Monday, February 09, 2015

Dallas’ urban apartment building boom is heading to the suburbs


The hottest rental housing markets for the last few years have been in some of Dallas’ oldest neighborhoods.
Uptown, downtown, East Dallas, the Design District and Oak Cliff have attracted thousands of young professionals looking for the latest in urban living.
Across the country, there is a surge in downtown residential construction.
Almost 30 percent of the apartments built in the U.S. since 2010 have been in the central business districts, according to a study by Carrollton-based apartment analyst MPF Research. That’s more than at any time since before World War II.
But while close-in neighborhoods have gotten more attention, a similar apartment boom is underway in the far suburbs, and it’s drawing the same types of renters.
“We’ve spent the last decade talking about the urban core, and the suburbs are becoming a new interesting story,” said Greg Willett, vice president with Carrollton-based apartment analyst MPF Research. “It’s an evolving environment where you are urbanizing suburban locations.
“And the jobs are already there; that’s what’s attracting the renters.”
This week developers in West Plano started construction on the first 621 apartments in the $300 million Legacy West development on the Dallas North Tollway.
Located 20 miles from downtown Dallas, the property has been an empty field and is surrounded by sprawling corporate campuses.
Come back in two years and you’ll find a dense, urban neighborhood that won’t be much different than what’s now along McKinney Avenue in Uptown. At least that’s what the developers hope.
Apartment builder Robert Shaw, who kicked off the Uptown housing boom in the early 1990s, is now building similar rental neighborhoods in West Plano and in McKinney’s Craig Ranch development. He says the renters are about the same, “but not as high of incomes today.”
So far Shaw says he’s been able to provide a suburban lifestyle that mimics an Uptown address but at a lower cost and near growing employment centers in Plano and Frisco.
“It is a much better price point for these young adult households,” Willett said. “Even though these are upscale properties, they cost notably less than an Uptown apartment.”
Despite the growth downtown and Uptown, new surveys of potential residents say the suburbs still have a strong appeal.
“Two out of every three millennials want to live in the suburbs,” said Rose Quint, a researcher with the National Association of Home Builders.
In fact, only about 10 percent of Americans born after 1977 want to live in in urban areas, Quint said the latest building industry surveys show.
“Compared to other groups, they are more likely to want to live downtown, but it’s a very small share,” Quint said.
No doubt the tilt toward the suburbs is because that’s where the biggest share of North Texas’ job growth is happening.
And most young locals grew up there.
“The urban core is not the destination for everybody,” Willett said. “We have really oversold that story.
“The suburbs are very vibrant in a lot of places around the country — with Dallas-Fort Worth at the top of that list,” he said. “We are seeing an integration of single-family homes with apartments and entertainment and retail in new communities.”
Steve Brown, The Dallas Morning News