{"id":8609,"date":"2022-10-25T17:53:40","date_gmt":"2022-10-25T21:53:40","guid":{"rendered":"https:\/\/www.lee-associates.com\/southflorida\/?p=8609"},"modified":"2022-10-25T17:59:28","modified_gmt":"2022-10-25T21:59:28","slug":"rising-interest-rates-slow-apartment-deals-across-south-florida","status":"publish","type":"post","link":"https:\/\/www.lee-associates.com\/southflorida\/2022\/10\/25\/rising-interest-rates-slow-apartment-deals-across-south-florida\/","title":{"rendered":"Rising interest rates slow apartment deals across South Florida"},"content":{"rendered":"<div id=\"pl-8609\"  class=\"panel-layout\" ><div id=\"pg-8609-0\"  class=\"panel-grid panel-no-style\" ><div id=\"pgc-8609-0-0\"  class=\"panel-grid-cell\" ><div id=\"panel-8609-0-0-0\" class=\"so-panel widget widget_sow-image panel-first-child\" data-index=\"0\" ><div\n\t\t\t\n\t\t\tclass=\"so-widget-sow-image so-widget-sow-image-default-c67d20f9f743-8609\"\n\t\t\t\n\t\t>\n<div class=\"sow-image-container\">\n\t\t\t<a href=\"https:\/\/www.bizjournals.com\/southflorida\/news\/2022\/10\/24\/rising-interest-rates-slowing-apartment-deals.html\"\n\t\t\ttarget=\"_blank\" rel=\"noopener noreferrer\" \t\t>\n\t\t\t<img \n\tsrc=\"https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2022\/10\/PR-Banner-Media-Feature_2021-SFBJ-MJ.png\" width=\"1250\" height=\"521\" srcset=\"https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2022\/10\/PR-Banner-Media-Feature_2021-SFBJ-MJ.png 1250w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2022\/10\/PR-Banner-Media-Feature_2021-SFBJ-MJ-512x213.png 512w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2022\/10\/PR-Banner-Media-Feature_2021-SFBJ-MJ-768x320.png 768w\" sizes=\"(max-width: 1250px) 100vw, 1250px\" title=\"South Florida Business Journal Discusses Interest Rates, Construction Costs and Multifamily Market with Lee &amp; Associates Principal, Matthew Jacocks\" alt=\"South Florida Business Journal Discusses Interest Rates, Construction Costs and Multifamily Market with Lee &amp; Associates Principal, Matthew Jacocks\" \t\tclass=\"so-widget-image\"\/>\n\t\t\t<\/a><\/div>\n\n<\/div><\/div><div id=\"panel-8609-0-0-1\" class=\"so-panel widget widget_sow-editor panel-last-child\" data-index=\"1\" ><div\n\t\t\t\n\t\t\tclass=\"so-widget-sow-editor so-widget-sow-editor-base\"\n\t\t\t\n\t\t>\n<div class=\"siteorigin-widget-tinymce textwidget\">\n\t<h2 class=\"detail__headline \"><strong>Rising interest rates slow apartment deals across South Florida<\/strong><\/h2>\n<div class=\"item__title item__title--smaller\">By\u00a0<a class=\"u-link u-link-color\" href=\"https:\/\/www.bizjournals.com\/southflorida\/bio\/42604\/Erik+Bojnansky\" rel=\"author\" data-ct=\"APT: Reporter byline name\">Erik Bojnansky<\/a>\u00a0<span class=\"hidden--xs hidden--sm\">\u00a0\u2013\u00a0<\/span>\u00a0Reporter, South Florida Business Journal<\/div>\n<div class=\"item__title item__title--smaller\">Oct 24, 2022<\/div>\n<p>&nbsp;<\/p>\n<p class=\"content__segment combx paywall__content\">Rising interest rates are making it difficult for developers to build more apartments and investors to close on multifamily building deals.<\/p>\n<p class=\"content__segment combx paywall__content\"><a href=\"https:\/\/www.bizjournals.com\/southflorida\/search\/results?q=Matthew%20Jacocks\">Matthew Jacocks<\/a>, principal of <a href=\"https:\/\/www.lee-associates.com\/southflorida\/our-team\/matthew-jacocks\/\">Lee &amp; Associates Commercial Real Estate Services' South Florida<\/a> office, said rents will likely remain high and vacancies low as more people move from other parts of the nation to South Florida to avoid state income taxes and over-regulation. But with construction costs 25% higher than in December 2021, and the cost of lending elevated, market conditions for new developments are less than ideal.<\/p>\n<p class=\"content__segment combx paywall__content\">\"Some projects may not happen, get delayed or not make any sense,\" he said.<\/p>\n<p class=\"content__segment combx paywall__content\">At the same time, Jacocks said there's a \"ton of capital\" willing to purchase existing apartment buildings, but they're having trouble finding landlords willing to part with their properties at a decent price. And when a landlord does name a price, it's often for a highly inflated amount, he added.<\/p>\n<p class=\"content__segment combx paywall__content\">\"Why would someone who has a beautiful property in South Florida sell...and then be in a position of having to buy [another building] at higher interest rates?\" Jacocks asked.<\/p>\n<p class=\"content__segment combx paywall__content\">Most apartment building owners who sell, unless they're intent on retiring and cashing out, will reinvest their profits in another multifamily property in what is known as a 1031 exchange, Jacocks said. Under the federal tax code, an investor who sells a real estate property for a similar one can defer capital gains taxes.<\/p>\n<p class=\"content__segment combx paywall__content\">Even without the higher interest rates, buying an apartment building in South Florida has become increasingly expensive. In 2019, prior to the pandemic, apartment buildings sold at an average price of $213,000 per unit. By 2021, the average price per unit reached $278,000 a unit. Year-to-date apartment buildings trade at $302,000 per unit, according to <a href=\"https:\/\/www.lee-associates.com\/southflorida\/2022\/10\/19\/lee-associates-south-florida-q3-report-south-floridas-retail-market-on-fire-industrial-vacancies-remain-at-historic-lows\/\">figures by Lee &amp; Associates Commercial Real Estate Services<\/a>.<\/p>\n<p class=\"content__segment combx paywall__content\">The rise in value correlated with the rise in rents. In 2019, the average monthly market rent of an apartment unit was $1,628. In 2021, the average rent was $1,960 a month. By the third quarter of 2022, the average monthly rent reached $2,048 a month.<\/p>\n<p class=\"content__segment combx paywall__content\">But, this year's third-quarter rents are slightly lower than the second quarter's average rent of $2,056 a month. Jacocks said this is a sign that rents are no longer rising as high as 32% year-over-year as they had earlier this year and, instead, are plateauing. It's a situation that real estate investors have long expected, Jacocks said.<\/p>\n<p class=\"content__segment combx paywall__content\">\"You can't squeeze water out of a rock. At some point you got to reach a cap,\" he said.<\/p>\n<p><a href=\"https:\/\/www.bizjournals.com\/southflorida\/news\/2022\/10\/24\/rising-interest-rates-slowing-apartment-deals.html\">READ MORE...<\/a><\/p>\n<p>&nbsp;<\/p>\n<\/div>\n<\/div><\/div><\/div><\/div><div id=\"pg-8609-1\"  class=\"panel-grid panel-no-style\" ><div id=\"pgc-8609-1-0\"  class=\"panel-grid-cell\" ><div id=\"panel-8609-1-0-0\" class=\"so-panel widget widget_siteorigin-panels-builder panel-first-child\" data-index=\"2\" ><div class=\"panel-widget-style panel-widget-style-for-8609-1-0-0\" ><div id=\"pl-w63585ae4e8449\"  class=\"panel-layout\" ><div id=\"pg-w63585ae4e8449-0\"  class=\"panel-grid panel-has-style\" ><div class=\"panel-row-style panel-row-style-for-w63585ae4e8449-0\" ><div id=\"pgc-w63585ae4e8449-0-0\"  class=\"panel-grid-cell\" ><div id=\"panel-w63585ae4e8449-0-0-0\" class=\"so-panel widget widget_sow-image panel-first-child\" data-index=\"0\" ><div\n\t\t\t\n\t\t\tclass=\"so-widget-sow-image so-widget-sow-image-default-c67d20f9f743\"\n\t\t\t\n\t\t>\n<div class=\"sow-image-container\">\n\t\t\t<a href=\"https:\/\/www.bizjournals.com\/southflorida\/news\/2022\/10\/24\/rising-interest-rates-slowing-apartment-deals.html\"\n\t\t\ttarget=\"_blank\" rel=\"noopener noreferrer\" \t\t>\n\t\t\t<img \n\tsrc=\"https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2021\/12\/SFBJ-512x159.jpg\" width=\"512\" height=\"159\" srcset=\"https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2021\/12\/SFBJ-512x159.jpg 512w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2021\/12\/SFBJ-768x239.jpg 768w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2021\/12\/SFBJ.jpg 1094w\" sizes=\"(max-width: 512px) 100vw, 512px\" alt=\"\" \t\tclass=\"so-widget-image\"\/>\n\t\t\t<\/a><\/div>\n\n<\/div><\/div><div id=\"panel-w63585ae4e8449-0-0-1\" class=\"so-panel widget widget_sow-button panel-last-child\" data-index=\"1\" ><div class=\"panel-widget-style panel-widget-style-for-w63585ae4e8449-0-0-1\" ><div\n\t\t\t\n\t\t\tclass=\"so-widget-sow-button so-widget-sow-button-leeassoc-be638d0e64b7\"\n\t\t\t\n\t\t><div class=\"leeassoc-so-btn-base ow-button-base ow-button-align-center\">\r\n\t<a href=\"https:\/\/www.bizjournals.com\/southflorida\/news\/2022\/10\/24\/rising-interest-rates-slowing-apartment-deals.html\" class=\"sowb-button ow-icon-placement-left ow-button-hover\" target=\"_blank\" rel=\"noopener noreferrer\" \t\t>\r\n\t\t<span>\r\n\t\t\t<span class=\"sow-icon-fontawesome sow-far\" data-sow-icon=\"&#xf1ea;\"\n\t\tstyle=\"\" \n\t\taria-hidden=\"true\"><\/span>\r\n\t\t\tRead Full Article at South Florida Business Journal\t\t<\/span>\r\n\t<\/a>\r\n<\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><\/div><div id=\"panel-8609-1-0-1\" class=\"so-panel widget widget_sow-editor panel-last-child\" data-index=\"3\" ><div\n\t\t\t\n\t\t\tclass=\"so-widget-sow-editor so-widget-sow-editor-base\"\n\t\t\t\n\t\t>\n<div class=\"siteorigin-widget-tinymce textwidget\">\n\t<h3><strong>About Lee &amp; Associates South Florida<\/strong><\/h3>\n<p>Lee &amp; Associates South Florida is a fully vertical commercial real estate brokerage firm focused on industrial, office, retail, multifamily, investment and land sectors. Our dedicated team of professionals is led by Matthew Rotolante, CCIM, SIOR a 4th generation South Florida native in a family that has owned and operated commercial property here since 1928. Lee &amp; Associates is the largest agent owned brokerage in the nation with Senior Agent\u2019s ability to earn profit share resulting in the highest splits while still receiving full resources, support and leads from our national network. Our collaborative and cheerful culture allows for open communications throughout the company, fostering the sharing of information and best practices to better enable client decision making.\u00a0 The Lee &amp; Associates\u2019 robust national network that sold and leased nearly $32.4 Billion in 2021 offers clients a cross-market platform of expertise and deal opportunities across all asset specialties and representation roles. For the latest news from Lee &amp; Associates South Florida, visit <a href=\"http:\/\/www.lee-associates.com\/\">leesouthflorida.com<\/a>\u00a0or follow us on\u00a0<a href=\"https:\/\/www.facebook.com\/leesouthflorida\">Facebook<\/a>,\u00a0<a href=\"https:\/\/www.linkedin.com\/company\/leesouthflorida\">LinkedIn<\/a>,\u00a0<a href=\"https:\/\/twitter.com\/leesouthflorida\">Twitter<\/a>\u00a0and\u00a0<a href=\"http:\/\/www.instagram.com\/leesouthflorida\">Instagram<\/a>, our company <a href=\"https:\/\/www.lee-associates.com\/southflorida\/news\/\">local news<\/a>.<\/p>\n<h3><strong>About Lee &amp; Associates<\/strong><\/h3>\n<p>Lee &amp; Associates is a commercial real estate brokerage sales, leasing and management firm. Established in 1979, Lee &amp; Associates has grown its service platform to include over 75 offices\u00a0in the United States and Canada. Lee &amp; Associates is the largest agent owned commercial real estate brokerage where agents get the greatest return for their efforts and hence are more committed and better enabled to provide superior results for their customers. \u00a0For the latest news from Lee &amp; Associates, visit\u00a0<a href=\"http:\/\/www.lee-associates.com\/\">lee-associates.com<\/a>\u00a0or follow us on\u00a0<a href=\"https:\/\/www.facebook.com\/LeeAssociatesCRE\">Facebook<\/a>,\u00a0<a href=\"https:\/\/www.linkedin.com\/company\/lee-and-associates\">LinkedIn<\/a>,\u00a0<a href=\"https:\/\/twitter.com\/LeeAssociatesRE\">Twitter<\/a>\u00a0and\u00a0<a href=\"http:\/\/www.linkbylee.com\/\">Link<\/a>, our company blog.<\/p>\n<\/div>\n<\/div><\/div><\/div><\/div><div id=\"pg-8609-2\"  class=\"panel-grid panel-has-style\" ><div class=\"panel-row-style panel-row-style-for-8609-2\" ><div id=\"pgc-8609-2-0\"  class=\"panel-grid-cell\" ><div id=\"panel-8609-2-0-0\" class=\"so-panel widget widget_sow-image panel-first-child panel-last-child\" data-index=\"4\" ><div\n\t\t\t\n\t\t\tclass=\"so-widget-sow-image so-widget-sow-image-default-8b5b6f678277-8609\"\n\t\t\t\n\t\t>\n<div class=\"sow-image-container\">\n\t\t\t<a href=\"https:\/\/www.lee-associates.com\/southflorida\/?page_id=7118\"\n\t\t\t\t\t>\n\t\t\t<img \n\tsrc=\"https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-scaled.jpg\" width=\"2560\" height=\"384\" srcset=\"https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-scaled.jpg 2560w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-300x45.jpg 300w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-1024x154.jpg 1024w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-768x115.jpg 768w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-1536x230.jpg 1536w, https:\/\/www.lee-associates.com\/southflorida\/wp-content\/uploads\/sites\/62\/2020\/02\/Blog-Footer_Multifamily-Specialty-2048x307.jpg 2048w\" sizes=\"(max-width: 2560px) 100vw, 2560px\" title=\"Blog Footer_Multifamily Specialty\" alt=\"\" \t\tclass=\"so-widget-image\"\/>\n\t\t\t<\/a><\/div>\n\n<\/div><\/div><\/div><\/div><\/div><\/div>","protected":false},"excerpt":{"rendered":"<p>Rising interest rates slow apartment deals across South Florida By\u00a0Erik Bojnansky\u00a0\u00a0\u2013\u00a0\u00a0Reporter, South Florida Business Journal Oct 24, 2022 &nbsp; Rising interest rates are making it difficult for developers to build more apartments and investors to close on multifamily building deals. Matthew Jacocks, principal of Lee &amp; Associates Commercial Real Estate Services&#8217; South Florida office, said rents will likely remain high and vacancies low as more people move from other parts of the nation to South&#8230;<\/p>\n","protected":false},"author":76,"featured_media":8610,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,1817,1818,108],"tags":[1812],"class_list":["post-8609","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-investment-sale","category-land-development","category-multifamily","tag-matthew-jacocks"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.7 (Yoast SEO v28.7) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Rising interest rates slow apartment deals across South Florida - Lee &amp; Associates South Florida<\/title>\n<meta name=\"description\" content=\"Matthew Jacocks speaks with the South Florida Business Journal on the difficulties developers and investors of apartment properties are....\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.lee-associates.com\/southflorida\/2022\/10\/25\/rising-interest-rates-slow-apartment-deals-across-south-florida\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Rising interest rates slow apartment deals across South Florida\" \/>\n<meta property=\"og:description\" content=\"Matthew Jacocks speaks with the South Florida Business Journal on the difficulties developers and investors of apartment properties are....\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.lee-associates.com\/southflorida\/2022\/10\/25\/rising-interest-rates-slow-apartment-deals-across-south-florida\/\" \/>\n<meta property=\"og:site_name\" content=\"Lee &amp; 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