Friday, February 24, 2012
Greater Dallas Apartment Boom Will Be Held In Check
Seems like a week doesn’t go by without word of a new North Texas apartment project in the works.
Some weeks there are two or even three deals.
While apartments are the current favorite flavor of real estate developers and investors, don’t expect the kind of overbuilding that usually results.
That’s because tight financing is still holding developers back.
“It will definitely keep the supply managed,” said Dallas apartment analyst Ron Witten. “The banks are eager to do construction loans, but they are pretty selective to do them with companies they are comfortable with and just great deals.
“We are not going to be immediately back to the races.”
Apartment starts rose about 70 percent in North Texas in 2011. But that was coming off a very low base.
Most analysts predict that 2012 will see another increase in starts, depending on how quickly builders tie up construction sites, get zoning and arrange funding.
Witten predicts that Dallas-area apartment starts will total about 9,500 units this year. That will still make Dallas one of the top apartment-building markets in the country.
Along with financing issues, developers could face more difficulty attracting equity...
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