JOB GROWTH, IN-MIGRATION
TO FUEL APARTMENT DEMAND IN AUSTIN

AUSTIN, Texas, Feb. 4, 2010 – In Austin, the robust employment growth that supported one of the healthiest local economies prior to the recent downturn is anticipated to resume in the coming months, attracting job seekers from areas deeply maligned by the recession, according to the 2010 National Apartment Report by Marcus & Millichap, the nation’s largest real estate investment services firm. A recovery in the global economy will be particularly beneficial for Austin firms, as technology sales in emerging markets will revive the local manufacturing sector, which has declined by 15 percent since peaking in 2007.

“Many investors are expected to remain on the sidelines in the first half of the year as the impact of distressed assets on valuations materializes,” says J. Michael Watson, regional manager of Marcus & Millichap’s Austin office.

Following are some of the most significant aspects of the Austin Apartment Research Report:

• The rate of job growth is anticipated to gain steam as 2010 progresses. Companies are forecast to expand local payrolls at a 2.5 percent clip this year with the addition of 19,000 positions. In 2009, total employment contracted by 6,000 jobs.
• A sharp reduction in development activity is expected in 2010 as 2,500 units come online, significantly below the 7,900 apartments that were delivered last year.
• Population gains and job growth will fuel a 2.1 percent increase in apartment demand this year, resulting in a 40 basis point improvement in vacancy to 10.6 percent.
• Asking rents are forecast to rise 0.6 percent in 2010 to $849 per month while effective rents retreat 0.7 percent to $752 per month .Three years of concession burn-off will be lost by year end.

Also included in the report is the firm’s annual National Apartment Index (NAI), a snapshot analysis that ranks 44 apartment markets based on a series of 12-month forward-looking supply and demand indicators. Austin moves up four places this year to No. 16. Washington, D.C., retained the top spot in the NAI for the second consecutive year, as ongoing government spending will fuel metrowide hiring and apartment demand. San Diego, No. 2, rose four places due to expectations for resumed employment and household growth. New York City, which ended 2009 as the tightest apartment market in the country, jumped five places in the index to No 3. Despite tight vacancy, rents in Minneapolis-St. Paul, No. 4, continue to contract, causing the market to slip one spot this year. Job growth in Philadelphia will lag the nation in 2010, easing the metro down three places to round out the top five.

For a copy of Marcus & Millichap’s National Apartment Report and the complete NAI rankings, visit www.MarcusMillichap.com.

With more than 1,200 investment professionals in offices nationwide, Marcus & Millichap Real Estate Investment Services is the largest firm specializing in commercial real estate investment services in the nation. Marcus & Millichap closed 3,441 transactions in 2009, the highest of any commercial real estate brokerage firm. Founded in 1971, the firm has perfected a powerful system for marketing properties that combines product specialization, local market expertise, the industry’s most comprehensive research, state-of-the-art technology and relationships with the largest pool of qualified investors nationally.

Atlanta • Austin • Baltimore • Birmingham • Boise • Boston • Brooklyn • Central Illinois • Charlotte • Charlotte Uptown • Chicago • Chicago Downtown • Cincinnati • Cleveland • Clinton • Columbia • Columbus • Dallas • Denver • Des Moines • Detroit • Encino • Ft. Collins • Ft. Lauderdale • Ft. Worth • Grand Rapids • Honolulu • Houston • Indianapolis • Jackson • Jacksonville • Kansas City • Lafayette • Las Vegas • Little Rock • Long Beach • Los Angeles • Louisville • Madison • Manhattan • Memphis • Miami • Milwaukee • Minneapolis • Nashville • New Haven • New Jersey • Newport Beach • Oak Brook • Oakland • Oklahoma City • Omaha • Ontario • Orlando • Palo Alto • Philadelphia • Phoenix • Portland • Providence • Raleigh • Reno • Reston • Sacramento • Salt Lake City • San Antonio • San Diego • San Francisco • Santa Fe • St. Louis • Seattle • Tampa • Tucson • Vero Beach • Washington, D.C. • Western Massachusetts • West Los Angeles • Williamsburg