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Dallas-Fort Worth Once Again Among ULI's Top CRE Markets To Watch

Dallas-Fort Worth is one of the most promising real estate markets in the nation, according to results of an annual survey conducted by Urban Land Institute.

The Metroplex is a top U.S. market to watch, scoring third place for its overall real estate prospects and fifth for its homebuilding prospects, according to ULI’s Emerging Trends in Real Estate Report, published in partnership with PricewaterhouseCoopers

Phoenix bumped DFW out of its No. 2 spot for real estate prospects, and Nashville topped the list for the second year in a row.

Downtown Dallas

DFW continues to benefit from growth across the Sun Belt, where the real estate outlook remains positive despite economic headwinds. Respondents to ULI’s survey pointed to the region’s relatively low cost of living, better quality of life and business-friendly environment as the reasons behind its outsized prospects.

“Population growth in these markets is fueling considerable development and employment growth — and vice versa,” ULI analysts wrote in their report. “Every [Sun Belt] market is growing faster than the national average, adding over a million new residents since 2019 — all requiring new housing, services and workplaces.”

The Dallas area has consistently outperformed the nation even as a steep drop-off in property lending stifles the bulk of activity. 

For the third year in a row, Dallas led the nation in CRE investment, with $13.2B deployed over the first nine months of this year, per recent data from MSCI Real Assets. That’s a 64% decline over the same period last year, but still more than the $12.7B spent in the runner-up metro of Los Angeles.

Despite capital markets challenges, the majority of respondents to ULI’s survey remain cautiously optimistic about where the market is headed. To hedge risk, they are being much more selective about where they choose to invest, and high-growth metro areas like DFW continue to be the safest bet.

“I still default long-term strategically to the long-term growth in the Sun Belt markets,” a head of research for an asset management firm told ULI.