Are the apartments filling up?
Yes. There is considerable demand for the new apartments that have been built. They are averaging about a 95% occupancy rate. An occupancy rate this high means these apartments are effectively full, since there is always some turnover due to people moving in and out. This is also why apartments leave their “for rent” signs up all the time. This is not because they have high vacancy rates, but because of turnover. Apartment managers do not want to take down and put up signs on a weekly basis.
Why have so many been approved?
The demand for rental units in Orem has increased consistently over the last several years. This is due to several factors—the most important of which has been an overall shortage in housing supply. The number of new single family homes built in Orem over the last several years has decreased significantly (especially at more affordable prices). This is related to rising construction costs and the limited availability of undeveloped land in the City. In addition to this, for many years no new apartments were being built. After the recession, developers began to take more interest in multifamily projects. But these did not get approved without input from City leaders and City residents. Almost all large apartment projects in Orem involve a change in zoning and must go through a formal process to gain approval. This involves neighborhood meetings, public notices, public hearings, Planning Commission meetings, and ultimately the projects are debated, considered, and voted upon by the City Council.
To learn more about the housing shortage that is affecting most of Utah see: KSL Article
Is the City doing anything proactive to protect against too many being built?
Yes. The State Street Corridor Master Plan calls for new apartments to be contained in five “districts” along State Street. Creating these districts will concentrate new growth and achieve two major objectives. Redevelopment will occur along State Street where future transit can serve new residents and mitigate traffic concerns. Restricting apartments to these districts will also preserve the primarily single family nature of Orem’s existing neighborhoods. Until the plans for each of these districts has been finalized, the City Council has decided not to approve plans for any new apartments within 500 feet of State Street, 800 North, Center Street, and University Parkway.
Are they being subsidized?
They have not been subsidized. These apartments are built 100% by the developers without any assistance from the City.
Will any additional apartments be built?
Utah County is expected to experience considerable growth over the next few decades. According to official projections from the Governor’s Office, the County’s population is expected to increase from a 2016 estimate of just under 600,000 to 1.4 million by 2060. While much of this growth is expected to occur in the less developed areas of the County, Orem is still expected to increase in population. Since only about 200 acres of undeveloped single family zoned land remains in Orem, the demand for housing from future growth must also come from the redevelopment of existing properties. Because redevelopment is expensive, these projects usually require higher densities. But this doesn’t mean only apartments; there will also be townhomes, condos, and other types of housing. The City wants to encourage new residential development that will allow for home ownership.
Is Orem the only city seeing this kind of demand for multifamily housing?
No. Cities surrounding Orem are seeing this type of development. Provo, Sandy, Pleasant Grove, American Fork, and cities throughout Salt Lake County are all seeing demand for multifamily housing increase. For example, the Denver metro area saw an increase of about 11,000 apartments last year with another 13,000 planned for this year. Like Utah, these units are nearly all full.