St. Petersburg Apartment Loans
|St. Petersburg Apartment Loan Rates Over $6,000,000||Rates (start as low as)||LTV|
|Apartment 5 Year Fixed Loan Rates||5.12%||Up to 80%||Get Free Quote|
|Apartment 7 Year Fixed Loan Rates||5.10%||Up to 80%||Get Free Quote|
|Apartment 10 Year Fixed Loan Rates||5.09%||Up to 80%||Get Free Quote|
|St. Petersburg Apartment Loan Rates Under $6,000,000||Rates (start as low as)||LTV|
|Apartment 5 Year Fixed Loan Rates||5.31%||Up to 80%||Get Free Quote|
|Apartment 7 Year Fixed Loan Rates||5.21%||Up to 80%||Get Free Quote|
|Apartment 10 Year Fixed Loan Rates||5.09%||Up to 80%||Get Free Quote|
Frequently Asked Questions
Is multi-family real estate a good investment in 2023?
Inflation fears, high interest rates, and the prospect of recession have slowed the pace of the commercial real estate market considerably. Some property types are outperforming others. Apartment buildings in desirable neighborhoods are performing well, as owners have been able to raise rents and keep up with rising interest rates. Multifamily properties in smaller and less desirable areas, or areas where unemployment is rising, are not performing as well, as rent increases are harder to implement. In the office sector, only medical office buildings are generating lender interest. General office properties have underperformed the market as a result of the work from home policies established during the Covid-19 pandemic. Office demand is unlikely to return to pre-Covid levels making the office sector extremely hard to navigate right now. In the retail sector, essential service businesses, such as grocery stores and pharmacies, are performing well, while traditional brick and mortar retailers are still feeling the effects of Covid-19 and the competition from online retailers. Many malls are experiencing record high vacancy levels, and some are being repositioned for other purposes. In the industrial sector, we are seeing strong demand for warehouse and distribution space to accommodate the online retailers. Industrial space in urban markets and close to transportation are performing very well. We expect to see sales prices for underperforming properties to drop in 2023 as investors gravitate to better positioned properties.
There are many different types of lenders offering a myriad of different loan products to finance the acquisition or refinance of apartment properties nationwide. These lenders include agency lenders (Fannie Mae and Freddie Mac), local and national banks, insurance companies, credit unions and private lenders.
Most lenders write apartment loans for five, seven or ten years (fixed) with a 30 year amortization. It is also possible to obtain loans that are fixed for up to 30 years, although this is not the norm. Rates are typically based on a margin over the corresponding US Treasury rate.
Lenders offer non-recourse to strong borrowers and solid properties. The borrower will be expected to have strong credit, good net worth and liquidity, and experience owning and managing similar properties. The property will be expected to demonstrate solid long term positive cash flow, be in good to excellent condition, and be located in a strong market with low vacancy rates.
Apartment loans are typically screened and pre-approved in 2-3 days. Since lenders require appraisals, environmental and property condition reports, and title, closings will usually take 45-60 days from application.
How do we help our clients needing financing for a multifamily apartment building get the best rate and terms?
Select Commercial has excellent apartment loan products and options available for owners and purchasers in need of multifamily properties throughout the city of St. Petersburg. Whether you need an apartment lender to finance a small apartment property, a complex with hundreds of units, or a co-operative, we can help you find the optimal apartment loan solution to meet your apartment loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. St. Petersburg is one of the cities that we consider to be a premium market and we actively look to originate good quality apartment loans here for our clients. We have a diverse array of many available loan products to help qualified borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve Apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service. If you are looking to purchase or refinance an apartment building, don't hesitate to contact us. For more information on multifamily loans, check out how to get the best rate on a multifamily loan and how to get the best rates on an apartment refinance.
Apartment - Multifamily Loan Benefits
Apartment Loan rates start as low as 5.09% (as of May 29th, 2023)
• A commercial mortgage broker with over 30 years of lending experience
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on multifamily financing
• Terms and amortizations up to 30 years
• Multifamily loans for purchase and refinance, including cash-out
• 24 hour written pre-approvals with no cost and no obligation
Recent TRUSTPILOT Reviews
Select Commercial Funding Reviews from TRUSTPILOT
A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"
Apartment Loan Types We Serve
If you are looking to purchase or refinance a apartment building, don't hesitate to contact us. We arrange financing in the city of St. Petersburg for the following:
- Large urban high-rise multifamily buildings
- Suburban garden multifamilycomplexes
- Small multifamily buildings containing 5+ units
- Underlying cooperative multifamily building loans
- Portfolios of small multifamily properties and/or single-family rental properties
- Other multi-family and mixed-use properties
Apartment Loan Helpful ArticlesHow to Get the Best Rate on a Multifamily Loan
Fannie Mae and Freddie Mac 2022 Update
How To Get The Best Rates On An Apartment Refinance
What Do Underwriters Look for When Evaluating Apartment Loans?
What You Need to Know About Freddie Mac SBL Multifamily Loans
How to Calculate Debt Service Coverage Ratio for Apartment Loans
Apartment Occupancy Levels – Concern in Some Major US Markets
How to Invest in an Apartment Building
Are You Shopping for an Apartment Building Loan?
How to Buy an Apartment Building
What Are Commercial Mortgage Lenders Looking for These Days
How to Qualify for a Great Rate When Refinancing Your Apartment Building
Recent Multifamily Loan Closings
What are the market conditions expected for Apartment Loans in 2023?
Experts anticipate above average performance for the multifamily sector in 2023. Occupancy rates are expected to remain above 95% and rental rates are expected to grow by 4%. These figures are not as robust as the past couple of years, however, which saw vacancy rates under 3% and rent growth in the double digits. During the second and third quarters of 2022, leasing activity for apartment buildings was slow. This coincided with a solid pace of new multifamily deliveries to the market. The combination of slower leasing activity and heightened supply caused the overall vacancy rate to increase by 150 basis points in the middle portion of 2022. Throughout 2023, vacancy rates will likely continue to rise at a slower pace and move toward the 20-year average of 5%.
The overall multifamily housing demand is expected to remain strong in 2023. With inflation continuing to impact consumer spending, more and more renters are determining whether to renew their leases. While new leasing activity stalled throughout the middle portion of 2022, the overall multifamily demand remained pretty strong. The rise in home prices and residential mortgage rates is also helping to increase multifamily demand. Monthly payments for homes purchased in the third quarter of 2022 were, on average, 57% more than monthly apartment rents. That difference is the widest gap on record. Even if home values and mortgage rates decrease in 2023, the relatively lower cost of renting will support multifamily demand.
Rapidly rising interest rates on multifamily loans caused multifamily investment activity to slow down in the second half of 2022. Many buyers not willing to pay higher rates for apartment loans stepped out of the market. As apartment loan rates stabilize in 2023, many buyers will return to the market and look to finance apartment building investments with multifamily loans. The multifamily sector has historically been one of the most attractive sectors to investors. Over the past decade, the multifamily sector has seen average annual total returns of 9.3%. Additionally, this sector offers multifamily loan options from both Fannie Mae and Freddie Mac. These apartment loan options are not available for other asset classes. As the market stabilizes in 2023, more and more investors will look to acquire apartment buildings and finance them with agency apartment loans.
One other factor that caused the multifamily sector to stall in 2022 is that buyers expected cap rates to increase commensurate with the rise in interest rates, but sellers still expected higher prices. This caused many deals to simply not cash flow. Cap rates are expected to increase in 2023. With this increase, many buyers will have the option to finance acquisitions with apartment loans at more attractive prices.
St. Petersburg Apartment Loan Outlook - 2022
Strong Apartment Demand Keeps Record Low Vacancy in St. Petersburg – Investment Activity is Solid
Strong employment opportunities bring new residents to the market. Florida’s relaxed Covid-19 regulations during the health crisis caused the economy in St. Petersburg to rebound faster than most other large U.S. cities. Employment in the local market is growing quickly, creating high levels of migration to the market, creating record setting demand for apartment unit rentals. Renters leased more than 13,500 new apartment units in 2021, lowering apartment vacancy to 2% and raising apartment rents by more than 20% during the largest period of new apartment delivery since 2000. Local market fundamentals are the strongest in a long time and there is expectation that these conditions will continue in 2022. St. Petersburg’s business friendly tax structure and highly skilled employee base cause many companies to relocate to the area. Signode Industrial Group and ConnectWise are relocating their offices to St. Petersburg in 2022, adding more job opportunities to the market. The market’s strong rate of demographic growth, coupled with moderating numbers of new apartments slated for completion in 2022, will keep market apartment vacancy rates at record setting lows. In addition, tight availability in the local market will continue to cause apartment rental increases, making St. Petersburg one of the top performing apartment markets in the country.
Lower sales prices drive investor competition. Apartment pricing in St. Petersburg is lower as compared to other large Florida markets and strong apartment rent increases are fueling investment sales in the market. Competition among buyers for apartment properties is driving sale prices up and lowering cap rates to the mid-5% range. Despite the drop in cap rates, initial investment returns in St. Petersburg are approximately 50 basis points above the national average, drawing interest from investors looking for higher returns to the St. Petersburg market. These investors are focused on Southeast St. Petersburg and Pasco County, where investment returns are often higher than the market average. Sales activity with institutional investors and private equity is on the rise due to the rising rental rates in the market. Institutional investors target apartment properties in North St. Petersburg and Pinellas County, where high end apartments often sell near $180,000 per unit.
2022 Apartment Market Forecast and Chicago Apartment Loan EconomicsSt. Petersburg has a National Multifamily Index ranking of 8. New residents moving to the market and steadily rising rents give St. Petersburg a top 10 ranking in the 2022 survey.
Employment is up 4.5%. Employers will create 64,000 new jobs in 2022, after a 4.8% rise in total employment in 2021.
New construction adds 5,800 apartment units. Construction levels slow down in 2022 after the completion of 8,000 apartment units in 2021. New deliveries will increase the city’s rental stock by 2.2%.
Vacancy rates remain unchanged. Vacancy rates will remain at 2% as net absorption matches additions in 2022. In 2021, a drop of 220 basis points occurred, dropping vacancy rates to a record low.
Apartment rents are up 5.5%. Tight vacancy rates increase the average effective rent to $1,635 per month, representing the 13th year in a row of annual rent increases in the market.
Investment in St. Petersburg apartments. Historically strong apartment performance attracts interest from national investors and continues to create demand for available apartment properties.
St. Petersburg apartment loan rates will start to increase in 2022 as the Federal Reserve starts raising rates to slow the rate of inflation. We will be watching to see if the St. Petersburg apartment loan rate increases will affect market activity in 2022.
All data provided by Marcus and Millichap
St. Petersburg Apartment Loan Outlook 2021
National Apartment Loan Outlook
The COVID-19 pandemic affected the ability of young St. Petersburg graduates to find jobs and move into apartments of their own. The demand for St. Petersburg apartment rentals is usually fueled by young graduates entering the workforce and moving into rental apartments. Many young adults lived with their parents or friends during the pandemic and into early 2021. As 2021 progressed, many companies reopened their offices and began hiring again which generated record levels of new apartment rentals. This trend should continue through late 2021 as more new St. Petersburg workers are able find jobs and move into their own apartments. Many of these new multifamily units are in metro areas of the sunbelt states as workers have been moving out of colder urban areas in favor of more suburban warmer climates.
The tight market in 2021 for new home purchases has caused many would be homebuyers to continue renting. Prices for existing homes have risen due to lack of inventory and the cost of construction has skyrocketed due to increased costs for raw materials. The high cost of purchasing a new or existing home is keeping the demand for rental units very strong in 2021.
During the pandemic, when St. Petersburg workers were either out of work or working from home, many people moved out of densely populated urban areas in favor of suburban locations. In 2021, as more employees are returning to their offices, we are seeing demand pick up once again for rental apartments in urban locations. In addition, as more and more retail and dining locations reopen in downtown areas, we expect to see a return of employees to these areas.
During the pandemic, the CDC and local governments instituted a moratorium of evictions. This caused many St. Petersburg landlords to suffer economic losses and depressed the value of apartment properties. In 2021, as these moratoriums start to expire, we expect to see strong demand from investors for these properties.
Nationwide, the first half of 2021 saw more than 175,000 new apartments completed and a total of 363,000 for the previous 12 months. A high percentage of these new units were in Texas and other sunbelt states, as more and more people are relocating to warmer climates. Occupancy rates and asking rents have been lower in larger urban markets in the Northeast and other colder climates, while occupancy rates and asking rents have been increasing in these warmer sunbelt climates. These 2021 trends have definitely been driven by the COVID-19 pandemic and we are watching these trends closely to see if these trends persist after the pandemic is over. Check out our low commercial real estate loan rates and use our commercial mortgage calculator to calculate monthly principal and interest.
St. Petersburg Apartment Loans
Select Commercial provides Apartment Loans and multifamily loans throughout St. Petersburg and the state of Florida.