Construction Times Have Grown Even Faster Than Rents

In the latter half of last decade, the average multifamily construction duration was trending up, due in no small part to the ever-increasing activity and output of the new construction pipeline. The onset of the COVID-19 pandemic changed this dynamic. Construction times continued to rise, but due to different influences.

So far this year, the situation has changed yet again. 2022 is on pace for fewer units to begin lease-up during the year than in recent years. However, construction times have continued to climb. One feature that does not appear poised to change is the downward trend in the average lease-up duration.

Average Construction Duration

For new properties that began leasing in the first half of 2022, the average time between a construction start and a lease start was around 19 months at the national level. For some context, for new properties that began to lease in 2019 the average was about 14 months. 2022 is only halfway over but should the year close with the average remaining around 19 months, this year’s average duration increase would be the largest of the last five years. The increase at the average from 2020 to 2021 was 10%. This year, so far, the increase from 2021 was 13% as of the end of June.

At the national level not only has the average multifamily construction duration continued to increase, but if the current 2022 average were to hold for the full year, it would make the fourth consecutive year in which the average grew faster than in the previous year.

Regional differences persist as well. Using NAA regions for simplicity, the longest average construction duration for any region so far this year was Region 10 at 24 months – California and Hawaii. This was not a particularly surprising result, but even so, Region 10 was the only region to have an average construction time of two years.

Other regions stood out in terms of percent change from last year. Region 7, roughly the Pacific Northwest and Mountain West, has led the way so far this year with a 33% increase in the average construction time from last year. Regions 1 and Regions 4 on the East Coast each have also seen their average rise by about 25% so far this year. Only Region 6, Texas and New Mexico, has seen essentially no increase this year.

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Average Lease-up Duration

At ALN, lease-up duration is measured as the number of months from a lease start to stabilization. Stabilization will be 12 months after a construction completion, or when 85% occupancy is reached – whichever comes first.

As construction times grow at an increasing rate, the average lease-up time nationally has fallen since 2020. For properties to complete lease-up this year, the average duration was slightly over 12 months after a recent peak of 14 months in 2020. In a typical period, there is not much year-to-year movement in this average. 2020 was an exception due to a one-month increase in the average lease-up time that year. This year is another exception so far, thanks to a decline of almost six weeks compared to the average from properties that stabilized in 2021.

The longest average lease-up time at the market level among markets with at least 10 properties to reach stabilization this year were Kansas City and Washington DC at approximately 16 months each. The California Bay Area and Chicago were right behind with each averaging about 14 months so far this year.

On the other end of the spectrum, Greenville – Spartanburg, Miami, Seattle, and Tampa have had the shortest average lease-up time among markets with at least 10 properties to stabilize so far in 2022 – all right around 10 months.


It is likely not a surprise to see that multifamily construction times are continuing to grow, but the scale of the growth so far this year brings the extent of the challenge into focus. As already mentioned, the 2022 averages are based only on half the year, but the sample size is now large enough to be useful as a preview.

The movement on the lease-up side is a positive indication of apartment demand at the top of the market for expensive new properties, but the apartment demand picture changes considerably when evaluating non-lease-up properties.

There does not seem to be much reason to expect substantial improvement in construction times in the back half of the year, meaning that 2022 is shaping up to be a year on the lower end of the range for recent annual deliveries.

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