Downtown, Ninth Street attracting apartment builders

Jun. 01, 2014 @ 07:44 PM

Although at least four other apartment complexes are under construction now in north Durham, a development official behind the new Crescent Ninth Street complex has high expectations for the project.

The complex is targeted to open in June, more than two years after the project’s initial groundbreaking. Ben Collins, vice president of the multifamily group for the Charlotte-based project developer Crescent Communities, said the construction timeline was affected by “tremendous shortage” in apartment construction labor.
Delays aside, Collins was very upbeat about the prospects for the complex, which will offer studio apartments through three-bedroom units. Rates start around $1,000, according to a spokeswoman for the company. In addition to general heightened demand for apartments, Collins said the Ninth Street area is underserved in Class-A apartments. 
Company officials believe it’s one of two areas in the Triangle where residents have access to a true “live-work-play” environment, he said, with shops, restaurants, bars, two grocery stores and workplaces all nearby.
“We would say this Ninth Street submarket in Durham is perhaps one of the most underserved submarkets in the Southeast,” Collins said. “Obviously Duke University and Duke (Medicine) are big drivers for that market, but we’ve seen really resident (interest) from all over the Triangle,” he added.
Crescent Communities is also developing another new complex, called Crescent at Main on 15th Street near Ninth Street. According to the market research firm Karnes, the projects are two of five new apartment communities that were under way in March in north Durham, including one student-oriented complex.
There are also another four new projects proposed, but not yet under construction, for north Durham, according to Karnes. And a new North Durham project has already been completed called the Heights at LaSalle.
The pipeline includes projects targeted for the city’s downtown, where Brian Reece, a Raleigh-based managing director for Karnes, said there isn’t a lot of new apartment construction. Complex owners may be able to get higher rates there than in other areas.
“The central business districts … typically will have a higher rent than the suburban areas,” he said.
Reece said the apartment market in downtown Raleigh is “exploding,” attracting people who want to be near night life and walkable amenities. He said he’s starting to see that in downtown Durham and around Ninth Street.
“I think in downtown Durham, possibly we’ll start seeing more graduate students at Duke, we’re going to see maybe the younger medical (workers) going to the hospital,” he said, adding that he also expects the city’s walkable amenities to be an attraction.
“There’s a lot of interest in apartments because of flexibility … getting a mortgage is still very difficult, compared to seven years ago,” he said.
Kevin Dick, director of Durham’s Office of Economic and Workforce Development, said he expects units downtown to fill up quickly.
Dick said that’s because of an increase in the number of people working downtown, upward population projections, as well as a desire of retirees to downsize and to live in more walkable environments.