Denver-based Aimco, which owns 134 apartment communities, said same-property NOI increased by 6.2 percent in the fourth quarter. Average rent per apartment home was $1,671, up from $1,604 in the fourth quarter of 2015. Revenue per apartment home grew by 8 percent year on year to $1,978 in the fourth quarter.
But the firm is fastening its seatbelt for a bumpier ride in 2017, executives said on the firm’s earnings call. The REIT expects same-property NOI growth to flatten in many major markets during the year due to slowing employment growth and a glut of new properties. It also expects to have to provide tenants with more concessions in order to reach desired occupancy levels.
Aimco plans to reinvest its capital in existing properties this year rather building new ones, but it will monitor market conditions closely and will not hesitate to cancel renovations in markets where conditions appear to be rapidly declining, said CEO Terry Considine.
“Redevelopment is safer than new development because you can stop,” he said. “If the market at any particular time and any particular location is not meeting our expectations we can tweak it, improve our product or even just default to the base case of the occupied unit before redevelopment.”