San Antonio’s multifamily market has historically been exempt from the fluctuations typical of other Texas cities. While San Antonio has had its share of new deliveries over the years, the multifamily stock has not increased in step with its Texas contemporaries. The traditional engines of the city-- hospitality, health care and the military--provide a rock-solid foundation, but do not offer the types of high-paying wages that drive rent growth and new construction. New construction has also been inhibited by a lack of institutional capital flowing to San Antonio because it was perceived as a “low growth” market.
Things, however, are changing. Job growth in industries such as energy, manufacturing, and the financial sector are drawing families to the region like never before, just as long-time San Antonio organizations such as USAA, the Medical Center and the University of Texas—San Antonio (UTSA) continue to expand. As a result of new jobs and a nationwide regression of home ownership rates to more historic levels, San Antonio’s multifamily market is seeing a rapid increase in demand. Developers, both local and national, have begun planning new developments... As of August 2012, San Antonio multifamily properties boast an overall occupancy rate of 92.9 percent. As new units become available, the marketplace swiftly absorbs them: in the past 12 months, the market absorbed 3,048 of 3,338 delivered rental units. With such growth and economic diversification, San Antonio is positioning itself to compete with Texas’ other primary markets for the investment dollars of institutional capital.
Read more...San Antonio Multifamily Market Report via REBusinessOnline.com
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