GSA Daily staff report
Published July 8, 2009

The supply of rental housing in the Greenville-Spartanburg market rose by 505 units so far in 2009, according to new statistics from Real Data, a Charlotte-based multi-family market analyst.

In 2008, the region had the largest increase in new supply in 10 years, Real Data reported.

“Although development has slowed, new supply is still forecast to outpace demand. There were 525 new units started in the first half of 2009 and 764 units are under-construction,” the analyst said.

One major apartment complex is under development near the intersection of Woodruff Road and Interstate 85 in Greenville. Columbus, Ga.-based Flournoy Development Co. is starting work on a 346-unit apartment complex. The Verandas at The Point is expected to begin leasing apartments by late December or January. It is located across the street from The South Financial Group’s corporate campus that is under construction, and which the bank holding company has said it will try to sell.

Blake Breimann, assistant project manager, said his company is optimistic about the prospects for the Greenville rental market.

“We believe that by delivering units at the end of this year we could be coming into the market at just the right time, since there is likely to be very little new Class A apartment product being delivered over the next 12 to 18 months,” he said. “While the remainder of this year is likely to be tough on a macroeconomic level we are hopeful that we will see signs of recovery throughout 2010 that will lead into 2011, especially related to job growth.”

Flournoy has plans for a second phase comprising another 346 apartments, he said, but a decision to go forward on phase two will be market driven and so far has no start date.

There are 1,743 units proposed in the market.

The average rental rate for the region was $636. The average rent for a one bedroom was $544, two bedrooms rented for an average of $649 and three bedrooms rented for $781.

Same-store rents have declined by (-3.5%) or (-$23.04) in the first half of this year, as employment has declined and demand has weakened, Real Data reported, and rental rates are expected to remain flat as occupancy rates remain below 88%.