This year, real estate developers will complete a record 450 apartments in downtown Aurora and are expecting to finalize another 350 in 2018. On the other hand, this could have a negative effect on the landlords in Aurora, who are currently enjoying one of the best rental markets in Illinois, according to Adam Hochfelder, a Managing Director of Real Estate Acquisitions & Development at Merchants Hospitality. So far, in the first quarter, the market has held up amid strong demand for apartments.
For the Class A buildings, the average net effective rent rose to $2.9 per square foot in the first quarter, which is 1 percent higher compared to the same period in 2016, according to Hochfelder. This is below the 3 to 5 percent increase of apartments rent from the previous years, while the average Class A effective rent has risen 45 percent, since 2009. All this suggests that the market has started to decelerate, but has not shifted in reverse, yet. We expect to see the market unravel in the upcoming period, when around 200 from the 450 planned new apartments, will open in July and August. This could initiate a competitive scramble for tenants, said Hochfelder.