Wood Partners: Houston multifamily overview

HOUSTON – The Houston multifamily market is in the best shape it has been in a long time. For example, rents are increasing across the board, and occupancy is at its highest point in years, according to Todd McCulloch and Todd Gaines of Wood Partners.

It is common to assume that for every six or seven new jobs created, there is demand for one new apartment. Thus, Houston has added more than 90,000 jobs in the last 12 months, resulting in a demand of 12,000 to 15,000 units annually.

All in all, Houston’s multifamily market is healthy right now.

Investor focus may shift to suburban development by the end of this year. Tightening occupancy and low supply are driving concessions out of both urban and suburban markets. Supply will increase in the next 18 months, but supply will likely not meet demand during that time.

Some recently completed projects in the Houston market include the 256-unit Alta Woodlake Square in the Westchase District at the intersection of Westheimer and Gessner, which is part of the Woodlake Square Shopping Center. Another recently completed project is the 256-unit Alta Heights, located just north of the intersection of Heights Blvd. and Washington Ave.

The submarkets in Houston considered the hotspots for new development are the West Inner-Loop, the Galleria, Midtown, the Heights, and Katy.