The Memphis multifamily market has recently captured attention from prospective buyers with some impressive statistics. With 2020 rent growth at 6.6 percent and year-to-date 2021 at 10.5 percent year-over-year, the metropolitan showed resiliency through a turbulent period as peer Sun Belt cities experienced stagnancy and even decreases in rents. This trend has put the metropolitan area on acquisition radars and garnered sales to new-to-market buyers looking to plant a flag in the market. But it raises questions concerning the longevity and sustainability of the rent growth. By taking a further look at the market’s fundamentals, economic drivers and rent trends across market segments, we can shed some light on this over-arching question. Logistics and healthcare Memphis’ stable 2020 and 2021 multifamily performance is grounded by an economy rooted in logistics and medical services. Within the Memphis metropolitan area, 42 percent of the workforce is in the transportation/logistics or education and health service industries, compared to a national aggregate of 20 percent. The growing reliance of these industries insulated the Memphis economy from the worst of repercussions stemming from the pandemic-induced recession. While quarterly wages decreased an average of 6.5 percent in peer markets in the second quarter of last year, …
