Construction Pipeline Continues to Increase Activity
by Jordan Brooks , Senior Market Analyst , ALN Apartment Data
The story of multifamily performance so far this year across Greater San Antonio comes down to the basics of supply and demand . A dramatic increase in new deliveries has been paired with apartment demand that has improved from last year – but not nearly enough to match supply . The result has been downward pressure on occupancy and rent . It has been almost six months since the last breakdown of the construction pipeline in these pages , so it is now time for an update .
Average occupancy has been on the decline for almost a full year now , which has finally taken most of the wind out of the rent growth sails . The Greater San Antonio region has not been immune to these national trends . However , the second quarter did bring some measure of improvement relative to the opening three months of 2023 . All numbers will refer to conventional properties of at least fifty units .
Recent Deliveries
More than 4,000 new units have already been delivered across the region through July of this year . In recent years , the closest the area has seen to this type of supply volume was in 2018 when around 3,800 new units were delivered in the same portion of the calendar . Even including that high-water mark from the recent past , the average number of new units introduced through July over the last five years was approximately 2,500 units . This year is the first to surpass that average since 2020 .
Recent deliveries have been fairly concentrated geographically , and the more outlying submarkets have been at the center of the activity . The Greater New Braunfels area has added just over 1,000 new units through July . The Far West San Antonio submarket , a region west of Interstate 410 and north of Highway 90 , has seen the second-most deliveries so far this year with just less than 1,000 units . The Boerne – Comfort portion of the market has also been active with just more than 600 new units coming online in the first seven months of the year .
Only seven of the twenty-five ALN submarkets for Greater San Antonio have seen new supply so far this year . Despite the significant uptick in total output , there has not yet been a broadening in the area of deliveries . However , this will not be the case for much longer .
23 AUGUST 2023 | WWW . SAAAONLINE . ORG