The demand for living in downtown Baltimore remains so strong that the city’s urban core can continue to absorb thousands of new units, according to a new study released Wednesday by the Downtown Partnership of Baltimore.
The analysis conducted for the partnership by the consulting firm Zimmerman/Volk Associates found that downtown can support at least 6,700 new rental and for-sale units over the next five years.
The number may sound surprising to anyone who has been watching as old office buildings are converted into new apartments and residential towers join Baltimore’s skyline, bringing thousands of new units to a city with a slow-growing population.
But the report, a five-year analysis of market rate housing demand in the downtown area and surrounding neighborhoods by the New Jersey-based real estate consulting firm, rebuts concerns often raised that a construction boom in Baltimore is over-saturating the downtown area’s housing market.
“Over and over we have proved the naysayers wrong,” said Kirby Fowler, president of the Downtown Partnership, a nonprofit charged with promoting the area.
By the end of this year, the downtown core and surrounding neighborhoods will have gained 5,200 rental and for-sale units since 2012. That’s fewer than the 5,570 to 6,135 units an earlier study by the Downtown Partnership projected the market could absorb.
Even with all the new units, the downtown area’s occupancy rate stands at 94 percent.
The report’s Downtown Study Area encompasses a broader area than typically is considered Downtown Baltimore — neighborhoods within a mile radius of the city’s center, from Station North, south to Locust Point.
Still, analysts and developers caution that current experience is not necessarily an indicator of future demand.
“It’s everyone’s question right now, as to whether all the additional supply is going to get filled by the demand,” said Tony Casaleno, managing director of SVN RealSite, a Baltimore real estate brokerage. “Only time will tell.”
Right now, Casaleno said, his firm is optimistic. As one building after another opens up, they continue to fill, he said.
The developer of 10 Light, Metropolitan Partnership, said the converted art deco office tower with 455 residences is about 96 percent leased.
The Bozzuto Group’s 292-unit Anthem House in Locust Point has been leasing at least 20 apartments a month since…