Where are America’s small apartment properties (5 to 49 units)?  Which markets are growing the fastest? The data presented here is the first-ever assessment of the geographic distribution of the small asset apartment inventory.

How Concentrated is the Small Asset (5 – 49 unit) Market?

• The small asset inventory is concentrated in the country’s largest metro areas.

• The Top 20 metro areas accounted for slightly over half of the small asset inventory in 2014.

• Geographic concentration was even higher for large asset units, where the Top 20 metro areas accounted for as much as 65 percent of the large asset inventory.

Where are the Largest Markets for Small Apartment Buildings

• As shown below, the Top 5 metros (New York, Los Angeles, Dallas, Chicago and Houston) accounted for slightly more than a quarter of all small asset units.

• The next five metros (Washington DC, Miami, Atlanta, San Francisco and Boston) together comprised another 11 percent share of the total.

• In comparison, the rankings of the Top 5 metros for large asset units deviate slightly with Washington DC replacing Dallas. Together those five metros constitute a whopping 36 percent share of the overall large asset inventory.

• The New York metro alone comprises about one-fifth of the overall US large asset stock.

(Based on the share of overall apartment inventory. Source: Chandan Economics, 2014 American Community Survey.)

Which are the Fastest Growing Big Markets?

• The largest metros are not necessarily the fastest growing ones in either the small asset or the large asset market in the post-crisis period.

• As shown below, the fastest growing small asset markets are a mix of both Gateway and Secondary markets.

• For example, Houston, which is a large market, also has the highest overall average annual growth rate (AAGR) for small asset multifamily of about 7 percent, three times faster compared to only 2.1 percent for the New York metro area.

• Smaller metros with comparatively high post-crisis small asset growth rates include Portland, Minneapolis, Tampa, Phoenix and Denver.

• Similarly, the list of fastest growing markets for large asset units is a mix of large metros (Houston, Dallas, Miami and Washington DC) and medium size metros (Seattle, Denver, San Diego and Minneapolis).

(Source: Chandan Economics, 2014 American Community Survey.)