Hartford, CT

Does anyone have any insight on the Multi Family Real Estate market in Hartford, CT? I understand the area has a low median income and the rents are not high at all but what do you see this place being in 10,20,30 years? Cap Rates average around 8-10%

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Connecticut is going to take a long time to recover. In fact, it's still on the downswing. GE left and I have inside knowledge that a few other major employers will announce they will be leaving in the next couple of years.

Let's take that presumptive fact and apply the general real estate truth that tougher markets get hit hardest in downturns and recover the slowest. Right now, Hartford is doing quite well compared to what it was at the bottom of the crisis - $/unit on class C apartments are up A LOT. In my opinion it's got to be at or near the top for this current market cycle. It's very hard to get out of these deals at a profit when you're not at the top of the market.

If you're buying in Hartford please don't go near the North End. It's not just a bad buy it's downright dangerous for people of lighter skin colors to be there at the wrong time of day. Otherwise, it's a cash flow play and I would assume that if you exit within the next 10 years you should model very small rent increases and a very similar exit price. You can't assume that if you buy today at the highest prices Hartford has seen in a long time that it will be much higher down the road.

To Landowner: are you referring to the EQR portfolio of over 700 units? That's in the suburbs and some of the properties are in decent locations.

 

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