Are Multifamily Investor Preferences Shifting? via Multifamily Executive Magazine

Recent multifamily investment volumes indicate an early but potentially growing emphasis on low-rating properties. Indeed, as the chart below shows, from the first quarter of 2010 through the first quarter of 2013, Class B and C sales transactions were substantially higher than those for Class A properties. (The data do not reflect the recent, $16 billion Archstone–AvalonBay–Equity Residential transaction, in order to avoid skewing the results.)

A further look at the Class A and B transactions shows that their shares have changed gradually over time. In 2010, following the recession, the percentage of Class A transactions was close to 30 percent of all sales, and Class B transactions represented close to 40 percent. Between 2011 and 2012, however, the proportion of Class A transactions slipped toward the 20 percent to 30 percent range, while the portion of Class B transactions moved up, fluctuating above 40 percent.

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