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Market Report

Indianapolis Multifamily Investment Forecast

2022 Outlook

Diminished Pipeline Benefits Existing Rentals;
Investors Eye Return to the Core

Robust rental demand and limited construction boost outlook. Net absorption has outpaced completions every year since 2016, causing a steady decrease in vacancy over the same period. Moderate development will help keep vacancy tight in 2022 with expected completions growing inventory by just 1.1 percent, a pace half of the national expansion rate. Recent and upcoming deliveries outside the core are concentrated in the far northern suburbs, like Carmel and Fishers, where Class A demand is strongest and new buildings typically lease up quickly. Meanwhile, Downtown has recovered from pandemic-related renter demand decreases as vacancy has receded to near pre-COVID-19 levels. The core is home to employers in the expanding technology and biosciences sectors, headlined by Salesforce and Eli Lilly, providing high-income jobs to Class A renters. FedEx and Radial recently announced intentions to employ more entry-level workers at their fulfillment centers, bolstering lower tier rental demand in nearby neighborhoods.
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