Developer expects apartment project to increase vacancy rates
By Martin Kidston/Missoula Current
A local developer believes his 330-unit apartment project off Mullan Road will help soften the vacancy rate across Missoula when the first units open this May.
Nate Tollefson of Tollefson Properties broke ground on the project last year. The total development consists of 13 buildings on 10 acres of ground behind the Carmike 12 theater.
The first 114 units will be move-in ready this spring, while another 116 units will be available this fall, he said.
“We’ve done hundreds of other units around Missoula over the last eight or nine years,” he said. “I think the vacancy rate is starting to creep up and will continue to creep up. But as far as housing goes, this will definitely shift the tide.”
The 2016 housing report released by the Missoula Organization of Realtors found that vacancy rates across the city increased from 3.9 percent in 2014 to just 4.1 percent last year, despite the number of new units to come online in recent years.
The report described Missoula’s 4.1 percent vacancy rate as very low – well below the 7.1 percent national average. The city’s slight increase in vacancy rates had no effect on reducing the price of rent, which increased in nearly every category in 2015.
“I believe this will definitely make the vacancy go up,” Tollefson said. “Getting 330 units in town is no small feat for Missoula in a short amount of time. It should help.”
Tollefson described the new apartments as moderately priced. The energy efficient units, ranging from one to two bedrooms, will include air conditioning, and they’ll be within walking distance of a number of amenities located in the North Reserve Street area.
He said the location makes the project unique.
“We have two main arterial roads with Mullan and Reserve, plus the business centers around here are a key component,” he said. “The Hellgate elementary and middle school is a great district. I built 75 units behind Home Depot a few years ago, so we try to stay in certain areas.”
Tollefson said his company has future projects in mind, though he declined to name the location, citing competition in the industry.
Contact reporter Martin Kidston at [email protected]