While metro Washington, DC seems to rank at the top of the list of just about everyone's favorite apartment markets, current performance stats actually are a little stronger in adjacent Baltimore.

June's occupancy rate in Baltimore's base of about 190,000 apartments stood at an even 96 percent, up 2.1 percentage points from the late 2009 figure and 0.7 points ahead of occupancy in Washington, DC. Neighborhood-level occupancy was right around the 95 percent mark in even the weakest of Baltimore's individual submarkets, and the rate was 97 percent or better in Ellicott City/Columbia and the Towson area.

Effective rents in metro Baltimore jumped by 4.2 percent during 2010's initial six months, measuring change on a same-store basis. Since rents only backtracked a very tiny bit previously, growth during the first half of this year has already more than made up the ground that had been lost. Baltimore's current average monthly rent of $1,107, then, is an all-time high.

Just like pretty much every other metro across the country, Jacksonville has seen its apartment market generate some performance momentum so far during 2010. However, this locale took one of the nation's worst beatings during the down portion of the market cycle, so it remains far from reaching healthy status once again.

Apartment absorption in Jacksonville registered at some 2,900 units during 2010's initial six months, far surpassing completions limited to around 500 apartments. Occupancy, then, has made big strides, rising 3 full percentage points since late 2009. Even with that upturn, however, the June occupancy figure was only 89.3 percent. That's the third worst reading across the 64 metros that form the core of MPF Research's national apartment analysis, coming in just ahead of the rates in Houston and Fort Myers.

With overall occupancy so low, it's not surprising that even the top-performing neighborhoods and product niches are struggling. The metro's best neighborhood-level result in submarkets with sizable apartment inventories is the 92.8 percent occupancy in the Mandarin area. Across the various product categories, 1990s-era properties are doing the best with occupancy at 92.5 percent.

Yesterday, there was lots of media coverage highlighting results of a survey that indicates quite a few of today's renters don't expect to ever become home buyers. Specifically, a Harris Interactive poll of about 2,000 folks conducted for real estate search site Trulia.com found that 27 percent of current renters don't anticipate that they'll eventually make the leap to home purchase.

Looking a little more closely at the survey info provided on Trulia's website, only 663 of the 2,000 people surveyed actually are renters, and there's no info provided on what type of housing (apartments, single-family homes, or something else) the renters are leasing. That seems like a pretty small sample to use when making broad-brush statements about a large and diverse group of renters, but let's go ahead and assume that the survey results are accurate. Do they, in fact, mean anything?

The Census Bureau reports that 66.9 percent of American households are homeowners, meaning that 33.1 percent rent. If 27 percent of those renters don't expect to buy at some point, the total pool of all households excluded forever from purchase is just 9 percent.

If you are looking to expand and grow your property management business, you should position your business opportunity as an attractive investment opportunity to the banks and lenders.

While 2nd quarter 2010's 1.2 percent jump in U.S. apartment rents was the first meaningful increase in pricing power seen during the current market cycle, the boost was encouraging widespread. It wasn't just a handful of areas getting back on track ... at least minor upticks occurred almost everywhere.

Across the 64 metros that form the core of MPF Research's apartment market analysis, 56 of them realized effective rent improvement during 2nd quarter, measuring change on a same-store basis. One city (Memphis) registered identical rents in March and June, leaving just seven metros suffering further declines. Quarterly losses of more than 1 percent were limited to Tucson, Las Vegas and New Orleans.

The strong quarterly showing pushed annual rent change into positive territory for a total of 25 metros as of June, up from just seven as of 1st quarter. The nation's top 10 performers for rent growth proved to be an incredibly mixed bunch in terms of general characteristics. They stretched from the East Coast to the West Coast. Some were large, others small. A few maintained their momentum after doing reasonably well during the national downturn, whereas others regained considerable ground that was lost during 2008-2009.

Having a business plan will enable new property management companies and property managers encourage loans and promote growth. A formal business plan is just as important for an established property management company as it is for a new company.


What is a Business Plan?

A business plan is your firm's resume. It defines who you are, what your goals are and what is your revenue model. 

A business plan aligns employees, sales personnel and vendors with the company's goals and operational procedures. A good business plan helps you make good business decisions in allocating resources and handling unexpected situations. 

A good business plan should include a current and pro forma balance sheet, an income statement, and a cash flow analysis.


Why Write a Business Plan?

A Business Plan is an important document in any loan application because it provides organized information about your company and how you will repay borrowed money. A good business plan serves as a blueprint of your organization for outside management of your operation and finances, promotion and marketing of your business, funding, credit from suppliers, and achievement of your goals and objectives.

Before you begin writing your business plan, consider four core questions:

Don't rush into a New Business Venture without answering these questions:
 
* What is the Nature of your service or product?
* What Needs does your business fill?
* Who are the potential customers for your product or service? * Why will they purchase it from you?
* How will you reach your potential customers?
* Where will you get the financial resources to start your business?

Finally, a Business plan is a crucial step for new property management companies and property managers which will reap benefits in the longer run.

While almost every apartment market across the country has posted notably improved overall fundamentals during 2010, few can match the turnaround seen in Portland. The metro's stats looks good for both occupancy and rent change. And, perhaps most impressive of all, recovery is apparent in every single product niche across every single neighborhood.

Portland's apartment occupancy rate stood at 95.8 percent as of June. That's still a little below the peak readings seen in 2006-2007, when occupancy hovered around the 97 percent mark. But, it's important to realize that 2006-2007 wasn't a normal period for the metro. Today's occupancy performance, in fact, is a full percentage point over the norm logged during the past decade as a whole.

Nashville ranks among the U.S. apartment markets recording the most pronounced upturns in performance during 2010. Demand is coming in at very strong levels that well exceed deliveries, driving up occupancy quite rapidly and, in turn, stimulating rent growth.

MPF Research's calculations show Nashville apartment absorption during the January-June 2010 time frame at nearly 4,200 units, compared to roughly 1,000 units of new supply. Apartment demand in Music City perhaps was boosted a bit by flooding that damaged a portion of the total housing stock in May, but the impact doesn't appear to be especially significant. Pointing to that result, apartment demand during the first half of 2010 proved substantial throughout the metro, not just in the neighborhoods where flooding occurred.

Nashville's overall occupancy rate for apartments now has reached 94 percent, up 3.1 percentage points since bottoming at the end of 2009. Notable progress is occurring in all key submarkets except Sumner County, on the metro's far northeast side.

Improved occupancy allowed apartment operators to boost effective rents at an impressive clip of 4 percent during 2010's first half, with most of that growth occurring specifically during 2nd quarter. Year-to-date increases erased the losses seen in 2009's last half, taking annual rent change just past the breakeven point at a positive figure of 0.2 percent.

Building actually started recently on a couple of moderately-sized apartment communities totaling 311 units. However, the total stock under construction in the metro remains under control at just over 800 units, so it won't take much near-term demand to surpass completion levels.

Originally published on July 23, 2010, by Greg Willett

If you have usable rooftop space, did you know that independent power producers, solar energy companies, urban agriculture companies, and more want to lease it from you?

That is right, your rooftop space is a valuable part of your property now.  If you aren't listing it as a site for energy production or urban farming, you are missing out on getting a return from your unused rooftop space. 

When your rooftop space is used as a site for energy production or food production, you get either a flat $/sq. foot lease rate, a split of the profits from the energy or food produced and sold, or a reduction in your energy bill with a Power Purchase Agreement (PPA). You can also get a combination, for example, a flat lease rate plus a PPA.