Dallas issued fewer construction permits over the last 10 years than all other major cities in Texas.
The Lone Star State is home to the top five cities for construction permit activity in the U.S., but real estate development in Dallas ended up falling short of other Texas cities over the decade, according to a new report by self-storage website StorageCafe.
StorageCafe analyzed new construction activity in the country’s 100 largest cities from 2013 to 2022 to determine which cities experienced the most notable changes in real estate construction activity based on data from the U.S. Census Bureau, Yardi Matrix, and Commercial Edge.
The top five cities for real estate development in Texas included Houston in the top spot, followed by San Antonio, Austin, Fort Worth, and then Dallas.
“The Sun Belt region has been experiencing tremendous growth, with 15 of the top 20 cities with the highest volumes of real estate construction from 2013 to 2022 being Southern or Southwestern urban hotspots,” said StorageCafe.
Although Dallas fell short in some areas of development compared to its Texas neighbors, the city did experience elevated multifamily permit activity and robust development activity for industrial and self-storage projects.
“Big D recorded the most spectacular advances in industrial construction, with over 31M square feet of new space delivered from 2013 to 2022. But multifamily is also shining in Dallas,” said StorageCafe.
“The city experienced significant growth in its technology and startup sectors, with a number of innovative companies establishing headquarters or offices in the area, which in turn attracted young, skilled workers. This reverberated, as expected, in the residential sector, and almost 69K new apartments were permitted in Dallas over the past decade,” StorageCafe said.
While permitting for commercial and multifamily projects was able to flourish over the last 10 years, the same cannot be said about construction activity for single-family projects.
Dallas approved roughly 17,000 single-family permits between 2012 and 2022 compared to the 34,000 to 55,000 permits issued in other parts of Texas over the same 10-year time period.
Building permits in Dallas are processed by the city’s Development Services Department (DSD), which is responsible for reviewing building plans, issuing permits, and ensuring sustainable land development in Dallas. DSD is headed by Andrew Espinoza, the director of DSD.
Prior to Espinoza taking over as Development Services Director in June 2022, Dallas’ permitting process had developed into quite a hindrance for local building professionals.
Besides the extensive backlog of single-family permits that built up over the years, developers in Dallas also had to contend with DSD’s long permit turnaround times.
During the summer of 2022, DSD averaged around 35 days for most residential projects and around three to four months for larger commercial projects, according to historical data from the city. In many cases, this has caused construction projects to go over budget and past schedule, as previously reported by The Dallas Express.
This issue was allowed to languish for several years under the supervision of Dallas City Manager T.C. Broadnax, who accepted the position back in 2017. While the turnaround time for single-family permitting times has come down from all-time highs, the median issuance time still comes in well above DSD’s 15-day performance goal.
More details about StorageCafe’s top 20 hottest markets for new development can be found here.