Market highlights:
PROJECTIONS FOR CENTRAL FLORIDA
• Buyers will continue to show strong interest in Orlando multi-family assets due to price declines and projected fundamental improvement
• The following submarkets are projected to outperform the MSA: Altamonte Springs/Longwood, SW Orange County, Winter Park/Maitland, Winter Springs/Casselberry
• New construction is projected to be limited over the next few years, due to the scarcity of multi-family zoned sites, the increase of impact fees and a cautious lending environment
• Condo to apartment “reversions” are largely absorbed from a rental standpoint, which should help boost fundamentals in the second half of 2009
• Fannie Mae and Freddie Mac will continue to be the only choice in financing moving forward until early 2010
• Demand will be very high for attractive assumable debt
• Demand for rental units will exceed the supply of new units under construction
• Rent and occupancy will stay relatively flat until mid-2009, but will increase consistently thereafter through 2013
• Bank owned sales of failed condo conversions will increase in 2009
• Cap rates are likely to increase by mid 2009
• Orlando is poised for strong rent growth in the latter part of 2009 and early 2010.
NEW CONSTRUCTION ACTIVITY• Orlando’s total rental pool is about 141,000 units
• Only a modest 2,722 market-rate rental units will be delivered in 2009
• Orlando will see less than 1,700 units delivered in 2010
• Orlando averaged over 10,000 new units annually from 1999 to 2002
• Almost all the deliveries will be in the first 3 months of 2009
• Loans for new MF construction are very difficult to obtain in today’s capital markets
• Orlando’s rental stock decreased by an average of 2.7% annually during the past five years due to condo conversions
• Although about 8,000 rental units intended for condo conversion came back into the local rental pool, Orlando’s overall apartment supply is down 10,000 units since 2004
• Demand for new rentals remains strong, but new construction continues to slow due to the challenging lending environment, high impact fees, and a lack of infill sites with school capacity
• 3,351 new rental units were completed during 2008
• Multifamily permits in the 3rd quarter time frame registered at just 663 units, down
63% from the 3rd quarter of 2007
• Impact fees are approximately $7,500 - $11,500 per unit in Central FL counties
(Post Lake at Baldwin Park apartments, middle left photo)
ORLANDO SALES STATISTICS FOR 2008
• About 7,398 apartment units in Orlando sold in 2008 for a value of approximately $599 million, down about 43% from one year ago
• Nationally, multi-housing sales were down nearly 60% from 2007
• Orlando was the most active apartment sales market in Florida
• The sales decrease is primarily due to a continued disconnect in the bid/ask spread
• Cap rates did increase approximately 100 bps over the last half of the year due to
continued turmoil in the capital markets and the lagging national economy
• Underwriting has become much more conservative with regards to capital structure,
cash flow, and exit assumptions.
• The 3rd Qtr of 2008 was the most active in terms of local apartment sales, seeing
$267 million in multi-family transactions from July - Sept
• The most active buyers continued to be private equity groups
• Most buyers are receiving financing from Fannie Mae and Freddie Mac.
• Approximately seven REO and failed condo conversions were sold during 2008
CONTACTS:
Shelton Granade, First Vice President, Investment Properties-Multihousing. PH 407 839 3103. FX 407 404 5001.
shelton.granade@cbre.com 
Luke Wickham, (bottom left photo), Director of Operations, PH 407 839 3103. FX 407 404 5001.
luke.wickham@cbre.com.
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