CoStar Group's Randyl Drummer examines the multifamily pipeline and finds that the Class A construction boom, rather than slowing, is actually gaining momentum in select central business districts (CBDs).
Even though the overall volume of new construction is below its long-term historical average, the concentration of development has largely followed the jobs right into the heart of downtown.
About 60% of new apartment units are now delivering in the top downtown office submarkets as developers and investors follow the job market and target affluent renters. That's up from less than 30% new apartments in the same downtown markets in 2011, according to an analysis of multifamily construction trends by CoStar Portfolio Strategy.
From the 1960s through the 1980s, apartment construction was largely confined to the suburbs. Less than 20% of all apartment construction occurred in traditional downtown office districts.