Sarasota, FL Multifamily Market Report
Market Overview
The Sarasota multifamily market is experiencing a challenging pricing environment, with an average cap rate of 6.3%. Properties are selling for an average of $213,636 per unit, and the typical sale price is $18.9 million. On average, sales prices are 12.6% below the initial asking prices, with properties taking approximately 9.7 months to sell, highlighting resistance from buyers on pricing.
In terms of leasing, the market has seen a slight downturn, with asking rents decreasing by 1.6%. The average vacancy rate is 10.4%, signaling a moderately competitive leasing environment. A total of 4,285 units have been delivered to the market, contributing to a sales volume of $566 million.
Sarasota By The Numbers
- Vacancy Rate: 10.4%
- Asking Rent Growth: -1.6%
- Delivered Units: 4,285
- Sales Volume: $566M | Last 12 Months | Source: CoStar Group
Market Sales Averages
- Cap Rate: 6.3%
- Sale vs Asking Price: -12.6%
- Sale Price Per Unit: $213,636
- Average Units: 116
- Average Sale Price: $18.9M
- Months to Sale: 9.7 | Last 12 Months | Source: CoStar Group
Development Pipeline
Sarasota’s development pipeline remains active, with 72,176 units in total inventory. 5,887 units are currently under construction, while 4,281 units have been delivered recently. Absorption rates have been slower, with only 2,835 units absorbed, leading to an occupancy rate of 89.56%.
- Inventory Units: 72,176
- Units Under Construction: 5,887
- Absorbed Units: 2,835
- Occupancy: 89.56% | Last 12 Months | Source: CoStar Group
Sarasota Activity By Unit Size
5-50 Units
Sales in this size range remain steady, with a cap rate of 6.4% and an average sale price per unit of $253,187. The average sale price for these properties is $3.7 million, with total sales volume at $66.3 million. Sales are generally 9.4% below asking, and properties take around 10.1 months to sell.
- Vacancy Rate: 5.0%
- Rent Growth: 0.7%
- Market Asking Rent Per Unit: $1,308
- On Market Cap Rate: 6.9% | Last 12 Months | Source: CoStar Group
50-200 Units
Larger properties (50-200 Units) show a sales cap rate of 7.5%, with a lower sale price per unit at $142,287. The average sale price is $19.5 million, contributing to a total annual sales volume of $117 million. These properties take about 10.1 months to sell.
The Sarasota multifamily market is reflecting a steady supply pipeline with mixed vacancy rates across asset types. While smaller properties (5-50 units) show a lower vacancy rate and slightly better rent growth, medium-sized properties (50-200 units) have higher vacancies but offer competitive cap rates. Sales are occurring at discounts to asking prices, particularly in the smaller asset classes, and it takes around 9-10 months to close transactions across the board. Developers continue to be active, yet absorption remains a focus to improve overall occupancy levels.
- Vacancy Rate: 11.6%
- Rent Growth: 0.4%
- Market Asking Rent Per Unit: $1,910
- On Market Cap Rate: 5.4% | Last 12 Months | Source: CoStar Group
One key deal drove most of the sales in Q1 2024: West Shore, a Boston company, bought the Cirrus at Aqua for $93 million, paying a premium of $264,000 per unit.
