Over 100 multifamily investors, listing brokers, and property managers gathered on March 15th to hear from Greg Willett and Cameron McIntosh about the national multifamily market and more specifically about the DFW apartment market. MPF gathers their data from actual lease transactions across over 10,000,000 apartment units as they own products like Yieldstar Revenue Management.
Below are my key takeaways from the event:
- New Supply: Texas is the epicenter for new supply in apartments. Texas has 10% of the apartment inventory in the US, but currently has 20% of the new construction. More apartments are being built in DFW than anywhere in the US. However, the demand story is strong as well. Since 2010, DFW has created 541K new jobs across all industries, which is more growth than any other city in the nation. MPF is predicting DFW multifamily occupancy to be down 50bps to 95% and rent growth to be 4% in 2016.
- Class B: MPF is predicting the best rent growth and occupancy for Class B product in the DFW metroplex. Along with the new job growth, there has been wage growth over the last couple of years in the Class B tenant base, which is allowing tenants to absorb rental increases in this product. There is still a significant gap between Class B rents and Class A rents. A majority of the new supply is coming in the “urban core” in submarkets like Uptown, which will constrain rent growth and occupancies in Class A product.
- Real Estate is a People Business: In addition to hearing from MPF, we had listing brokers and property managers share their insights into what is currently going on in the market. Julian Alexander started his message with “I’m not in the Real Estate business, I’m in the Relationship business”. Owners prefer working with listing brokers they trust, listing brokers like selling to owners with equity, debt, and property management already lined up. It’s a small world in DFW multifamily market, and people do transactions with those they trust and have a relationship with.
The next Old Capital Speaker will be in June and the presenter will be one of the leaders of CBRE’s Dallas appraisal group. If you want the presentation slides from this event or want more information on future events, contact me at 214-300-5035 or firstname.lastname@example.org