Merx features a full kitchen, a washer, and a dryer, catering to the needs of urban dwellers seeking convenience and comfort. With eight unique layouts, ranging from 297 to 433 square feet, residents can choose a space that best suits their lifestyle.

Merx boasts competitively priced units with high-quality finishes, complemented by thoughtful amenity spaces. The building includes an amenity room/courtyard and an expansive rooftop deck, providing residents with ample opportunities to socialize and unwind. Merxs five-story wood-framed structure sits atop a two-story concrete podium, offering both durability and aesthetic appeal.

The buildings ground floor features a residential lobby, street-facing retail spaces, off-street loading areas, a residential courtyard, and an amenity room. The rooftop deck offers stunning views of the surrounding cityscape, making it a perfect spot for relaxation and entertainment. Construction of Merx began in August 2022, and we are excited to invite the community to the official ribbon-cutting ceremony on July 10th, from 10:30 am 12 pm.

The successful completion of Merx is attributed to the collaborative efforts of the dedicated project team, including owner/developer Deacon Development, architect YBA Architects, civil engineer Humber Design Group, structural engineer KPFF, and general contractor Deacon Construction a sister company of the developer.

About Deacon Development GroupDeacon Development is a Portland-based real estate development firm. We specialize in the selection, acquisition, financing, development, and disposition of retail, medical, office, and multifamily projects in the Pacific Northwest.

About Deacon Construction, LLCDeacon Construction, LLC is a full-service general contractor dedicated to providing clients with a product built in an atmosphere of honesty, respect, and open communication. For more than 40 years, they have specialized in construction of hotels, restaurants, retail centers, mixed-use buildings, multifamily housing, and entertainment facilities, as well as healthcare and office buildings. Through their dedication to surpassing client expectations, ability to manage diverse and difficult projects, financial strength and competitive pricing, Deacon Construction has emerged an industry leader throughout the Western United States.

Read the rest here:
Deacon Development Group Announces Grand Opening of 126-Unit Merx Apartment Building in Portlands Slabtown - The Registry Seattle

Three years after Suffolk Downs won city approvals, there was supposed to be a lot more going on by now on the nearly four dozen other buildings that will eventually rise at the 161-acre property. But housing construction at the site is on hold until developer HYM Investment Group can hash out a complicated financing deal that has been pushed out of balance by an out-of-whack economy.

The holdup is a reality plaguing housing developers across Greater Boston over the last two years. Demand in our housing-starved region is sky high. And developers such as HYMs Tom OBrien have all the hard-won permits they need. But for all the attention paid lately to fights over zoning and other local approvals recently, securing permits to build isnt even the hard part right now. Amid high interest rates and materials costs, raising enough money is the real problem.

The whole dynamic of housing finance has shifted, said OBrien. It has become so much harder to make these projects work.

Indeed, every major ingredient of an apartment building from wood to steel to electrical components costs more than it did before Covid. Overall materials costs have jumped 43 percent since the start of 2020. Interest rates for construction loans have more than tripled. The investors who typically fund housing development are demanding higher returns, too. Financing new housing in Massachusetts was a complex undertaking five years ago; now it seems impossible.

Theres no hard-and-fast tally of permitted units that are not under construction across dozens of Greater Boston communities. But officials in suburban towns talk about construction permits sitting on the shelf because developers cant close on financing. In Boston, for example, researchers at the citys planning and development agency last year estimated there were nearly 23,000 units stuck in the pipeline. (For comparison, from 2017 through 2021, a little more than 20,000 units were built in Boston, according to a 2022 report from the Mayors Office of Housing.)

One proxy measure of the backlog comes from the housing developed under the states 40B law, which allows developers to bypass local zoning in towns that have insufficient levels of affordable housing. Officials at the quasi-state agency MassHousing say they know of some 20,000 units on pause right now. Those mixed-income projects typically rely on revenues from market-rate apartments to finance the affordable units, making them particularly vulnerable to economic shifts.

The story is much the same all over the region. Through the first five months of the year, fewer than 5,000 units worth of building permits were issued across Greater Boston. Thats down a bit from the same time in 2023, which itself was the slowest year for new housing production in more than a decade.

In a region like Greater Boston, where homes and apartments are already in extremely short supply, that will have consequences for years to come, with supply continuing to fall even further behind demand.

We need that pressure of new construction to bring down rents, said Adam Guren, an economist at Boston University. So I would find it worrisome if theres going to be a lull in building. Its pretty simple: If theres a construction lag is hitting us in several years and demand remains strong for the Boston area, mechanically, rents have to go up.

OBrien, who spent years working on the permits for Suffolk Downs, blames two key factors: the rise of interest rates and construction costs.

The price of lumber and steel major ingredients in housing construction shot up during the pandemic thanks to international supply chain disruptions. Theyve since stabilized, but have not come back down to pre-pandemic levels.

Interest rates, too, shot up as the Federal Reserve moved to tackle inflation, which has made it more expensive for developers to secure construction loans. Interest rates on construction loans are roughly 5 percentage points higher than in 2022.

For an example, OBrien points to a residential tower HYM built as part of the redevelopment of the Government Center Garage. When HYM broke ground in 2017, it cost the company around $680,000 per unit to build. Today, he said, that figure would be more like $1 million.

Whats more, given what they can earn by simply stashing cash in a bank right now, the investors who normally finance housing development are demanding higher returns. So to draw that investment, developers have to make even more money off of their buildings. This can translate to higher rents, but rents have their limits too.

Imagine you had a building that was before returning 6 percent on an investment, said Guren. With a higher construction cost youre returning maybe 4 percent. That building used to make twice as much income as was necessary to build. Now its not enough.

That is ultimately what OBrien says is preventing more construction at Suffolk Downs. HYM is working on a deal to build a second apartment building on the Revere side of the site, but right now it would cost roughly $400,000 a unit. He figures he needs to get that down to $350,000 to secure a deal with investors. So HYM has been working to simplify the architecture of the building and cut back some amenities to make the costs balance.

The equity is literally like an on-off switch, OBrien said. Either you get to the six and a half percent return on cost, or you dont have a project.

But while its easy to flip the production switch to off, turning it back on takes a lot more time.

From conception to grand opening, it takes about five years for a developer to build an apartment building around here. Even permitted projects will need years before they actually house people. There are still projects underway that launched before interest rates spiked, but a lull is coming once those are finished.

If financing markets (hopefully) ease by mid-2025, we would expect new units to be available in 2030, with the intervening years providing little new production, development firm Cabot Cabot and Forbes put it in a recent white paper.

Andrew Chaban, chief executive of Princeton Properties, a local developer and apartment owner, explains it like this: Nearly every step of the financing process from buying the land, to securing a construction loan, to attracting equity has become more complicated and expensive, driving project costs up. When project costs go up, those expenses get passed on to renters.

Theres nowhere else for those costs to go, if we want the housing to get built, said Chaban.

Some experienced developers are still moving projects along in the suburbs, But even some major suburban developments, including a housing and life sciences complex at the Riverside MBTA stop in Newton that was first proposed in 2018, are stuck.

The nearly 600-unit Riverside project has been paused since late 2022, and the formula for moving it forward just doesnt work anymore, said Howard Cohen, board chair of Beacon Communities, one of the developers.

Part of the problem, said Cohen, is that the market for lab development, which was supposed to be the focus of the first phase of the Riverside project, has cratered.

In recent years, builders have had success bundling labs and housing in one project because the lab space could help subsidize the housing. Now both sides of the deal are hard to finance. Cohen said the developers are talking with investors, but may need to accelerate housing into the first phase, which will require more city permits.

The economic forces that have thrown off Riverside, he warned, could still take several years to correct.

Fundamentally, weve got an equation right now that doesnt work, said Cohen. Over the long run the equation will get straightened out. But we dont know how long thats going to take, and in the meantime we need to keep building.

Cohen and other developers see an urgent need to get things moving again, whether the economy stabilizes soon or not.

Some are backing an idea from MassHousing to create a momentum fund that could be used to plug financing gaps for mixed income housing so they can break ground. The proposal is included in the housing bond bill currently before the Legislature, where the House proposed $250 million and the Senate offered $50 million; the precise amount could be negotiated in the coming weeks.

We need to find a way to keep building, said MassHousing CEO Chrystal Kornegay. And if we dont start now, the day when we have the housing we need coming online moves further and further away.

Andrew Brinker can be reached at andrew.brinker@globe.com. Follow him @andrewnbrinker.

Link:
Housing construction in greater Boston stymied by sky-high costs - The Boston Globe

The Census Bureaus report on construction spending said that the value of multifamily residential construction put in place in May was down 0.02 percent from the revised level of the month before. Spending on single-family residential construction was reported to fall 0.7 percent while spending on improvements was up 0.30 percent.

With this release, the Census Bureau revised the seasonally adjusted data back to January 2017. Therefore, the revisions to the prior months data in this report may be much larger than usual.

The value of total private residential construction put in place in May 2024 was reported to be $918.2 billion on a seasonally adjusted, annualized basis. This figure, which includes spending on both new construction and on improvements, was reported to be down $2.0 billion month-over-month. This is the first significant monthly decline since April 2023. With the Census Bureaus updates to their past data, Aprils figure was revised higher by $28.8 billion. Residential construction spending in May was reported to be up 6.5 percent year-over-year.

The value of new private construction of multifamily residential buildings put in place in May was reported to be $130.8 billion on a seasonally adjusted, annualized basis. This was down $21 million from the revised level for April. However, the April figure was revised lower by $1.15 billion, so the preliminary multifamily construction spending figure reported this month is $1.17 billion, or 0.9 percent, lower than the preliminary figure for April reported last month. The reported value of multifamily housing construction put in place in May 2024 was 4.6 percent lower than the level of May 2023.

The first chart shows the difference between the levels of multifamily construction put in place reported last month and the levels reported this month. It shows that the revisions to the data in this months report point to a lower, and declining, pace of multifamily construction completions than was presented in last months report.

For reference, the Census Bureaus New Residential Construction report said the number of unit completions in May in buildings with 5 or more units fell 7.2 percent from the level of the month before. Completions were 0.2 percent lower than their year-earlier level.

Governments were reported to have put $12.22 billion in residential construction in place in May on a seasonally adjusted annualized basis.

The value of new single-family residential construction put in place in May was $436.6 billion on a seasonally adjusted, annualized basis. This was down $3.02 billion from the revised (+$442 million) level for April and was up 1.38 percent from the level of May 2023.

The value of improvements to residential buildings put in place in May was reported to be $350.8 billion on a seasonally adjusted, annualized basis. This was up $1.04 billion from the revised (+$30.52 billion) level for April and was up $9.62 billion from the year-earlier level. The Census Bureau does not separate out improvements for single-family and multifamily residential buildings.

The following chart shows the value of residential construction put in place each month since January 2012. It also shows the trend line for single-family residential construction based on growth in construction volume during the period from January 2012 to June 2018.

The chart shows that the value of multifamily residential construction put in place reached its most recent high in June of last year and has been generally been trending lower since then.

While last months data indicated that the value of single-family construction put in place was continuing its slow climb, this months data shows this figure falling for the last two months.

The value of improvements put in place was revised sharply higher in the updates to past data in this months report. Whereas the earlier data had indicated that the value of improvements put in place had been falling, the updated data indicates that it has been rising since last November, with a 10 percent gain since then.

The report from the Census Bureau also includes information on spending on other types of construction projects. The full report can be found here.

Go here to read the rest:
Multifamily construction spending trending lower in May - Yield PRO magazine

The SuperBungalows, a new apartment building completed this spring in the hip Silver Lake neighborhood of Los Angeles, is not a traditional bungalow. The project is an answer to LAs need for density and housing, with a nod to the pleasures of living in an individual residence with a porch. It replaced an existing single-family house, an increasingly common occurrence in a city where land values make houses unaffordable to all but the rich or lucky familial inheritors. Most notably, the SuperBungalows represents the first cross-laminated timber (CLT) multifamily residential building in Los Angeles, the start of what the developer SuperLA hopes to replicate many times in the city.

Photo Madeline Tolle

Consisting of nine units, six one-bedrooms and three two-bedrooms, there are no party walls for the market-rate apartments. Each unit is set apart by private balconies and shared outdoor spaces like a small bungalowthe difference being the one-bedroom units are stacked in threes at either end of the east-west-oriented rectangular building, while the two-bedroom units stack to form the middle. Outdoor corridors and open stairs, along with an elevator, define the south elevation, while the entire mass sits on a concrete foundation and parking garage that takes advantage of the sloping lot to appear unobtrusive given its size. Every square inch of the site is given to something, including the rooftop, which includes a garden, seating, and a photovoltaic array that powers the common spaces.

Photos Madeline Tolle

Although many apartment buildings in LA feature kitschy namesCedar Tropics or La Traviata, for examplethe SuperBungalows is more of a brand eco-system by SuperLA, a start-up created by Aaron van Schaik. The companys model includes all aspects of the multifamily market, from land acquisition to design and construction and ongoing ownership and management. The focus on CLT construction, however, is at the heart of the enterprise.

Image courtesy SuperLA

The way we supply housing now is incredibly inefficient, says van Schaik, who breaks down SuperLAs approach into three categoriesproductization, panelization, and optimizationthat he believes addresses the time-consuming ground-up, balloon-framing approach to most multifamily housing projects. First, SuperLAs in-house designer, Jeff Chinn, planned two standard layouts, which they dub 1-bedroom and 2-bedroom products. A one-bedroom product is always 24 feet wide by 30 feet long, a predictable module that everything is rigorously standardized around to eliminate construction waste and offer a 650-square-foot residence. SuperBungalows was a prototype, but now each product can be easily site adapted to new projects. The company also plans to obtain pre-approval of the products with the City to expedite permitting in the future.

The second category focused on the CLT panels, which were produced by Nordic Structures in Canada out of black spruce. By panelizing the floors and roof with 5-ply, 7-inch-thick CLT, the project minimized on-site construction time. The floors include several layers to address sound transmission requirements, including 2 inches of lightweight concrete and floating Capri cork floor planks. The exterior envelope is a rainscreen finished with CERACLAD panels, a GFRC product with nearly 50 percent recycled content and full recyclability at end of life. The walls were framed more conventionally on site as part of the proof of concept. Van Schaik hopes in the next iteration of the project, the company can panelize the walls and prefabricate them in a facility they are currently developing, or even subcontract them out to other parties.

The CLT panels also reflect a biophilic design sensibility that informs many features of the building, including the cork floors, generously-sized operable windows for cross-ventilation, daylighting and views in the open living room, kitchen, and bedrooms. Van Schaik considers the restrained and natural material palette, daylighting, and expansive use of built-in cabinets and closets to be a more common-sense approach to luxury compared to the granite counter tops and acres of clubby amenities that currently define the top end of the rental market.

Other features speak to the citys environmental agenda, including the rainwater storage tanks holding 2,500 gallons for irrigation, secure bicycle storage, and electric vehicle chargers at each parking spot. The building is fully electric, with heat pumps for both hot water and the mechanical system. The landscape design, by Stephen Blewett with CRAFTLandscape Architecture, highlights native species like penstemon, manzanita, and Island Oak and Western Redbud trees.

Optimizing the team and delivery of projects is SuperLAs third strategic focus, which is one of the reasons the SuperBungalows were able to go from idea to fully-occupied building in less than four years. The SuperLA team is only four people, including project manager Sophia Smith and brand leader Quinn Arneson, but they have also made strategic partnerships with suppliers like Pella windows and Mosa tiles to further expedite production.

With lessons learned from SuperBungalows for how to get through planning approvals with the city, such as the ability to eliminate adding a layer of plywood over the CLT floor panels, SuperLA is in construction on another, larger building in the neighborhood. Van Schaik says they were able to compress their design time to a month versus a year, plan review to 6 months versus a year, and construction to 14 months instead of two years, which significantly improves the financial return given the apartments will start renting sooner. The new project also includes two units of affordable housing and a transit-oriented communities density bonus, mutually beneficial to both SuperLA and for addressing the citys perpetual housing crisis.

Originally posted here:
SuperBungalows, a New Cross-Laminated Timber Apartment Building, is a Los Angeles First - Architectural Record