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danwxman

Harrisburg apartment occupancy rates: UP!

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"I never thought I'd see people jumping that river. I've seen it strongly in the last two years. [it used to be] I never got a call from a Mechanicsburg person saying they were coming to the city." Ann Miller, Grayco Apartments manager

Sunday, March 06, 2005

BY ELLEN LYON

Of The Patriot-News

Home buyers aren't the only ones showing new interest in the city. Harrisburg apartment complexes report rebounding occupancy rates.

Record low mortgage rates the last several years drove many renters into homeownership, forcing many apartment complexes to offer a free month of rent and other incentives to attract occupants. Interest rates remain at historically low levels, and some of the incentives to rent remain.

But city landlords are seeing a relatively new phenomenon -- an uptick of young suburbanites and people from other areas who want to live near the downtown where they work and party.

Occupancy rates began to drop in 2002 and 2003, "a direct result of the mortgage interest rates," said Pat Egenrieder, executive director of the Apartment Association of Central Pennsylvania. "We started seeing a comeback last year."

"People can have a mortgage for what they pay in rent," said John McDermott, senior general manager of Pennsylvania Place at 301 Chestnut St. in Harrisburg. "We're slowly seeing a small increase in traffic."

Pennsylvania Place peaked at 96 percent occupancy in mid-2003, he said. Then rentals began to decline. In February 2004, a few hundred residents were forced to leave their apartments for a few days because of an electrical fire and explosion on the fourth floor of the 25-floor high-rise.

"We were in a decline. ... That definitely didn't help," McDermott noted.

Pennsylvania Place, which has an outdoor pool, did $2 million in renovations, including redoing the fitness and business centers and opening a "state-of-the-art" laundry facility, McDermott said.

The occupancy rate is now "climbing toward 90 percent," he said.

Residents include physicians and other employees from nearby Harrisburg Hospital, state legislators, corporate tenants and people who work downtown, McDermott noted.

"We have a good mixture of everyone here," from young professionals to senior citizens, he said.

At Grayco Apartments at 115 North St., across from the YMCA, "we did lose a few people to home purchases," manager Ann Miller said.

But the Grayco's good location and reasonable rents have insulated it from steep declines, Miller said. The apartment house's occupancy rate is a "steady 98 percent," although it was in the low 80s when JRGray LP bought it as a "distressed building" five years ago, she said.

Since then, the owners have installed a new roof, windows and elevator, Miller said.

The rental market consists of college graduates working their first full-time jobs, baby boomers with empty nests and no desire to keep up a big yard and house, and single people and childless couples who don't want the responsibility of a home, Egenrieder said.

Some families with lower incomes or poor credit also are continuing to rent because they don't have a choice, she said.

Miller has noticed younger people from the suburbs wanting to rent in the city.

"I never thought I'd see people jumping that river," Miller said. "I've seen it strongly in the last two years. [it used to be] I never got a call from a Mechanicsburg person saying they were coming to the city."

They are drawn to the night life, and they feel safe in the city, she said.

There's also the advantage of not having to worry about drinking and driving if you live near restaurants, bars and clubs, Miller said.

Other high-rise apartment complexes in the city report similar healthy occupancy rates.

Town House Suites Hotel & Apartments at 660 Boas St. has an occupancy rate of 92 percent, leasing consultant Randi Tarasi said.

"That's a good occupancy rate," she said. "We're not struggling at all."

Apartment residents include all ages, many of whom work for nearby state agencies, Tarasi said.

Korman Communities at 2311 N. Front St., formerly River Plaza and River House, has a "pretty stable" apartment occupancy rate of 95 percent, according to corporate sales director Cindi Wycheck.

It just dropped to 89 percent this month, but Wycheck said she is confident that "probably by April we should be back up again."

In 2003 it hit a low of 83 percent, she said.

Now her clientele "seems like it's getting younger," in their 20s and early 30s, Wycheck observed.

Executive House Apartments at 101 S. 2nd St. has an occupancy rate of 98 percent, manager Ann Marie Ramsey said.

Competitive rents that include utilities for studio and one-bedroom apartments have helped to keep Executive House's occupancy rate at or near 100 percent for years, she said.

Many of her residents are young people just out of school who work downtown and want to live there, too, Ramsey said.

"I'm asking them to pay $700 or $800 a year to park their car, and they're still doing it," she said. "You'll never pay for parking in the suburbs. It's the price to live in the city."

ELLEN LYON: 255-8153 or [email protected]

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^^ I'm thinking it was Penn National Insurance Tower completed in the late 90's . . . im 99% sure but let me know if i'm wrong, don't know Harrisburg well enough to get a bearing on that narrow shot.

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^^ I'm thinking it was Penn National Insurance Tower completed in the late 90's . . . im 99% sure but let me know if i'm wrong, don't know Harrisburg well enough to get a bearing on that narrow shot.

<{POST_SNAPBACK}>

It's actually the Market Square Plaza, an 18-story office tower, which is almost finished. The exterior is basically done, they are still working on the interior.

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