Pandemic stunts growth of Ivanhoe Village district
Many apartments sit empty but businesses grateful for residents
The sign for The Yard, a luxury apartment complex in Orlando’s Ivanhoe Village, shines high above The Lucky Lure, the open-air bar across the Sunrail tracks. Bartender Jerrod Fox is grateful for the new residents it has drawn to the neighborhood.
“They completely support us,” Fox said, pointing out that the COVID-19 pandemic has made it hard to keep the lights on at the bar this year. “More than a few days, those are the only people who come in here.”
When The Yard and The Lake House complex near it opened last year, the artsy neighborhood just north of downtown prepared for as many as 2,000 new residents who would fill the more than 800 total apartments. But that hasn’t happened as the pandemic and a glut of high-end apartments have stunted the growth of the village.
Other businesses are thankful for the residents they have seen. Rodney Croskey, co-owner of Orange Ave Gym, said he’s had new members come from The Yard even though the building has its own gym.
“It may be a small number, but it’s definitely a benefit,” Croskey said. “Especially during these times.”
But others are still waiting for things to pick up.
“Everyone’s talking like there’s going to be this huge wave of people,” said Jackson Roach, a manager at Ski World Orlando near The Lucky Lure. “I just haven’t seen the wave yet.”
A key issue beyond the pandemic is supply. The Orlando metro area has seen 30,000 apartments built in the past five years. In downtown’s race to usher in new developments, many apartments are sitting empty.
“Orlando had been experiencing rising vacancies for about two years going into the pandemic,” said Brian Alford, Florida director of market analytics for CoStar, a real estate analysis firm. “We had the highest vacancies in about eight years” in the first quarter of 2020.
“It is tough to imagine any relief coming anytime soon with another 2,500 units under construction [in downtown Orlando],” Alford added.
At The Lake House, which opened in August, property manager Broc Hollen said the company has done what it can to attract new residents during the pandemic, offering virtual tours and free masks to visitors. Yet the building sits at about 10% occupancy.
“There’s just a ton of competition,” Hollen said.
Rents at The Lake House’s 254 units range from about $1,600 a month for a studio to $4,500 for a multi-bedroom. The Yard is only a little less expensive, starting at about $1,400.
The rents are in line with The Gallery at Mills Park just down Virginia Avenue and fit in the range of many of the downtown developments. Alford refers to this price range as Class A or high-end units. He said when you look at apartment availability in the lower price ranges, “vacancies are still pretty tight.”
Even during the pandemic, his company has tracked stronger rent growth among less expensive apartments.
“Virtually all” of the new buildings are Class A, Alford said. “Simply speaking, the only way for developers to really make it a profitable deal is to build in that upper end. Anything lower than that is very difficult to make money on.”
Still, Alford said demand for these new units remains high, despite Orlando’s notoriously low-wage hospitality labor force. He said diversified job growth has made Orlando one of the top cities for new jobs in the last five years.
And developers aren’t slowing down.
Even during the pandemic, Orlando broke ground on at least 1,000 new apartments each quarter. “We had seen decreasing starts, but nowhere near most other markets in the country,” Alford said. “Developers are still pretty optimistic.”
Whenever that happens, the Ivanhoe apartments are banking on the charm of the eclectic neighborhood to lure in new inhabitants.
Ginger Bricker moved into The Yard when it opened in March.
“I’ve known about this place since it was a sketch on a piece of paper,” she said. A 10-year resident of Celebration who works in real estate, she estimates only about half of the about 300 units are currently occupied.
Management at The Yard did not return requests for comment.
And The Yard has more to go. In addition to a 13,000-square-foot food hall, The Yard will also open another building of apartments this year, bringing its total number of units to 591.
“It’s the neighborhood that sold me,” said Alicia Modeen, 32, a seven-year Orlando resident who moved into The Yard in January.
The Lake House also has a restaurant in the works set to open this year and is playing into the artsy feel of Ivanhoe with local art on its walls and a mural of historic sights from the area.
“Ivanhoe Village is something like a secret
area,” Hollen said. “We’re situated on a recreational lake right across from the core of the city.”
The key, Alford said, is time.
“We really need development to slow down a little bit and let Orlando’s strong and consistent demand catch back up,” he said.