Return to story

Apartment-hunting appealing to many

March 24, 2012 12:10 am

bz0324rentPC1.jpg

South Carolina-based Johnson Development Associates' latest apartment complex, near Spotsylvania Regional Medical Center, won't be ready until June, but three units already are leased. There will be 260 units.

BY CATHY JETT

Johnson Development Associates won't finish its latest apartment complex, which is going up across from Spotsylvania Regional Medical Center, until June 1.

But the South Carolina-based company, which built The Haven at Celebrate Virginia near Wegmans last summer, already has leased three units in the unfinished complex and fielded numerous inquiries about the remaining 257.

"We think the demand is very high in the Fredericksburg community," said Ben Graves, president of Johnson Development's multi-family division.

The company's first complex, for example, was 96 percent leased when the company sold it last December for $39.4 million to MAA, a real-estate investment trust based in Tennessee. It has been renamed Seasons at Celebrate Virginia.

"It was the fastest lease-up in all of Northern Virginia," said Graves, adding that Johnson Development plans to break ground for another apartment complex next to Seasons in two months.

Currently, occupancy rates for apartments within a 10-mile radius of the city of Fredericksburg range from 95 to 97 percent. Graves said his company thinks this area can sustain an additional 300 to 500 apartment units without saturating the market.

"Even with our new community, we didn't see a marked drop in our competitors' occupancy rates," he said.

Cobblestone Square, which also has Class A apartments, is hoping to have similar success, said property manager Jennifer Marsh. Since it began accepting applications last August, it has preleased or leased 139 of the 314 apartments that have been built or are under construction.

Her goal is to have the first three of the complex's planned six buildings 95 percent completed and leased by the end of October.

"We're seeing a lot of people moving in the warmer months, so we're heading up on the peak season," Marsh said.

Demand for rentals--including apartments, condos and houses--has been on the rise since the recession hit. Some, such as upwardly mobile 20-somethings, like the idea of having someone else take care of maintenance and landscaping. Plus, they don't have to worry about selling a house if they have to move to accept a job somewhere else.

"Owning a home is not so much the cornerstone of wealth as it has been in the past," Graves said.

In some cases, even homeowners are renting a second place. Cobblestone has a number of tenants who want to be near the train station so they can take VRE to their jobs in Northern Virginia or Washington during the week, then go home to such places as Chester or Virginia Beach on weekends, Marsh said.

For those who have lost their homes due to foreclosures or short sales, renting is often their only option. Others who haven't taken the plunge into homeownership may still be wary due to concerns about job security or are waiting to see if housing prices have hit bottom.

"Due to the impact of the economy, we're definitely seeing more people want to rent," said Cheryl Saunders, an associate broker and property manager at Johnson & Glazebrook.

She said that demand for rentals was especially strong this past winter, which is typically a slow time. Recently, there were just 250 properties listed in the Metropolitan Realtor Information System for Fredericksburg and the counties of Caroline, King George, Orange, Spotsylvania and Stafford.

As a result, Saunders said that over the past few months the landlords she works with have been raising rates as much as 10 percent as they renew leases.

"If owners don't want to rock the boat, [the increase is] zero," she said. "It's up to the individual landowners."

The Washington Metropolitan Statistical Area, which includes the city of Fredericksburg and counties of Stafford and Spotsylvania, already has the highest fair market rent in the state. That's the amount of money a property would rent or lease for if it were available at this time.

Rent ranges from $1,328 for a one-bedroom to $2,542 for a four-bedroom, according to the National Low Income Housing Coalition's new report, Out of Reach 2012: American's Forgotten Housing Crisis. Locally, prices for a one-bedroom at Cobblestone range from $1,010 to $1,225, and will be about $1,300 at The Haven.

Cathy Jett: 540/374-5407
Email: cjett@freelancestar.com





Copyright 2014 The Free Lance-Star Publishing Company.