Multifamily demand in Baltimore is slowly picking up, buoyed by steady hiring and population gains, as well as rising incomes. Rent growth was moderate for most of 2017, and with a wave of new stock coming online, occupancy ticked down to 94.2 percent as of February 2018.
Employment growth was strongest in education and health services, anchored by landmark institutions such as Johns Hopkins Hospital and the University of Maryland Medical System. New legislation passed by the Maryland General Assembly could bring free tuition to thousands of low- and middle-income community college students, further expanding higher education in the city and creating a better educated labor pool. This dynamic would make Baltimore more attractive to employers, while continuing to fuel tech and STEM job growth. Office-using employment is also boosting demand for space across the metro; the 28-story One Light building is the first new office tower to rise in the CBD in more than a decade.
Multifamily transaction volume in 2017 nearly matched the previous year’s cycle high of $1.9 billion. Developers are also active, especially downtown, which had the most units under construction as of March. Absorption is expected to keep up with the spate of new supply, generating modest rent growth of 1.5 percent in 2018.
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