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Market Report

Indianapolis Multifamily Market Report

2Q 2023

Manufacturing and Trade Drive Apartment Demand;
Record Deliveries Pressure Carmel Fundamentals

Industrial growth spurs apartment needs in western suburbs. Transportation and warehousing employment in Indianapolis stood nearly 24 percent above the pre-pandemic level in February of this year, well-exceeding the 5 percent growth in total jobs during that span. The robust expansion of the local industrial sector is fueling demand for apartments as the local workforce grows. West of downtown in Hendricks County, industrial absorption exceeded 2.7 million square feet last year. These new positions that stem from this leasing activity will fuel demand for units in Far West Indianapolis Suburbs at a time when Class C vacancy is extremely tight and local Class A and B availability is below the metrowide average. Residents desiring closer proximity to the city and urban amenities are renting in the Southwest submarket near the airport. This activity helped push Class A and B rent growth above 10 percent, aided by an upper-tier vacancy rate that is the lowest among metro submarkets. 
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