CRE Snapshot: Mid-Cities Multifamily
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The multifamily sector in the Mid-Cities — a swath of suburban cities that lie between the major metros of Dallas and Fort Worth — are catching the eye of real estate investors.
These cities have a combination of leasing dynamics and economic fundamentals coupled with strategic access to Dallas and Fort Worth that will make them an area of investor interest in 2019, according to CBRE Research, which compiled data on the Mid-Cities submarket for Bisnow.
Here is what makes this submarket attractive:
1. A quarter of DFW's population is in the Mid-Cities.
2. Rent growth is on the rise for Mid-Cities submarkets, such as Arlington, North Richland Hills, Irving, Hurst, Euless and Bedford. Monthly rents have moved up from $1,045 in 2017 to $1,080 in 2018, a 3.29% increase — outpacing area inflation of 2.1%.
3. The submarket contains top school districts that will continue to attract multifamily demand. Seven out of the top 20 school districts in the Dallas-Fort Worth Metroplex are within the Mid-Cities, making the area attractive for renters with young children.
4. A key advantage to this area of the Metroplex is accessibility to Dallas-Fort Worth International Airport, as well as being close to the urban corporate employment centers of Dallas, Fort Worth and Las Colinas.
The Mid-Cities areas with perhaps the brightest futures are:
Arlington: Mixed-use developments such as Texas Live! and 101 Center have increased residential and commercial interest. Real estate investors are intrigued by this submarket, because it gives them an alternative to the higher valued northern Dallas submarkets. Arlington’s vacancies are also below the metro average and it has a large renter residential base.
Grand Prairie: This city, which includes portions of Interstate 20, I-30, Texas 360 and Texas 161, should experience strong future demand for workforce rental housing because of its position near DFW’s thriving industrial sector and the Great Southwest Industrial submarket. On the flip side, the area saw its first luxury apartment in many years in 2016 when the Class-A 249-unit Bexley Central Park opened.
Grapevine: This historic city has one of the highest median household incomes in the area and is attractive for a variety of reasons, including that a portion of DFW Airport falls within its boundaries. Its historic Main Street, its shopping and entertainment options and its school system also have attracted real estate investor interest. Grapevine has 1,000 Class-A units under construction or in lease-up. New Grapevine development is being driven by the opening of Grapevine’s TEX rail station, which connects DFW Airport to downtown Fort Worth.