With Its Growing Residential Population, Denton County Is The Silent Storm In CRE
With a population expected to breach the 1 million mark by 2025, real estate experts view Denton County as a silent hero in Dallas-Fort Worth commercial real estate development.
From corporate relocations in the form of Charles Schwab's headquarters move to Westlake to the Professional Golfers' Association's decision to choose prairie land in Denton County as the landing pad for a future headquarters, Denton County is firing on all cylinders. The 2,500-acre Fields development, which includes the future PGA headquarters and is located in both Denton and Collin counties, is projected to spawn up to $18M in commercial/office and mixed-use development and as many as 30,000 jobs, according to data from the city of Frisco.
The momentum from this project alone has put Denton County on the map with corporations on the West Coast and East Coast now seeing Denton as a prime golf, white-collar and retail destination for future corporate development.
"We are busier than ever," Denton County Director of Economic Development Michael Talley said. "We are going to continue going after headquarters and higher-wage jobs."
At the same time, blue-collar work centers around the city of Justin and industrial developments throughout AllianceTexas are creating a robust and economically diverse community. Meanwhile, explosive population growth is putting the entire area on the development map. Under the real estate trend of commercial development following household creation, Denton County is showing signs of impressive current and future growth.
"Denton County is forecasted to [create] 50,000 housing units over the next five years. That is about 14% growth," Transwestern Research Manager Andrew Matheny said. "When you put that into perspective, Denton County is going to continue to grow on the trajectory that it was on before 2020, and I think specifically retail is going to be one of the biggest drivers of the recovery [in Denton] as continued population growth opens up new trade areas."
The Denton County population shot up 39% in the past 10 years from 662,614 residents in 2010 to 925,612 this year, according to ESRI Business Analyst data prepared for and released by Weitzman. Twenty years ago, the county had just over 400,000 residents.
That, plus abundant land, is driving projects like the PGA, the Grandscape mixed-use development in The Colony and the Charles Schwab headquarters to the county. But the county is flying under the radar.
"People will go, 'I didn't realize all of that was in Denton County.' People don't realize how much land we cover and what cities we cover," Talley said.
The county's role in attracting these assets is often credited to the suburban cities that played a big part in recruiting them, he added.
Talley's role after being hired by the county is to make sure Denton's reputation as a landing pad for future retail, office and entertainment development is communicated well beyond the boundaries of North Texas.
While the county is most often associated with the city of Denton and the University of North Texas campus, the area also houses some of the Metroplex's fastest-growing suburbs from The Colony to Westlake, Lewisville, Aubrey, Little Elm and parts of Frisco and Trophy Club.
As these communities grow with residential development surging, CRE analysts expect more explosive growth in Denton County across all aspects of commercial real estate development, but retail in particular.
"It will continue to grow in terms of its appeal, and in terms of its recognition in the marketplace as a viable market for commercial, residential and retail development because when a company is doing their analysis of their market, they are looking at the barometers of population growth and household income," Weitzman Vice President Lynn Van Amburgh said.
Those drivers in Denton County show consumer power remains strong and continues to grow. Data provided by Weitzman shows Denton County with a median income level of roughly $89K per year, and entertainment and recreational spending in the county is expected to grow from $1.38B this year to $1.75B by 2025.
Economic data also is promising for retailers and restaurants that are assessing the area for development and redevelopment opportunities over the course of the next five years.
Food consumption away from home at restaurants and other food and beverage venues is projected to reach $1.67B in Denton County in 2020 and increase to $2.1B in spending by 2025, according to data from Weitzman and ESRI. The same study shows apparel and service retail is projected to grow from $960M this year to $1.19B by 2025.
Retail has had a rough year nationally, and occupancy metroplex-wide fell 1% by mid-2020.
Yet, retail brokerage Weitzman noted Denton County's strength midyear with the Grandscape development in The Colony remaining one of the few retail venues experiencing a construction expansion this year. The redeveloped Golden Triangle Mall in Denton also continued to sign new leases with major retail tenants in the midst of a pandemic.
Located off Interstate 35, the mall inked a 55K SF lease with the Fitness Connection health chain and another 41K SF lease with Conn's Home Plus, a store that moved into an old big-box space once occupied by Sears, according to Weitzman.
What will continue to set Denton County apart is its availability of land, which offers relocating companies the ability to tap into prime industrial or corporate office use space.
"They are extremely well-positioned because of the amount of available land that is still there in Denton County for residential development," Matheny said. "And that has been a driver of decisions to relocate that far north when you have land to build residential housing to attract any type of worker."