Job Gains Sustain Demand in Tampa
Above-average population and employment gains have generated a fast absorption of new multifamily product. As a result, rents went up 4.0 percent year-over-year through May.
Tampa rent evolution, click to enlarge
The Tampa–St. Petersburg multifamily market has several factors keeping it stable: Above-trend population and employment gains have created healthy demand, pushing rents up 4.0 percent to $1,200—trailing the $1,381 national average. The area’s main draws are relative affordability compared to top markets, as well as a strengthening economy that’s adding jobs at an above-average rate.
Employment growth has been diverse, with the financial activities and education and health services sectors leading the expansion, adding 6,700 and 6,600 jobs, respectively. The construction sector is also strong and expected to expand, aided by the $3 billion redevelopment project set to change Tampa’s skyline and double its downtown size: the 9 million-square-foot Water Street Tampa project scheduled for completion in 2027.
Given the declining return environment, investors are racing to find higher-yield potential in high-growth secondary markets, pushing the per-unit price in Tampa to $146,389, surpassing the $145,823 national average for the first time this cycle. More than $690 million in multifamily assets traded in the metro this year through April. Apartment construction is hot, with more than 8,000 units underway and an additional 31,400 in various planning stages. Yardi Matrix expects that rent growth will reach 3.9 percent by year-end.
