AvalonBay resumed with a Neutral at Goldman Sachs

Goldman Sachs resumed coverage of AvalonBay with a Neutral rating and $191 price target. The analyst resumed coverage of seven multifamily real estate investment trusts, saying internal growth dynamics, external growth opportunities, and execution will drive growth. Supply headwinds against demand strength is perhaps the most prominent theme for multifamily in 2024 and 2025, the analyst tells investors in a research note In the Sunbelt markets, the firm expects supply pressure to peak in Q2 and then moderate from there on to reach a normalized level in the first half of 2025. On the demand front, Goldman continues to be constructive on Sunbelt markets, primarily driven by robust job growth, positive migration trends, and favorable affordability and demographics. Looking at the West Coast, the firm is less sanguine on demand recovery in the near term, especially Northern California, given limited incremental tailwinds and choppy tech employment.