Greater Fort Worth Demand Finally Cooled in October
Apartment demand for Greater Forth Worth through October of 2021 has been substantially beyond anything seen in more than five years. For six straight months, from April through September, more than 1,000 net conventional units were absorbed across the market. As is typical in the highly seasonal multifamily industry, demand finally cooled off some in October.
Numbers will refer to conventional properties of at least 50 units.
Greater Fort Worth Overall
Net absorption through October stood at more than 10,500 units. Last year, though the COVID-19 pandemic affected rent growth throughout the year, apartment demand began its recovery in the summer. As a result, last year’s mark of more than 6,000 net absorbed units had been the largest number in recent years before the dazzling result in 2021.
Encouragingly, the overperformance has not just been driven by strong results within the lease-up space. When isolating only properties that entered the year already stabilized, this year’s net absorption of more than 3,000 units easily outpaced last year’s 2,000 net units during the same period. As with the market as a whole, last year’s result was also well above the established average from recent periods, making the 2021 result even stronger by comparison.
Price Class View
Results have been well-rounded at the price class level as well. Each of the four subsets has surpassed last year’s demand through October, particularly in the Class B space. More than 4,000 net absorbed Class B units compare favorably to around 1,800 net units by October of 2020 and were more than four times more units than in the same portion of 2019. Class A properties have also performed well. More than 3,700 previously unoccupied units have been leased this year, up from about 2,600 through the first 10 months of last year.
The bottom two price tiers have had a strong year as well relative to the previous history, but especially Class C properties. Net absorption of just over 2,000 units was approximately 600 units more than last year and four times as many units as in 2019. In the Class D subset, though a little more than 600 net units absorbed this year bettered 2020, it was by a very slim margin. Even so, this year’s demand was also more than four times that of 2019.
Thanks to strong demand across the board, though Greater Fort Worth entered the year with both Class A and Class B average occupancy below 90%, not price class closed October below 90%, and both Class C and Class D average occupancy finished the month at 95%.
Submarket View
Of the 12 ALN submarkets for Greater Fort Worth, only East Fort Worth has suffered negative net absorption this year – and only by about 10 net units. Arlington lagged the overall market as well, with the three lowest totals to at least be in positive territory all being Arlington submarkets. The Central Fort Worth submarket, with more than 2,500 net absorbed units, has led the way in 2021 demand. North Fort Worth, with just over 1,700 net units newly leased managed second-most. The more outlying Grapevine – Roanoke – Keller region was the only other submarket to top 1,500 net absorbed units, just crossing that threshold.
Takeaways
2021 has been a strong one for Dallas – Fort Worth broadly, and Greater Fort Worth specifically. Six consecutive periods of monthly net absorption above 1,000 units finally came to an end in October, but more than 10,000 net units have been absorbed this year in total. Even better, the demand has not been too heavily skewed toward only one or two submarkets or within a certain price class.
Properties that entered the year already stabilized have absorbed more net units through October of this year than in the last five years combined for that portion of the year – and not by just a handful of units. Similarly, all four price classes have outperformed recent years, with the top three tiers able to do so by a significant margin.
The industry is now heading into the traditionally softer part of the calendar for apartment demand, and much uncertainty remains in the broader economy, but 2021 has already been a year for the history books.
Jordan Brooks
Senior Market Analyst – ALN Apartment Data, Inc
Jordan@alndata.com
www.alndata.com
Jordan Brooks is a Senior Market Analyst at ALN Apartment Data. In addition to speaking at affiliates around the country, Jordan writes ALN’s monthly newsletter analyzing various aspects of industry performance and contributes monthly to multiple multifamily publications. He earned a master’s degree from the University of Texas at Dallas in Business Analytics.
