FORT WORTH, Texas — Read this story and more North Texas business news from our partners at the Dallas Business Journal.
NexMetro Communities has continued its growth streak in DFW, closing escrow on two sites in Anna and Cleburne within the last month.
The luxury build-for-rent firm has rolled out a slate of projects in North Texas. Since opening its first DFW development, NexMetro has undertaken 3,000 homes locally, including those already built and currently under construction.
The company will soon open Avilla Boat Club in Fort Worth, a 107-home gated luxury rental home neighborhood, according to a news release. The sites in Anna and Cleburne will open for leasing by late 2024.
“Consumers are increasingly choosing to rent but don’t want to sacrifice the lifestyle of a home that they’ve worked to achieve,” Steve Fritzer, managing director for NexMetro’s DFW Division, said in a prepared statement. “We continue to see considerable demand in submarkets across Dallas and Fort Worth for our best of both worlds lifestyle offering.”
Recently, the Anna City Council cleared the way for a NexMetro Communities build-for-rent residential and commercial mixed-use development on 65 acres of vacant land along U.S. Highway 75 in the fast-growing city.
The development will include 27 acres of future commercial developable land that will tailor to restaurants, local retail, medical offices, banks and other retail and services.
The development will also have a 24-acre residential cottage community built by Phoenix-based NexMetro consisting of 211 detached single-family and duplex units with private backyards and one to three bedrooms per unit.
Dallas-Fort Worth leads the nation in build-for-rent home construction even as demand for the red-hot asset type nationally shows some signs of waning.
Build-for-rent homes constructed nationwide reached an all-time high of 14,541 units in 2022, and three times as many homes are currently underway, according to a new report by RentCafe.
DFW posted the highest number of build-for-rent homes completed in 2022, with 2,773 units. That’s a massive 441% increase year over year and a 10-year peak, according to the report.
North Texas' build-for-rent homes more than doubled in just five years, surging by 102%. More precisely, 3,955 units were added between 2017 and 2022, leading to a supply of 7,843 units throughout DFW – the second largest supply in the nation.
An additional 4,350 build-for-rent units are now under construction in Dallas-Fort Worth, which is the second largest number of upcoming homes for rent in the country, according to the analysis by RentCafe, part of Santa Barbara, California-based Yardi Systems Inc.
While the construction pipeline for build-for-rent is still booming, demand for new homes of this type has fallen nationally from the highs of recent years.
Estimates on build-for-rent construction vary widely based on data source.
But like the broader housing market, new construction of single-family rentals has cooled nationally in recent quarters, with build-fo-rent starts in the first quarter of this year 7% lower than the first quarter of 2022. The National Association of Home Builders estimates that in the four quarters ending Q1 2023, 69,000 single-family rental homes began construction, a 17% increase from the 59,000 estimated starts in the four-quarter period prior.