By Travis D’Amato, Managing Director, JLL Capital Markets
There’s a new trend developing in the Greater Boston multifamily investment sales market, and it’s the migration towards what we like to call outer urban. Renters and investors alike are flocking to metro north towns like Everett, Medford, Chelsea and Revere, which present excellent access to the urban core at a discount to downtown pricing.
From the resident’s perspective, properties like The Batch Yard in Everett, One North in Chelsea, or Station Landing in Medford, provide just what they need – access and affordability. While just a few T stops from Boston, rental rates in these units are nearly half the price of that in Boston, allowing for dramatic cost savings. On the investor side, there is significant projected rent growth in these properties, pushing returns higher in IRR calculations.
The Residences at River’s Edge in Medford is the latest multifamily property in the outer urban area to hit the market. The riverfront property sits along the MBTA orange line with quick and easy access to Station Landing, Assembly Square and Downtown Boston.
Be it The Residences at River’s Edge, The Batch Yard, or One North, the outer urban developer is building a luxury product that portrays an aura of coolness that many downtown Boston buildings lack at a more affordable price. This seems to be appealing to Millennials in particular, who are snatching up these properties at unheard of absorption rates. In fact, the lease-up velocity at some of these outer urban complexes is near 70-80 units per month. The opportunity is there, now it is time to capitalize on this demand.