Oh lord.
Here comes Apple, and the rising rent forecast from hell.
One can almost hear the eviction papers rustling and the moving trucks rolling.
Last spring, state and local leaders heralded the tech giant’s arrival next year at the Research Triangle Park and the thousands of high-paying jobs it will provide on its vast campus.
But, a story that appeared this week on GlobeSt.com, a real estate content website, noted an uncomfortable reality. The new Apple campuses at RTP and Austin, Texas “are expected to create higher occupancy and rental rates at existing properties and more demand for development projects under construction that will soon cut the ribbon.”
The soaring prices that are now a feature in the Triangle housing market? They will only worsen—as the story explains, in RTP and Austin, Apple campuses “are lifting markets for rental properties and residential real estate investment trusts” throughout the two regions.
Skyrocketing real estate prices is a national phenomenon, but that’s little solace for Triangle residents who are enduring an affordable housing crisis that’s exacerbated by the arrival of more affluent newcomers who are buying less expensive homes in traditionally Black neighborhoods in or near the downtown districts as a consequence of the region’s limited housing inventory.
The news that Apple’s investment projects “are accelerating the growth” of giant real estate firms in the area that are purchasing and building apartment complexes should be even more troubling for longtime Triangle residents who are struggling to pay their rising rental costs.
As the INDY reported, the 281 acres of land that Apple controls in RTP near Cary and Morrisville will be the company’s largest presence on the East coast. Average wages for a workforce of 5,000 with jobs in machine learning, artificial intelligence, software engineering, and more will come in at around $187,000.
The arrival of uppermost-shelf paying jobs at places like Apple and Google Cloud—which announced last year that it will bring 1,000 additional six-figure paying jobs to downtown Durham—means that places like RTP, with its “growing cluster of research facilities,” has played a role in Harbor Group International’s recent $475-million acquisition of Dasmen Residential LLC workforce housing portfolio, which includes more than 2,000 housing units in nearby Raleigh-Durham, GlobeSt.com reports.
In addition to increasing HGI’s North Carolina portfolio up to about 5,000 apartments, HGI president Richard Litton told GlobeSt.com that the RTP is an important target in his company’s desire to “acquire well-located communities in high-growth markets.”
“As the area’s high-paying STEM jobs continue to attract new residents, we see [an] opportunity to leverage our expertise in owning and [operating] similar communities in the region to generate rent growth and increasing demand for housing,” Litton said.
One can only imagine what will define “affordable housing” in the Triangle, particularly in Durham, where housing authority officials last month announced plans to build 1,700 residential units, with nearly 900 will be priced for residents earning between 30-80 percent of the area median income.
GlobeSt.com reports that real estate investment trusts like the Harbor Group International aren’t the only real estate companies intent on expanding their housing footprints in the Triangle and Austin.
Camden Property Trust, which operates 171 properties in the U.S., and Mid-America Apartment Communities, are also buying up properties.
The Triangle Business Journal in March of last year reported that Camden’s first project in Durham called for the construction of more than 350 apartments in downtown Durham accompanied by 6,000 square feet of commercial space.
Meanwhile, according to Camden’s website, a one-bedroom apartment in downtown Raleigh rents for $1,650.
Mid-America has properties in 12 communities throughout Raleigh and Cary, with more than 400 apartments. Relatively speaking, the units are competitively priced. A studio unit rental starts $1,150 and a one-bedroom starts at $1,230, according to its website.
GlobeSt.com also reports that Apple has started to expand its campus in Culver City, California, where the tech giant’s presence could be a harbinger of what’s to come here in the Triangle.
The West Coast blog LAist.com reported in 2019 that with median-priced homes selling for nearly $1 million, 47 percent of Culver City households are renters, with more than 22 percent of Culver City residents “putting more than half of their paycheck toward rent.”
The exponential increase in housing, the blog reports, has been particularly hard on “the elderly, younger families, and the city’s black middle class.”
Aww hell.
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Follow Durham Staff Writer Thomasi McDonald on Twitter or send an email to tmcdonald@indyweek.com.
