Tom Grillo has nailed this right on the head. Rental prices are high in the Boston metro area and East Cambridge is said by one source to have the highest monthly rental rates. Have you walked around parts of Kendall Square and East Cambridge lately? There are several commercial new construction projects going on and those buildings will bring high paying jobs, most likely.
Read his story below:
Boston Business Journal by Thomas Grillo, Real Estate Editor
Date: Tuesday, July 10, 2012, 11:10am
Single-digit vacancy rates in Boston is driving production of multifamily housing like this one in the Back Bay.
Greater Boston’s apartment market will remain in favor of landlords this year, but as new developments open and rents reach peak levels, residents may seek more affordable living options, according to a new survey.
The Apartment Research Market Report by Marcus & Millichap found the improving employment picture and a severe shortage of supply within Route 128 has reduced the vacancy rate to below three percent. By year’s end, asking rents will reach record highs, which has already ignited a building frenzy throughout Boston, the study found.
By the close of 2012, rents will reach uncharted territory as owners boost asking rents 3.4 percent to $1,805 per month, the survey said. In the previous 12 months, asking rents rose 2 percent, researchers found.
Nearly 1,500 units are under way in Suffolk County, which will come online by 2014 and may ease rent growth. Meanwhile, demand outside Route 128 is gaining steam as young professionals are being priced out of the Boston area. Families and empty nesters are also migrating to the suburbs, where newer developments offer a sense of connection to the community similar to urban settings at more affordable rates.
Developers are capitalizing on this trend and transforming areas near transit stations into densely packed, master-planned communities. The redevelopment of the South Weymouth Naval Air Station, known as Southfield, is one example of this trend. The first phase of the mixed-use project was recently completed and added 225 apartments, townhomes and amenities to the region.
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