Dallas/Fort Worth Apartment Market Update Report

2007 In Like a Lion

Houston, TX (April 26, 2007) - In the Dallas/Fort Worth metroplex, the apartment market saw impressive growth in absorption and new construction, which influenced the growth in rent per unit and rent per square foot as well. However, occupancy rates declined from last quarter, mostly due to more construction.

This is according to the first-quarter apartment update reported by O'Connor & Associates, the Houston-based real estate consulting firm and leader in apartment market research data in Texas. The report tracks the growth of apartment living in the Dallas/Fort Worth metroplex.

Overall absorption during the quarter totaled 1,665 units, the highest quarterly figure since the fourth quarter of 2005. After a rough 2006 when only 146 units were absorbed the entire year, Class B recorded the strongest quarterly figure, with absorption of 1,116 units. Absorption was also positive in the Class A and C markets, as 430 and 475 units were absorbed, respectively. Class D was the lone class to post negative figures, absorbing -356 units over the quarter.

Dallas/Fort Worth area apartment occupancy fell for the second straight quarter, down 0.04 points overall. On average, apartments in Dallas/Fort Worth show an 89.68 percent occupancy rate. This is the second time since the second quarter of 2005 the occupancy rate fell below 90 percent. Class A properties fell 0.83 points to 91.86 percent; Class B increased 0.51 points to 91.60 percent; Class C increased 0.15 points to 87 percent and Class D fell 0.79 points to 84.44 percent. The highest occupancy levels were again in Granbury at near-capacity, followed by West Dallas at 95.28 percent. Downtown had the lowest occupancy rate at 77.56 percent. Though occupancy figures taken by themselves may be a bit disappointing, when taking into account the high level of new construction and positive absorption figures, the market is actually faring rather well, absorbing much of the new product that is coming online.

Rental rates also made strides in the first quarter. At $0.872 psf, overall rental rates were up $0.002 psf over the quarter. This is the highest level in more than two years. Class A properties showed a $0.003 increase and averaged $1.072 per square foot (psf); Class B rent remained unchanged at $0.855 psf; Class C increased $0.001 psf to $0.773 psf; Class D rents gained $0.003 psf to $0.710 psf.

Dallas/Ft. Worth has a total of 2,506 operating or under-construction projects greater than 25 units with a total of 562,028 units. Class A properties make up 28 percent, Class B make up 35 percent, Class C make up 29 percent and Class D make up eight percent.

For a complete report on the Dallas/Fort Worth apartment market, visit http://www.poconnor.com/file_repository/dallas_apt_update_1Q07.pdf. The report measures demand (absorption), occupancy, rates and apartment inventory.

About O'Connor & Associates
O'Connor & Associates, a Texas-based national real estate service firm providing appraisals, market research, cost segregation studies and federal and ad valorem tax reduction services, has been in business since 1974 and has more than 40,000 clients. Patrick O'Connor, MAI, president of O'Connor & Associates since 1983, is frequently acknowledged by national publications as a respected source of information on real estate trends.

ApartmentLink is your best source for apartment market data in Houston, Dallas/Ft. Worth, Austin and San Antonio. With information on owners, occupancy, rent, amenities, detailed property information, comparable information, and much more, ApartmentLink provides vital apartment information for on-site managers, vendors, brokers, owners and investors. The database is available online at oconnordata.com.

Ask about your FREE 10-Day trial for the most accurate online Texas apartment data today! Click here to sign up or contact Heather Wiesner at 713-375-4262.