If the cranes and occasional congressional snide weren’t indication enough, a new report out today finds that the District is going through a construction boom—and that 45 percent of residential units under development are in Capitol Riverfront, NoMa/Union Market, and Southwest.
The Washington D.C. Economic Development Partnership has released its annual development report, which covers the entire city and which real-estate firm CBRE also helped compile. More than 14,800 residential units were being constructed or significantly renovated as of August, representing an 11 percent spike as compared with the same time last year and the third year in a row that a record has been set, according to the report. There were almost 100 residential projects underway, totaling over 13 million square feet. Of these, 90 percent were rental units.
“The growth in young professionals has been the primary driver behind the strong demand for apartments in D.C.,” the report states, noting that the number of residents aged 25 to 44 jumped more than 30 percent from 2006 to 2015. “Millennials living in D.C. are increasingly renting apartments rather than owning homes due to shifts in lifestyle preferences, as well as the impact of the recent [national] recession and debt.”
WDCEDP’s data comes from a census of dozens of developers, architects, contractors, and other organizations. The vacancy rate for market-rate rental apartments in August was 5.3 percent, on par with last year’s. Meanwhile, the number of building permits issued from 2010 to 2015 rose 42 percent over those filed from 2000 to 2009.
But it appears that apartment units themselves are shrinking. The report says the size of a one-bedroom unit has declined, on average, from 850 square feet in the early 2000s to between 725 and 750 square feet as of now. “Renters in D.C. are increasingly more focused on proximity to public transportation and other location-based amenities,” the authors go on to explain.
And the most expensive neighborhood to rent an apartment in, according to the report? Foggy Bottom, which had the highest effective rental rate ($2,672 a month) of a typical apartment at the end of August, followed by downtown/Logan Circle ($2,612), and Woodley Park/Cleveland Park/Van Ness ($2,276). Of the neighborhoods and groups surveyed, east-of-the-river Anacostia had the lowest effective rental rate ($1,621).
You can access the full report here.