MPF Research Wrap-Up: Top Submarkets for Apartment Construction
Our recent countdown of the nation’s 10 busiest submarkets for apartment construction reported by MPF Research comes to a close with this overview of some of the themes that seem to pop up over and over.
One recurrent theme: character. Most of these submarkets have a personality of some sort, or are trying to create one, rather than being examples of generic suburban sprawl.
Many are urban neighborhoods once largely abandoned after dark, but now reborn as intriguing and hip places to live, work and play. As young professionals have drifted back into these city centers, retail, restaurants and modern mass transportation options have followed, along with developers creating interesting mixed-use projects. Already in place in many cases were entertainment venues and large employers, adding to the appeal of these urban centers. Local government initiatives to encourage the downtown live/work/play environment have accelerated the trend and improved the appeal of these cities as a whole; no city wants a downtown that becomes a ghost town after dark.
Even the more peripheral hot submarkets, away from city centers, have begun to take on a more urban look with multi-use developments combining apartments and retail. Young professionals, the core demographic for most current multifamily developments, are gravitating towards developments with a “hip” feel as opposed to the generic looking suburbs of the past.
Other than character, factors attracting renters are largely what you would expect: retail and restaurants, entertainment, walkability and bikability, parks, workout options, and extras such as dog parks and bike trails.
The vast majority of new housing has been conventional market-rate apartments. There’s been very little development of senior, student or affordable properties.
If you missed a previous post in our series, revisit the top 10 submarkets for apartment construction:
To close this series, here’s a look at the submarkets MPF Research identified as numbers 11 through 20 on the “hottest submarket” list, rounding out the Top 20:
11. Memorial, Texas
Boasting the impressive CityCentre development, this rapidly developing area is drawing attention for its upscale shopping options like Town & Country Village and a growing list of top employers. The area is serviced by multiple major roadways, allowing for easy access to all of the expanding metro’s amenities and employment opportunities.
12. Katy, Texas
While this submarket includes multiple cities west of Houston, the city of Katy has experienced the majority of the submarket’s multifamily development. I-10 provides the submarket with access to hundreds of employers. Katy itself is surrounded by various major employers and conveniently borders Houston’s Energy Corridor.
13. Spring/Tomball, Texas
Located north of Houston, the Spring/Tomball submarket has expanded its multifamily housing base by 57.5% since the first quarter of 2012. New apartment construction has been concentrated in the town of Spring, around the new ExxonMobil campus off of I-45. This submarket is also within commuting distance of downtown Houston, and lies in the path of the northward creep of the nation’s fourth largest city.
14. Intown Dallas, Texas
This high-rent submarket in Dallas is a perfect example of a “hip” urban submarket attracting young professionals. Popular neighborhoods within the area include downtown, Uptown, Victory Park and Deep Ellum, an updated warehouse district. Other key drivers for the area are the large downtown employers and an expanding park system.
15. Broomfield, Colorado
Located in the Denver/Boulder metro, this submarket saw a 57.2% jump in apartment inventory since 1st quarter 2012. Broomfield has emerged as a corporate and technology hub, providing ample high-paying jobs to support its growing housing base. Broomfield is also serviced by multiple major roadways, and since it is situated halfway between Denver and Boulder it offers access to both to those who live here.
16. North Fort Worth/Keller, Texas
This area saw rapid expansion before the recession, which diminished after the economic downturn. The recent uptick in multifamily development can be attributed to easy access to downtown Fort Worth via I-35, great schools and proximity to employment hubs. This submarket features the massive AllianceTexas development with its many new jobs.
17. Downtown Indianapolis, Indiana
Another example of the resurgence of an old downtown area. This submarket boasts easy access to major roadways, including the intersection of I-65 and I-70 at the heart of the submarket. Strong economic drivers include a solid base of large employers and corporate headquarters, along with multiple large universities. It’s now a work/live/play area and is highly walkable – a big attraction for residents.
18. Rockwall/Rowlett/Wylie, Texas
This rapidly developing submarket is located on the northeast side of the Dallas metro. The cities of Rowlett, Rockwall and Wylie offer residents an alternative to the hustle and bustle of urban life, while still being within driving distance of the metro’s various amenities. Rockwall is also coming into its own as an employment center, with Technology Park providing an example of the commitment to local development.
19. Midtown Atlanta, Georgia
Midtown Atlanta boasts several demand drivers, including proximity to major universities like Georgia State University, Emory University and Georgia Institute of Technology. The submarket also has a solid base of entertainment options, including a lively nightlife and bar scene, as well as ample cultural activities with venues such as Fox Theater and the Arts District. This walkable area of Atlanta also features multiple parks and plenty of walking and biking trails.
20. Oak Lawn/Park Cities, Texas
This affluent Dallas submarket is located just north of the downtown and Uptown areas. Oak Lawn has a history of funky character, and the neighboring Park Cities (University Park and Highland Park) are prized for their safety, superb schools and private fire and police departments. The area hosts Southern Methodist University, prime shopping, access to the metro’s employment hubs and a tight-knit community.
We hope you’ve enjoyed and learned something from our tour of the top multifamily submarkets. Be sure to turn to MPF Research, the nation’s leading multifamily research company, for research that will help you make profitable business decisions!