Denton County's Growth Has Developers Moving In Across Sectors

The growth of Denton County has made the area a hot spot for development across asset classes. 

U.S. Census Bureau data show the county’s population has grown by nearly 20% since 2020, prompting large master-planned communities to spring up and manufacturers ranging from pharmaceutical companies to large-scale magnet manufacturers to move in. Denton Economic Development Director Brittany Sotelo said the growth has also helped local businesses expand. 

"We've seen an upward trend in building permits issued over the past five years, and it continues to rise," Sotelo said during Bisnow's Denton County State of the Market on May 27 at the Embassy Suites by Hilton Denton Convention Center. "We're getting attention from regional stakeholders, and we're also getting attention from international businesses." 

Ross Perot Jr.'s Hillwood has two billion-dollar master-planned communities under construction in the county: the 3,200-acre Landmark project in Denton and the 617-acre Lantern development near Pilot Point. Those two projects will add 8,000 single-family homes and at least 3,000 multifamily units to the county.

As Denton County's residential base diversifies, Realty Capital Management Managing Director Jimmy Archie said the area is reaching the point where it can support the entire employee population of major companies. 

That residential growth is key to successful projects, as Archie said he was taught to follow good school districts when planning new developments. With strong schools, residential growth and reasonably priced housing, the other asset classes will fall into place. 

"The retail follows the office … and development just stems from there," Archie said.

Grocery goliath H-E-B, one of Texas’ biggest retailers, has followed the growth, with two stores planned for Denton. One will be part of the Landmark project, while work on the other at the corner of University Drive and Bonnie Brae Street began earlier this year. 

In addition to the new master-planned communities, residential growth has been happening for quite a while in Denton County, and Archie said nearly every other product type is beginning to catch up with that growth. 

“I'm seeing a lot of the different municipalities that have high barriers to entry be more open to bringing on quality commercial development to help the tax base,” Archie said.

MP Materials Corp. is developing a large-scale magnet manufacturing campus on a 120-acre site in Northlake. The company plans to invest $1.25B to build the campus that will boost its annual production capacity to around 10,000 metric tons of neodymium-iron-boron magnets, used in defense applications, data centers and semiconductor manufacturing.

Swiss pharmaceutical company Novartis confirmed in February it plans to build a 46K SF radioligand therapy manufacturing site in Denton for cancer treatments. Work on the facility is expected to start later this year and be completed in 2028.

All of that development has pushed Denton County to the top of JPI’s rankings for future multifamily and build-to-rent projects, JPI Managing Director Adrienne Bain said. 

To help finance Denton County projects, developers are often turning to the state's commercial property assessed clean energy program, according to Lone Star Pace Chief Operating Officer Glenn Silva. C-PACE helps property owners fund energy-efficiency, renewable energy and water conservation upgrades using private dollars. 

Silva said Lone Star Pace has completed eight projects in Denton County since the firm was established there in 2020.

“The proof is in the pudding,” he said. "There's a lot of activity and a lot more to come."

Among that activity is the growth of the office market in Denton County. Dallas-Fort Worth's office market has been fueled by demand for trophy office space, which is fetching record-high rents.

The population growth in Denton County has created a need for more office space. Silva said he believes the county has an “excellent opportunity” for office development.

“We're social animals — we need a sense of community, we need to have that ability to work together,” he said.

However, Silva said the typical suburban building with a huge parking lot is likely a thing of the past as the modern office sector is embracing more hospitality-styled offerings to attract workers. 

All the progress is a stark contrast to what Denton County was like 15 years ago, when next to no projects were happening, SVN Verus Commercial Managing Director Greg Johnson said. The size, number and mix of projects underway across all categories is also encouraging for the county’s future.

“It just speaks to the great growth we've had,” Johnson said. “Those properties wouldn't be getting built and those spaces wouldn't be getting leased if the demand wasn't there for the goods they're selling.”