Austin is leading all U.S. cities in office-using employment growth, even though its office vacancy rate remains well above the national average.

The Sun Belt filled the top five spots in office-use employment, which included Raleigh, North Carolina, Nashville, Dallas and Charlotte, according to a recent Avison Young report. Between 2019 and 2025, Austin’s office-using employment grew by roughly 34%. Raleigh saw the second-highest growth at approximately 23%. 

Avison Young attributed the trend to healthier demand and elevated leasing activity.

But despite job growth, Austin posted a 22.4% office vacancy rate in the first quarter, according to Colliers. This rate has remained flat year-over-year, with Q1 2025 reporting a 22.5% vacancy rate. The national average was 18.6% during the first quarter of 2026, CBRE reported.

However, there is hope on the horizon. With Austin leading the nation in office-use growth, the metro area’s vacancy rate is likely to gradually decline, Avison Young’s Regional Manager of Market Intelligence Ariel Guerrero told Bisnow. 

“With Austin’s office development pipeline now slowing significantly and the metro still leading the nation in office-using job growth, vacancy has likely peaked and should gradually trend downward over the next year,” he said.

Since 2020, nearly 14M SF of new office space has been delivered, causing a sharp oversupply, as noted by Cushman & Wakefield.

New office construction has slowed significantly as the market works through that oversupply. The pipeline had only 756K SF expected to be fully delivered by the end of the third quarter, according to a separate CBRE report. 

Additionally, Austin is reported to have positive net absorption in Q1, with 110 tenants seeking 4.4M SF of space, CBRE stated. The metro’s improving office demand mirrors the broader national trend, which CBRE reported as the eighth straight quarter of positive demand.

Guerrero said the expected decline in the vacancy rate likely won’t be uniform across all office building classes, at least not in the near term. Trophy and Class-A assets will see rates decline before what he described as “older vintage buildings.”

“In the meantime, it remains a tenant-favorable market, presenting a window for occupiers to secure long-term leases before conditions tighten and pricing power begins to shift back toward landlords,” he said.

Just under 1 in 10 homes that broke ground in the United States in 2024 was being built for a tenant, not an owner, according to John Burns Research and Consulting data. 

Single-family rentals accounted for more than 1 in 4 rental unit construction starts in 2024.

Investors poured a combined $57B into single-family rentals in 2021 and 2022. Capital flows slowed in 2023 as rising interest rates squeezed deals, but the sector bounced back, with investment nearly doubling year-over-year to $6.3B in 2024. Analysts expect more growth ahead. 

“This niche is only 6, 7 or 8 years old, but it gained a ton of traction, not only on the demand side from tenants moving into a purpose-built rental community but also on the development side,” said Chris Nebenzahl, vice president of rental research at John Burns. “Developers have seen that demand and have really met the demand.”

Single-family rentals have exploded into the housing market, with 124,825 new rental homes built since 2017. Unit completions have grown in each of the last six years, and 2024 set the new high-water mark for deliveries with more than 34,000 units, according to Point2Homes data, an SFR leasing platform and subsidiary of Yardi Matrix. 

Private equity continues to pour money into the sector to take advantage of macroeconomic and cultural shifts that have made renting more attractive. Persistently high home prices, exacerbated in the last two years by elevated interest rates, have contributed to the sector’s success.

Single-family build-to-rent homes accounted for 27% of all rental housing starts last year, and SFRs accounted for 9% of all single-family housing starts, according to John Burns. 

“Institutional investors are increasingly favoring purpose-built developments over acquisitions, further boosting the growth of SFR/BTR properties,” Doug Ressler, manager of business intelligence at Yardi Matrix, wrote in an email. 

New SFR construction was up 41% year-over-year in 2024 even as traditional housing starts fell by 2%, according to John Burns. A quarter of the SFR developers, operators and investors surveyed by the research firm expect to break ground on more units this year compared to last. 

Today, it is cheaper to rent than to buy in all of the country’s 50 top metros, with the median mortgage priced around $2,703 per month, while rent in a comparable city is around $1,979 per month, according to Bankrate. Homeowners, unlike renters, also have to contend with property taxes, insurance and repair bills. 

Renting becomes even more attractive when factoring in that 30-year mortgage rates are floating between 6% and 7%, up from the sub-3% rates that were common before the Federal Reserve tightening policy in 2022. 

“It’s still expensive, and we’re waiting for our incomes to come up, but you don’t hear that many complaints about rents anymore. But you’re hearing more about home prices, and that’s because home prices have continued to go up,” said Ken Johnson, a housing economist and the real estate chair at the University of Mississippi.

Homebuyers look at today’s prices and sense that the market is near a peak, giving them more reason to hold off on closing a sale, he said. There are signs that Wall Street investors agree.

The stocks of Invitation Homes and American Homes 4 Rent, the two largest public SFR firms, are trading somewhere between a 20% and 35% discount on their net asset values, The Wall Street Journal reported. 

Invitation Homes has been trading at a discount since early 2022, but the gap has widened by 10 percentage points over the last 12 months. With home prices elevated, large institutional investors that own more than 1,000 homes accounted for just 0.3% of U.S. home purchases in the third quarter, according to Point2Homes. 

Sun Belt markets have drawn the bulk of investment in the last five years, after the pandemic provided a burst of energy to existing migration trends driving Americans south. 

Nearly 4,300 new build-to-rent homes broke ground in Phoenix in 2024, the most of any major city. It was followed by Atlanta, which saw 3,236 units break ground, Dallas, Houston and Charlotte. Since 2017, developers have broken ground on 42,000 single-family rentals across those five cities alone. 

“The concept is going to be most effective in large metropolitan areas that are growing,” Johnson said, highlighting cities with large populations of young professionals.

But SFR owners and developers have found themselves in regulatory crosshairs in recent years as the nation’s housing affordability crisis deepens.

Lina Khan, the head of the Federal Trade Commission under former President Joe Biden, took a parting shot at SFR providers in the waning days before President Donald Trump took over the White House. 

The FTC issued a mid-January request for public comment seeking input about how the federal watchdog could probe SFR operators and their impact on the housing market. The investigation would target at least 30 firms, each of which owned at least 1,000 rental units, the FTC said. 

“This proposed study would shed much-needed light on the mega-investors that have amassed huge portfolios of single-family rental units and potentially contributed to the housing challenges that Americans face,” Khan said in a statement at the time. 

FTC commissioners unanimously approved the notice, but it is unclear whether Trump’s nominee to replace Khan, Andrew Ferguson, will follow through with a probe. 

Private equity’s interest in housing has drawn scrutiny for years, including a 2022 ProPublica investigation that found the investment firms were behind 85% of Freddie Mac’s largest apartment deals since 2013.

Earlier this year, New York Gov. Kathy Hochul proposed blocking hedge funds and private equity firms from buying up large numbers of homes in the state. Similar proposals have been floated in Nevada and Minnesota. 

Analysts who spoke to Bisnow said private equity’s interest in single-family housing was a positive development for housing affordability. The build-to-rent communities popping up across the country are a supplement to housing options rather than a replacement, they said. 

It takes tens of millions of dollars in upfront investment to build homes for rent, and the cash has to come from somewhere, Johnson said. 

“We see politicians saying that we don’t need Wall Street or private equity in the rental market or building homes for ownership. That’s a prescription for disaster,” he said. “I don’t hear people saying we don’t need professional investors in the stock market. People that know what they’re doing create price efficiency and liquidity in the housing market.”

Wingspan Development Group announced that WDG Finance has closed the $16 million WDG GP Fund II, its second since 2021, to fuel the firm’s multifamily development business growth in Illinois, Wisconsin, and Florida.

Nearly 40% larger than WDG’s GP Fund I, with an average investment about 50% higher, the $16 million fund will participate in the equity of five ground-up projects: The Henry at Harms Woods in Skokie, Ill.; The Whitt in Riverview, Fla.; Wekiva Ranch in Apopka, Fla.; The Pabst Farm Development in Oconomowoc, Wisc.; and The Vue in Elk Grove Village, Ill. It will also fund a preferred equity position in NICHE in Tampa, Fla. All six properties are developed in partnership with Wingspan’s sister company, Nicholas & Associates, a full-service contractor.

Wingspan currently has nearly $900 million in multifamily assets, including over $350 million in stabilized assets and about $500 million in entitled projects under development across several Chicago suburbs, Southeast Wisconsin and Central Florida.

Preleasing at Yardi 200 schools hit 89.2% in July, down slightly from 2023’s performance, while rent growth slowed, according to the latest Yardi Matrix National Student Housing Report. The student housing sector was still 5% behind fall 2023 occupancy levels as July ended, although 41 universities in the Yardi 200 have already exceeded occupancy levels of a year ago, led by the University of Nebraska.

As of July, the average advertised asking rent per bed reached $897 at Yardi 200 schools, a 4.7% increase year-over-year. Across the Yardi 200, 36 universities recorded at least 10% Y-O-Y rent growth in July, while 34 schools were below last year’s levels. Markets with high rent growth tended to also demonstrate strong enrollment growth.

“Rents have remained flat for the past five months and rent growth has dropped from close to 7% early in the leasing season as the preleasing pace has slowed,” wrote Matrix analysts. 

Georgia state lawmakers are trying to put the brakes on the proliferation of data centers spreading throughout the state, especially in the Atlanta metro area. A CBRE report suggested the region experienced a 211% increase in data center projects under construction between 2022 to 2023, the largest increase in the nation.

The Georgia Senate has voted to suspend tax breaks for data centers while a special commission reviews grid capacity in the state. The bill has already been passed in the state house. Georgia has given data center operators an exemption from the state’s sales tax since 2018. Besides overloading the grid, lawmakers commented that the centers hire few workers, in relation to the tax breaks they receive.

The Atlanta Business Chronicle reports that Atlanta City Councilmembers all signed onto legislation that would ban data centers from being built within the BeltLine Overlay District and within a half-mile of transit stations. Councilmembers bemoaned the fact that data centers are taking up space that could be used for other uses.

The medical office market in the Tri-State New York metro area, encompassing NYC, NJ, CT, and Long Island, displays diversity, with strong demand and unique structural characteristics in each locality, according to JLL’s TriState medical office report. 

In Manhattan, medical offices are typically situated within mixed-use buildings, offering convenience in the bustling urban landscape. Conversely, the Outer Boroughs feature a combination of spaces in mixed-use and standalone buildings, primarily in less densely populated neighborhoods. Manhattan commands higher rents due to its central location and density, while less dense areas provide more affordable alternatives. 

Furthermore, with individuals over the age of 55 constituting 30% of the U.S. population and the elderly population aged 80 and above expected to grow by 50% within the decade, there is a projected significant increase in demand for outpatient healthcare services. In the Tri-State area alone, outpatient demand is anticipated to grow by 6-10% over the next five years across much of the region. 

With 2023 now behind the retail sector, the current year nonetheless continues some of the headwinds that blew across the previous one. However, says Placer.ai in a new report, “every challenge also brings with it new opportunities, and many retailers are adapting to meet their customers’ changing wants and needs.” 

Titled 10 Top Brands to Watch in 2024, the white paper analyzes location intelligence and consumer demographic insights to identify 10 retailing brands gearing up for growth. The brands vary in their approach, as do the product categories they carry. 

“Some, like low-cost apparel and home furnishing stores, are benefiting from consumer trade-down,” according to Placer.ai. “Others are expanding into rural or suburban areas to meet customers where they are.” And although Macy’s recently made headlines by announcing plans to close approximately 150 underperforming locations, the white paper identifies a department store that is poised for growth this year. 

Courtesy of Franklin Street

Franklin Street has appointed Matthew Harrell as CEO.

The founder and chief executive of Tampa-based Franklin Street is passing the leadership baton to one of his executives as the full-service commercial real estate brokerage plans further expansion in the Sun Belt.

Andrew Wright is stepping back from the top job at Franklin Street, the firm announced Monday, to be replaced by Chief Revenue Officer Matthew Harrell as the new CEO as part of a planned succession.

Wright is stepping back from day-to-day activity, but he said he will remain chairman of the board of directors and be involved in the growth of the firm moving forward. Franklin Street operates seven business divisions: investment sales, tenant representation, landlord representation, capital advisory, insurance, property management and project management. 

“We are very much aligned in our core values,” Harrell told Bisnow. “This has been a strategic plan for this transition for a number of years.”

Franklin Street was founded in 2006 and today has 300 professionals with offices in Tampa, Fort Lauderdale, Jacksonville, Orlando, Miami, Atlanta and Chicago and has conducted $7B in transaction value, the company said in a release. Under Harrell’s leadership, Franklin Street plans to continue its national expansion by looking to recruit brokers and acquire firms for all its business lines in high-growth markets, especially in Dallas, Houston, Austin, Nashville and Charlotte.

Last year, the firm’s revenues grew 50% to $1.43B, Franklin Street said in a release. Harrell said Franklin Street is particularly focused on growing its capital market services division in the Sun Belt.

“Capital markets is a strategic line of business that we feel can give the most opportunity to feed other lines of business in the long term,” he said. “But again, what we’re looking for is the people behind those businesses.”

Harrell was named chief revenue officer last year and was tasked with recruiting and merger and acquisition activities for Franklin Street. Prior to that, Harrell served as managing director of the firm’s insurance services division and a member of the board of directors since 2012.

“Over the past 13 years, no one has been as integral to Franklin Street’s growth, success and quality of culture as Matt Harrell,” Wright said in a press release. “There is unlimited potential for what we can accomplish in the coming years, and I am excited to see Matt lead us there.”

Houston is among several U.S. metros expected to see a significant drop-off in migration for at least the next year, as the city continues to experience large job losses brought on by the combination of the coronavirus pandemic and low crude oil prices.

Prior to the pandemic, certain markets with lower costs of living like Houston, Phoenix, Charlotte, Las Vegas and Atlanta were experiencing significant population growth, correlating with strong job growth. 

That trend could reset in the next year or two, as more expensive, weak-growth markets with highly educated populations may retain and attract more workers, according to new research from CoStar.

CoStar Managing Consultant Andrew Rybczynski told Bisnow that subdued population growth would mean rising vacancy rates in Houston’s multifamily sector, inevitably leading to a slower pipeline.

“Projects that are underway are particularly vulnerable, as they are likely seeing their construction timeline stretched and will probably deliver into a weak demand environment,” Rybczynski said.

“Twenty-five thousand units are underway in Houston right now compared to less than 10,000 in the fourth quarter of 2017. There’s a good chance that units underway number drops down by significant amounts again.”

From 2012 to 2016, year-over-year population growth in Houston ranged from 2% to 2.7%, according to Oxford Economics data. But since Q4 2016, year-over-year population growth has never exceeded 1.8%, and dipped as low as 1.2% in early 2018, Rybczynski said.

That growth recovered to 1.7% in Q1 2020, but given the massive loss of employment across all sectors, it’s likely that there will be lower population growth figures, he added.

Houston consistently ranks toward the top of large markets in terms of growth. Even when Houston is growing slowly — by Houston standards — it still grows quickly in relation to other large metros.

“We expect Houston’s growth to slow through this down cycle, but for it to maintain strong growth compared to other large metros like Los Angeles, New York or Chicago,” Rybczynski said.

It is likely that Houston will still continue to enjoy net in-migration, even if the growth slows. More people were looking to move to Houston between Jan. 1 and April 15 than to leave, according to the latest renter migration report from Apartment List.