Real Estate Investing in Dallas: How Origin Tackles investing in the Metroplex
Dallas is a city with a strong economic foundation ideal for for real estate investors. Image from Wikimedia Commons
Real estate in Dallas matches the bold vision of the people who created the city. Before Dallas was founded, there was never much in the way of permanent settlement in the area. French and Spanish colonists looked at the dry area, which featured some of the hottest summers in the country, and decided to keep moving. When the Republic of Texas became part of America in 1845, people surveyed the land and decided it could be a major metropolis. They were more right than they could ever have imagined. Dallas has boomed into one of the biggest cities in America, with the Dallas-Fort Worth region boasting the 4th most populated region in the country and making up an astonishing one-quarter of the Texas population.
At Origin Capital Partners, we understand the Dallas real estate market. We understand that even a city this big can keep growing, developing, and changing. It can grow internally and attract new jobs and industries, new people with new needs, and new developments. Dallas is still a shipping hub for the south and southwest, as well as for international business. This not only adds vibrancy, it also contributes to development by bringing in logistical centers, R&D labs, trucking/airline companies, and other industries that need housing.
A growing tech sector and a younger population is meeting a growing economy and an incredibly profitable commercial real estate market to make it a booming city for investors. Dallas is a city that never sits still. A site born on what so many saw as unprofitable land will always defy expectations. Origin Capital Partners is here to help you invest wisely in the Metroplex.
The Dallas Real Estate Market: As Hot and High As Its Sky
If you’re looking to invest in the Dallas real estate market, it’s important to understand not just how hot it has gotten, but also the underlying structure of the market. There are a lot of high-growth cities that seem unsustainable, but Dallas has much stronger fundamentals. That makes even a higher-priced market an area in which an investor can continue to expect growth. That can be determined by a few factors.
New industries are coming in, especially in the tech sector: In June 2015, Dallas had a 4% unemployment rate, which is already astonishing. Incredibly, that’s nearly half a point lower than at the beginning of the year. The economy is growing, especially in what was a historically weak tech sector. Nationally, Dallas ranks 5th in terms of most tech employees, and with those employees earning an average wage of over $100,000, they are fueling the local economy. In fact, the tech sector, which includes both huge corporate headquarters and a bustling startup scene, make a full 73% more than the Dallas average. This leads to demand and more companies moving in.
- Companies are moving to Dallas to meet the workforce: Often, a city develops because workers move to an area where jobs are plentiful. While this is certainly happening in Dallas, local economists are excited because jobs are also moving to meet the existing workers. There is so much talent in the region that companies are competing for workers. As they move here, they’re filling up available office space and creating the demand for more.
- Office space is reaching a premium: Companies that were previously consolidating are now expanding, intelligently. New companies coming in are scrambling to find the right spaces. This is causing the market to rise in a steady, yet sustainable way. Per-square-foot rental prices are at $126 in Dallas, which is a 10% increase over last year, but they aren’t reaching unsustainably high, pre-recession prices. There are similar trends throughout the metro region. Also encouragingly, campuses are being developed for larger firms. This leads to hub-oriented areas for workers, where they’ll need a place to live.
- Campuses and expansion lead to MDU development: Asking prices for multi-family dwellings in Dallas have risen 3.5% over the last 3 months and 10% over the year. These new, green, smart buildings appeal to a younger, more educated, and relatively affluent generation of workers.
All of these factors combine to make Dallas an exciting area for investments. There are strong fundamentals and slow, steady growth that make it a smart area to consider, if you know which neighborhoods are right.
Top Dallas Neighborhoods for Real Estate Investment
Some of the leading areas for Dallas real estate investments include:
Central Business District/Downtown: This is the heart of Dallas’s urban revival, home to huge companies, startups, an amazing restaurant and cultural scene, and a growing number of MDUs. This contains sub-neighborhoods like Uptown and Oak Lawn. A perfect area for younger tech workers to live, work, and play.
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- East Dallas: East Dallas, which is close to downtown, tends to be more residential, though areas like Deep Ellum are very artistic and attract an interesting crowd, as well as startups looking for office space. Lakewood and Vickery Place are residential, but with a growing MDU population.
- Preston Center: North of downtown, near University Park, this area was long known for high-end shopping, but is now opening new office buildings and becoming a high-tech extension of the central area.
- Far North Dallas: Far North Dallas is technically part of North Dallas, but with a distinct atmosphere and identity. Far North Dallas is strongly tied to inner suburbs like Addison and Richardson, as well as Plano and Frisco. These are rapidly growing areas, whose current low densities are very appealing to businesses looking to move out of the city center. Upscale shopping and dining at areas like The Legacy are drawing a younger crowd. This could be one of the next big areas for development in Dallas.
Las Colinas/Freeport: West of the city, between Dallas and Fort Worth, and with great airport access, the Las Colinas/Freeport area has long been a hub of corporate headquarters and business expansion. With the increase in relocated businesses, this area is set to rise.
The Dallas real estate market is on fire, but it is far from peaking. A young, educated, and growing workforce, in conjunction with a sustainable growth plan and a solid base of fundamentals, make this an attractive market for real estate investors. At Origin Capital Partners, our knowledge and research make us perfectly positioned to help your investments in Dallas grow from the once-dusty soil.
If you are a real estate investor looking to broaden your portfolio and join other investors in major developments in Dallas or other markets, Origin Capital Partners would be excited to work with you. At Origin Capital Partners, we have a powerful connection with the cities we invest in and we understand what makes them tick. We know which areas are booming and which commercial and residential investments will make the most sense moving forward. Our Funds deliver consistent returns, because we know how to make sense of the real estate market. Contact us today to talk about how your investments can grow with the city.
