Foreign Investors
Like other segments of the real estate industry, the past year has seen increased interest from foreign investors in the national multifamily (apartment) real estate market. Les Shaver made a good post about this here in MFE, Multifamily Executive. No doubt that foreign interest, if continued, will impact capitalization rates and the coastal markets in particular.
The “foreign” investors that have traditionally had the biggest impact here in the Phoenix Metro area are from California, so I took a look at the closed apartment sales for the fourth quarter of 2014. Now, this data hasn’t been scrubbed, it’s from a major data supplier and not all transactions show where the true buyers are from (ie a Delaware LLC) but what I found was that over 40% of the +/- 100 multifamily transactions that did show the true buyer, were from California. In 2012, approx 33% of the true buyers were reported to have been from California. A deeper pool of potential buyers is good news for sellers in the Arizona market, though it may lead to some locals shaking their heads as prices continue to strengthen.