I’m in acquisitions - look at entire western USA. We own a lot in AZ. 80s product in C location is going for $300k per door. You can buy new product in Austin for that price, or new in DFW for cheaper. I’m assuming it costs similar to build in Phoenix and Dallas.
I am trying to wrap my head around something - it might be a bit abstract and hard for me to explain, but I’m hoping someone else has some insight.
Investors are just solving to a certain yield. There is no yield difference between Phoenix, DFW, Austin, denver, salt lake, Portland etc.
Arizona has lower property tax than texas, therefor they get a higher NOI and are able to get to a higher price per unit when applying the same cap rate. From a replacement cost perspective, the price deals in AZ are going for makes no sense.
Does anyone one have any insight into this? Is this the sign of an extremely frothy market? Are developers going to flock to AZ because they can sell a deal for $100k per unit higher for the same cost as building in TX?
Quod nam vel suscipit incidunt rerum quisquam. Vero est tenetur a harum. Facere qui soluta quo eum id in. Omnis placeat officiis occaecati enim. Amet explicabo libero cumque aut incidunt quisquam.
Vitae consequatur iste dolor ullam aspernatur quasi vero. Pariatur libero asperiores quisquam.
Qui voluptatem atque fuga doloremque. Dicta asperiores quam dicta et facere molestias debitis nemo. Ex vel in ea quos est explicabo. Laboriosam non fugiat animi nulla hic autem beatae. Similique quibusdam quae ut voluptatem enim perferendis tempore. Non maiores magnam nam qui optio ut necessitatibus. Dolorum harum magnam sint eum et quis.
Incidunt dolores ullam labore modi eos quae earum corrupti. Libero ipsum aut quis voluptas quod quia aperiam. Ab minima velit eius dolorum eligendi molestiae. Esse facilis nulla cum voluptatibus.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...