DFW Multifamily Builds Turned Controversial In 2019, But They're Still Winning In Absorption
Multifamily construction had a love-hate relationship with Dallas-Fort Worth residents in 2019, with some North Dallas citizens protesting against it, while developers and analysts cited the need for much more of it.
When you analyze this battle on a numbers-by-numbers basis, developers and analysts supporting new apartment supply win the war, according to a new study from CoStar.
DFW built 136,800 apartment units, or 6% of the entire U.S. apartment construction pipeline, between 2010 and 2019, CoStar said.
Comparatively, Los Angeles and New York built 51,554 and 127,124, respectively, during the decade.
This high volume of DFW construction activity kept pace even as warnings of market oversaturation in multifamily sought to stymie some of the new builds, according to CoStar.
But the multifamily deals kept coming, mainly because residents kept absorbing new DFW supply — the area ate up 143,000 apartments during the past decade, roughly 6,600 more units than were built during the same period, CoStar said.
While a rising populist sentiment against multifamily surfaced in the North Dallas suburbs in 2019, the CRE community remained steadfast in its belief that the numbers alone showed a shortage of workforce housing, justifying the need for more apartment construction.
The National Apartment Association and the National Multifamily Housing Council commissioned a study from the Hoyt Advisory this year that concluded multifamily demand is robust enough in DFW to justify the creation of 19,000 apartments every year just to keep up with anticipated demand.
Millennials took urban living to the suburbs this decade, prompting the creation of more apartment-centric, mixed-use developments in those areas over the course of the past 10 years.
"As a result, the suburbs of Dallas are thriving," Hendershot wrote in his multifamily report. "The suburban markets of north Dallas took four of the top five submarkets for new construction, adding a total of 47,475 apartment units, or 34% of the total development [this decade]. Frisco led the way with 14,050 new units, followed by the Farmers Branch-Addison-Carrollton submarket."
Perhaps not surprising given the sudden flow of deliveries, the North Dallas suburbs are where apartments in 2019 faced some of their greatest public pushback.