St. Louis 2Q23
Multifamily Market Report

$1,251

average rent

94.9%

average occupancy rate

$328.5M

ytd sales volume

4.6%

YoY rent change

-1.0 POINT

yoy occupancy change

18 YTD

individual transactions

Supply & Demand

2Q23

527 Units

QUARTERLY DEMAND
YTD: 423

369 Units

QUARTERLY COMPLETIONS
YTD: 831

Annual Demand vs Completions

2018
4,080
2,536
2019
4,121
1,997
2020
1,412
2,004
2021
4,241
1,268
2022
-1,074
2,748
2023 YTD
423
831
  • Planned
    Completions
  • Pre-Planned
    Demand

Demand Trends

  • After two consecutive quarters of negative absorption, St. Louis property owners and operators have a reason to be optimistic. Apartment demand has taken a positive turn with a total of 527 units absorbed in the second quarter.

 

  • Six out of 10 submarkets demonstrated positive absorption. Notably, the St. Charles County submarket accounted for 36% of the absorbed units this quarter.

Completion Trends

  • During Q2 2023, the inventory of apartments in St. Louis expanded by 369 units. This growth was exclusively contributed by two submarkets: St. Charles County and St. Louis City.

 

  • Over the past four quarters, the St. Charles County submarket has significantly contributed to the metro's inventory by incorporating 1,130 units, roughly 1.5 times more than the Central West End/Forest Park submarket, which added 736 units during the same period.

Demand Outlook

  • In the next four quarters, the St. Louis MO-IL apartment market is anticipated to experience an uptick in demand. RealPage’s forecast suggests about 2,550 units will be absorbed in this timeframe, surpassing the five-year annual average of 2,112 units.

 

  • RealPage’s forecast suggest that the St. Louis City and St. Charles County submarkets will emerge as significant demand hotspots.

New Supply Outlook

  • In St. Louis, there are currently 5,123 units under construction, which account for 2.2% of the existing inventory. Although this is slightly above the historical average of 1.4%, the proportion of units under construction remains entirely manageable. 

 

  • Of the units currently under construction, 3,780 are slated for completion in the next four quarters. The majority of these units are situated in the St. Louis City, Mid St. Louis County, and St. Charles County submarkets.

Demand Trends

  • After two consecutive quarters of negative absorption, St. Louis property owners and operators have a reason to be optimistic. Apartment demand has taken a positive turn with a total of 527 units absorbed in the second quarter.

 

  • Six out of 10 submarkets demonstrated positive absorption. Notably, the St. Charles County submarket accounted for 36% of the absorbed units this quarter.

Completion Trends

  • During Q2 2023, the inventory of apartments in St. Louis expanded by 369 units. This growth was exclusively contributed by two submarkets: St. Charles County and St. Louis City

 

  • Over the past four quarters, the St. Charles County submarket has significantly contributed to the metro's inventory by incorporating 1,130 units, roughly 1.5 times more than the Central West End/Forest Park submarket, which added 736 units during the same period.

Demand Outlook

  • In the next four quarters, the St. Louis MO-IL apartment market is anticipated to experience an uptick in demand. RealPage’s forecast suggests about 2,550 units will be absorbed in this timeframe, surpassing the five-year annual average of 2,112 units.

 

  • RealPage’s forecast suggest that the St. Louis City and St. Charles County submarkets will emerge as significant demand hotspots.

New Supply Outlook

  • In St. Louis, there are currently 5,123 units under construction, which account for 2.2% of the existing inventory. Although this is slightly above the historical average of 1.4%, the proportion of units under construction remains entirely manageable. 

 

  • Of the units currently under construction, 3,780 are slated for completion in the next four quarters. The majority of these units are situated in the St. Louis City, Mid St. Louis County, and St. Charles County submarkets.

Occupancy & Rent Trends

RENT VS OWN
MONTHLY PAYMENT

$1,466

Average Monthly Mortgage Payment

$1,251

Average Monthly Rent

Occupancy trends

The St. Louis multifamily market demonstrated robust stability in its fundamentals, sustaining a healthy occupancy rate despite an uptick in supply. Over the 12 months ending in June 2023, occupancy saw a modest decrease of 100 basis points, resulting in a still-strong rate of 94.9%. Although supply outpaced demand, five of St. Louis’s ten submarkets showed improvements in their occupancy rates over the quarter. The Mid-St. Louis County submarket reported the largest quarterly increase, with its occupancy rising 80 basis points to 94.7%. Notably, the Chesterfield/Ballwin/Wildwood submarket held the highest occupancy rate at 96.6%.

RENTAL TRENDS

In Q2 2023, the St. Louis apartment market observed a year-over-year increase of 4.6% in average rents for new leases, rising to $1,251 per month. Despite a moderation in rent growth – a trend mirrored across most other U.S. markets – this increase significantly outperformed the market’s historical average growth rate of 3.3%. Notably, St. Louis ranked 10th in rent growth among the top 50 U.S. apartment markets during this quarter. Delving into submarket performance, the St. Clair/Madison Counties, South St. Louis County/Jefferson County, and Northeast St. Louis County submarkets experienced the most considerable annual rent increases, ranging between 7.4% and 7.6%. The most expensive submarket was Mid St. Louis County, where average rents exceeded $1,600 for the first time.

Submarket Rent & Occupancy

SubmarketAverage OccupancyAnnual Occupancy ChangeAverage Monthly RentAnnual Rent Change
Central West End/Forest Park93.8%-2.1%$1,5963.2%
Chesterfield/Ballwin/Wildwood96.6%-1.6%$1,4083.7%
Florissant/Hazelwood93.8%-1.5%$9842.0%
Maryland Heights/Creve Coeur95.0%-2.6%$1,2857.2%
Mid St. Louis County94.7%-0.7%$1,6072.6%
Northeast St. Louis County91.4%-0.9%$8137.6%
South St. Louis County/Jefferson County97.0%-0.9%$1,0557.4%
St. Charles County95.7%-1.7%$1,3482.9%
St. Clair/Madison Counties97.1%-0.6%$1,2587.4%
St. Louis City92.3%2.2%$1,2034.3%
St. Louis, MO-IL94.9%-1.0%$1,2514.6%

Units by Submarket Delivering in 2023

5,123

Units Under Construction

3,780

Units UC Delivering In the Next 4 Quarters

Percentage of Units Under Construction

Central West End / Forest Park - 541
0%
Chesterfield / Ballwin / Wildwood - 767
0%
Florissant / Hazelwood - 0
0%
Maryland Heights / Creve Coeur - 524
0%
Mid St. Louis County - 822
0%
Northeast St. Louis County - 0
0%
South St. Louis County / Jefferson County - 0
0%
St. Charles County - 867
0%
St. Clair / Madison Counties - 278
0%
St. Louis City - 1,324
0%

Percentage of Units Delivering Next 4Q

Central West End / Forest Park - 270
0%
Chesterfield / Ballwin / Wildwood - 675
0%
Florissant / Hzewldood - 0
0%
Maryland Heights / Creve Coeur - 134
0%
Mid St. Louis County - 742
0%
Northeast St. Louis County - 0
0%
South St. Louis County / Jefferson County - 0
0%
St. Charles County - 626
0%
St. Clair / Madison Counties - 278
0%
St. Louis City - 1,055
0%

Sales Activity

In Q2 2023, individual multifamily asset trades in St. Louis totaled $328.5 million. This figure represents a 49% decrease compared to the $647.9 million in transactions during the same period in 2022. However, it’s important to view this within a broader historical context. Despite the decrease in sales activity compared to 2022, the trade volume for the first half of this year surpasses that of the first half in six of the last ten years.

TRANSACTION VOLUME


YTD Transaction Volume


Y-O-Y Change

  • 18

Individual Transaction Count


Price Per Unit


Annual Price Change

* Trailing 4Q average PPU

* Preliminary Data from RCA – Individual transaction $2.5M +

Economy

According to preliminary data from the Bureau of Labor Statistics, the unemployment rate in St. Louis was 3.0% in May, below the U.S. average of 3.5%. Over the course of the previous year, employment in the metro expanded by 1.4%, equating to an increase of 18,500 positions. The leisure and hospitality sector witnessed the most significant growth, adding 10,800 new jobs, a rise of 7.5%. This was closely followed by the education and health services sector, which added 5,300 new roles.

16.2k

May Annual Jobs Created

1.4%

May 23 Employment growth

3.0%

May 23 Unemployment rate
3.4% us may rate

Top 5 Employment Sector Annual Change

<br>Leisure & Hospitality

Change from May 2022
to May 2023: 10,800

Percent Change: 7.5%

<br>Education & Health Services

Change from May 2022
to May 2023: 5,300

Percent Change: 2.0%

<br>Manufacturing

Change from May 2022
to May 2023: 2,700

Percent Change: 2.3%

<br>Government

Change from May 2022
to May 2023: 2,500

Percent Change: 1.6%

<br>Professional & Business Services

Change from May 2022
to May 2023: 2,300

Percent Change: 1.0%

Hover over circles to view data
SectorChange from May 2022 to May 2023 Percent Change
Leisure and hospitality10,8007.5%
Education and health services5,3002.0%
Manufacturing2,7002.3%
Government2,5001.6%
Professional and business services2,3001.0%
Other services1,5002.8%
Trade, transportation, and utilities4000.2%
Information-400-1.4%
Financial activities-1,500-1.5%
Mining, logging, and construction-5,100-6.8%

Economy

According to preliminary data from the Bureau of Labor Statistics, the unemployment rate in St. Louis was 3.0% in May, below the U.S. average of 3.5%. Over the course of the previous year, employment in the metro expanded by 1.4%, equating to an increase of 18,500 positions. The leisure and hospitality sector witnessed the most significant growth, adding 10,800 new jobs, a rise of 7.5%. This was closely followed by the education and health services sector, which added 5,300 new roles.

16.2k

May Annual Jobs Created

1.4%

May 23 Employment growth

3.0%

May 23 Unemployment rate
3.4% us may rate

Top 5 Employment Sector Annual Change

leisure & hospitality services

leisure & hospitality services

Change from May 2022 to May 2023:
10,800

Percent Change:
7.5%

education & health services

education & health services

Change from May 2022 to May 2023:
5,300

Percent Change:
2.0%

manufacturing

manufacturing

Change from May 2022 to May 2023:
2,700

Percent Change:
2.3%

government

government

Change from May 2022 to May 2023:
2,500

Percent Change:
1.6%

professional & business services

professional & business services

Change from May 2022 to May 2023:
2,300

Percent Change:
1.0%

Hover over icons to view data
Tap icons to view data
SectorChange from May 2022 to May 2023 Percent Change
Leisure and hospitality10,8007.5%
Education and health services5,3002.0%
Manufacturing2,7002.3%
Government2,5001.6%
Professional and business services2,3001.0%
Other services1,5002.8%
Trade, transportation, and utilities4000.2%
Information-400-1.4%
Financial activities-1,500-1.5%
Mining, logging, and construction-5,100-6.8%

Major Economic Developments

view of Earth and satellite

New $1.7B NGA Campus Attracting High-Tech Companies to the Metro

$1.7B Investment in New HQ

St. Louis Place Location

2025 Completion of Campus

712k SF Office Space

black chevrolet car on road during daytime

General Motors' $1.5B Upgrade at Wentzville Plant

4,000 High-paying jobs retained

$1.5B Investment in new Canyon and Colorado pick-up truck production

Wentzville Plant location

2023 Production begins

woman standing indoors

$1B Capital Investment by VA System

250 Healthcare workers

700k SF Hospital Facility

2024 Construction Start

$1B Capital Investment

Market Outlook

Amidst an uptick of new units, the St. Louis apartment market seems to be faring well. With nearly every submarket expected to see positive demand over the next year, there’s little cause for concern. Leading the charge are the St. Louis City and St. Charles County submarkets, with a combined projected absorption rate of 1,511 units, accounting for nearly 60% of all units. While market dynamics may fluctuate, the impact on rent growth and occupancy is likely to be minimal. Looking beyond the second quarter, strong market fundamentals and consistent demand point to a stable long-term outlook for St. Louis, even amid uncertain market conditions.

Sources: RealPage; BLS; MSCI; St. Louis Business Journal; St. Louis Regional Chamber.

To Gain Further Insights Into The St. Louis Market Please Reach Out To Our local Team

Image of Dan

Daniel Wiele

Senior Director

Image of Tom

Tom Maloney

Senior Director

Alex Beck

Associate Advisor

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