April 29, 2013

Rental demand in Portland is through the roof

The city hopes to see at least 800 more apartments built as demand forces up rents.

By Randy Billings rbillings@pressherald.com
Staff Writer

(Continued from page 1)

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Brit Vitalius, who owns 20 rental units in Portland, sits in a studio apartment similar to one he rented for $695. He said demand is so high he’s getting more tenant applicants than he needs.

John Ewing/Staff Photographer

As a Realtor, Collins focuses mostly on home sales, but she is often asked about rentals in Portland. She usually refers prospective tenants to Portland rental agents with a key piece of advice.

"I tell them to be a bulldog on a pant leg to get help," she said. "It's very tough out there right now."

Brit Vitalius of Vitalius Real Estate Group owns 20 rental units in Portland. When a West End studio apartment opened up, Vitalius said he had no problem finding a qualified tenant. In fact, he had too many.

He recently showed the studio to eight prospective tenants over the course of an hour. Six were qualified and would have made great tenants, he said.

Rather than draw a name from a hat, Vitalius went with the first person to apply, because she knew someone in the building and promptly provided a check. The 180-square-foot studio, the equivalent of a 12-by-15-foot room, was rented for $695.

"I probably could have asked for more," Vitalius said. "I wish I had more units."

Greg Shinberg is the local consultant for Miami-based Federated Cos., the "midtown" developer.

Shinberg sees a demand for new, market-rate housing in a city with an old housing stock. He has seen the demand for new market-rate units first-hand as part-owner of 645 Congress St. The 56-unit building has been full since the fall of 2010, six months after it opened, he said.

"There is still quite a bit of pent-up demand in Portland," Shinberg said. "There is just a funky cool to (Portland) that people enjoy."

The city has made increasing housing options a priority. A 2002 housing plan called for the creation of 3,000 new housing units in the city, with a goal of having 25 percent of the total number of housing units in Cumberland County.

The city has held steady at 24 percent of the units in the county, even though 1,949 units, including 912 rental units, have been added in the past decade, Davis said.

The city has invested $7 million to help create 672 of those units, Davis said.

Meanwhile, the city's housing plan calls for the full implementation of the Bayside vision of adding 800 units over five years with an eye toward three-bedroom rental units for families.

Shinberg said Federated is still working out the details, such as square footage and number of bedrooms, for the 675 units envisioned over the next decade.

The first phase of 190 units in a 165-foot-tall tower is expected to get under way later this year and will help alleviate the demand, he said.

But real estate professionals offered different assessments of the project's prospects for success and its impact on the local market, which is driven by young professionals and empty-nesters.

Collins said the developer needs to build units that are at least 1,200 square feet with in-house laundry to be successful.

But Vitalius, the president of the Southern Maine Landlord Association, said many of his prospective tenants are young "hipsters" who want to live in a two- or three-story building. High-rise apartments, like those planned in midtown, could push the apartments out of reach for many people looking to move to Portland, he said.

"It's going to be completely different than the units people are looking for," Vitalius said.

Some real estate professionals believe the rental market will cool down as the housing market heats up, but Shinberg said demand will always be high here.

"Portland is kind of a unique experience," Shinberg said, noting the coastal city's trails, restaurants, arts scene and its walkable neighborhoods. "(And) there are people who don't want the risk of ownership."

Randy Billings can be contacted at 791-6346 or at:

rbillings@mainetoday.com

Twitter: @randybillings

 

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Today's poll: Apartment hunting

Have you had trouble finding an apartment in Portland?

Yes

No

View Results