Déjà
Vu
Development
Multifamily construction revisits
secondary and tertiary markets.
An oil-producing formation
called the
Cline Shale was recently discovered in West Texas. Soon workers
descended upon the tertiary cities of Midland and Odessa, drawn
by the new oil-feld jobs. Brian J. O'Boyle, CCIM, managing broker with Apartment Realty Advisors in Dallas, along with ARA's
small-market specialist Bart Wickard, has been tracking the resulting uptick in multifamily development. He notes that, as of April,
Midland had approximately 3,150 apartment units planned or
under construction and Odessa had 2,800.
"In these two markets, developers are targeting any land they can
get their hands on," O'Boyle explains. Texas-based development
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July | August | 2013
companies see the growing demand and lack of supply in the area
frsthand, and they've recently found themselves competing with
oil companies for land sites, O'Boyle adds.
But Midland and Odessa aren't the only noncore cities seeing an
uptick in multifamily development activity. Job growth and pentup retirement demand are drawing new tenants to markets from
Seattle to South Florida. And with access to inexpensive debt and
fexible loan terms, developers have begun to respond to the new
demand outside of primary markets. Tis is refected, in part, in
the numbers: Tere were 233,900 new multifamily starts in 2012,
up from 167,300 in 2011, according to the U.S. Census Bureau.
Commercial Investment Real Estate
YellowCrest/Veer
by Rich Rosfelder