South Bay economy preps for reset
Despite a grim showing nationwide, the South Bay’s economic profile is somewhat set up to weather the storm better than others, reported Yardi Matrix. Its tech-centric economy and strong infrastructure allows companies to pivot to a work-from-home environment, while its lower-density population — especially when compared with nearby San Francisco or Los Angeles — will allow it to go through the state’s four phases of reopening more efficiently.
Rents in the metro were even up 0.1 percent on a trailing three-month basis as of April, while the U.S. rate plateaued. The metro had been gearing up for record rental inventory growth this year, but delays due to pandemic-related restrictions will likely curb that rise.
Multifamily transactions were at a standstill in San Jose in 2020, following the cycle high of $1.4 billion in multifamily assets that closed last year. Elevated per-unit averages and limited inventory mean that deals require large amounts of capital, le