• Firm multifamily demand was evidenced by the 1,210 units absorbed in 2017 and though that represents a decline of 29.2% from a cyclical peak in 2016, it remains 1.5% above the 10-year average.

  • The relatively low vacancy rate of 3.9% ticked up for the second quarter in a row but declined by 40 basis points (bps) year over year.

  • New deliveries cooled from peak levels with 645 units completed in 2017.

  • In 2017, the average monthly effective rent of $1,440 increased by 0.6% from the prior year but was the weakest growth rate since 2012.

  • Investment sales fell by 40% from a record 2016, making it the third best year since the recession, but activity was still elevated with sales totaling over $1.4 billion.

  • Cap rates for stabilized suburban assets held firm as private buyers searched for value-add opportunities. Multifamily cap rates in the Inland Empire are some of the nation’s lowest and local CBRE professionals expect no change for H1 2018. NCREIF returns moderated from 15.7% in 2016 to 12.9% in 2017.