When it comes to the design of any type, trends have and will continue to play an important role. While some trends are superficial and inconsequential, there are others which it would be unwise to ignore. A fast-growing market is one of those trends. Always keeping an eye out for opportunities, we gathered data to see if there were any trends indicating multifamily development might be booming somewhere outside our current DC Metro-based market. We first opted to gather data from our own clients. We looked towards developers we’ve had the pleasure of partnering with over nearly twenty years and noted the locations of all projects they’ve delivered in the last three years (projected through 2021). Separating out all properties located in the DC Metro Area, our data indicated that many of our partners have recently developed multifamily buildings around these three regions within the US which stood out to us:
San Francisco Bay Area, California
Tampa and Orlando, Florida
Beyond this information, we began searching for recent publications highlighting booming markets (outside our current market) for real estate investment and development, and the results ended up reinforcing a few big cities we’d highlighted in our client-based research:
Charlotte, North Carolina
Tampa, Florida (again!)
Our data indicate a correlation, but the publications give us insight on causation for the uptick in development within certain markets. It can be easy enough to blindly follow developers to a new geographic market, but understanding why that new market is being targeted gives us a sense of how much fruit this tree may bear. From our research, new markets become appealing for many of the same reasons: Recent or pending additions of large corporations, an influx of new types of jobs (often related to those corporations), increasing diversity in population, and revitalized arts districts. The DC Metro Area has most, if not all these traits – so what makes any of the above regions appealing to us? What do most of those markets have, that ours doesn’t? The answer is a combination of high housing demand, low housing supply, and most notably, room to breathe. Apart from San Francisco, all cities listed above have an average population density of around 1/3 that of DC’s. For residents, this translates to less-crowded roads, sidewalks, and shops, more space between buildings, and more green space in general. For architects and developers, cities like these are an opportunity to be seized now, which will pay off for decades to come as demand rises and these cities fill in.
Working and investing in a new geographical market always has an element of risk to it, and risk can be scary. There are a lot of benefits to diversifying – putting your eggs in different baskets, so to speak – by not locking yourself into one location, much like a business wouldn’t depend on only one project/venture at a time to keep them afloat. With more offices working remotely now than ever before, this has never been more feasible. We’ve done our research, and we recommend you do too, for what works best for your business. If you’re considering developing in an up-and-coming city, or work in a market outside of the DC Metro area where architecture and interior design are booming, give us a call – we’re happy to step outside of our comfort zone for an exciting opportunity!