South Bay Apartments Are Riding the Aerospace Boom: 583 New Units This Year, 2,700 More Coming

The South Bay's aerospace and defense boom is starting to show up in the apartment market. Billions in federal and private capital flowing into aerospace and defense tech firms is drawing multifamily developers and owners into a submarket that has long been steady, quiet and undersupplied — and the South Bay is now outperforming the rest of Los Angeles on rent growth, Cityview reports in a Sept. 22 piece by Bianca Barragán.

The pipeline numbers tell the story. Developers have delivered 583 new units in the South Bay since January — roughly 50% more than at this time last year — with another 2,700 units under construction and set to arrive over the next three years. Average rent in the submarket is $2,345 per month, according to Northmarq data cited in the piece.

The headline project is Apollo, a 265-unit development in Gardena from Los Angeles-based Cityview and Stockbridge Capital that opened earlier this year. Listed apartments show studios starting around $2,800 a month, one-bedrooms from $3,225, and two-bedrooms from $4,165. The property sits a block from SpaceX's Hawthorne manufacturing facility — a former Northrop Grumman site — and is drawing renters from the cluster of defense and aerospace employers nearby, including some that moved to the area after the project broke ground.

"With the job engine being aerospace and the aerospace corridor, we really thought that a lot of the jobs that were investing into that area would spill over into the natural need for housing, and so far, we really have experienced that," said Shane Robinson, president of Westhome Property Management, the property manager for Cityview's buildings.

For South Bay owners and investors, the takeaway cuts two ways. The jobs engine supports demand for rentals — Torrance rents already rose 1.6% over the past year while most of LA County slipped — which underwrites prices for well-located small multifamily. But the 2,700 units under construction are real future competition: this is the first supply wave of its size the South Bay rental market has seen in years, and landlords who have not had to compete on concessions may have to start.

Source: Cityview — https://www.cityview.com/south-bay-multifamily-gaining-steam-from-rebooted-aerospace-defense-sector/

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