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Good morning. DFW’s multifamily market is taking a breather, with negative absorption, softer rents, and slipping occupancy closing out 2025. But as construction continues to contract, the groundwork for a late-2026 rebound may already be in motion.
Today’s issue is brought to you by Mason Joseph Company—the most trusted FHA lender in Texas with 105 construction loans closed since 2016.
Market Snapshot
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Market Rebalance
Multifamily Construction in DFW To Slow Significantly in 2026
DFW’s apartment market is feeling near-term pain, but a sharp construction slowdown could set the stage for a rebound by late 2026.
Demand turns negative: DFW multifamily demand dropped to -301 units in Q4 2025, a sharp reversal from 14,161 units absorbed at the end of 2024. Intown Dallas and Oak Lawn/Park Cities saw the biggest losses. Occupancy slipped 20 bps to 93.1%, marking a second straight quarter of declines across all asset classes.
Source: Colliers
Rents slide: Average asking rents fell by $12 to $1,482 compared to year-end 2024. The drop is attributed to both soft demand and landlords offering more aggressive concessions to retain tenants.
Construction pullback: Construction activity fell for the 13th straight quarter to 42,702 units, with new supply dropping to 8,115 units. By Q4 2026, Colliers expects deliveries to nearly triple to 23,000 units, while new starts dip below that—hinting at a market nearing balance.
Turnaround in 2026: Colliers forecasts a late-2026 rebound, with demand reaching 25,689 units, rents rising to $1,517, and occupancy reaching 93.5%. The firm notes “stability remains the focus” as the market rebalances.
➥ THE TAKEAWAY
Rebound potential: After a rocky 2025, DFW’s multifamily market could be poised for a rebound—if demand returns as projected and construction continues to ease. For investors, 2026 may offer renewed opportunity.
TOGETHER WITH MASON JOSEPH COMPANY
105 FHA Construction Loans Closed Since 2016
Mason Joseph Multifamily Finance has closed 105 FHA-insured construction loans in Texas over the last decade – more than the next three FHA lenders combined.
That's why San Antonio–based Mason Joseph is the most trusted lender for high-leverage, low-interest FHA financing.
Whether your next multifamily development is in Texas, or any of the 49 other States, send us your budget & pro forma and in 24 hours we can tell you how an FHA-insured loan will improve your returns.
*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.
Around Texas
➥ Fifth Third Bank is expanding its Texas retail footprint with new branch leases following its acquisition of Comerica, signaling a selective but strategic market push.
➥ CP Group secured multiple new office leases at Five Post Oak Park in Houston, underscoring renewed tenant demand for well-located, amenity-rich assets.
➥ A Trammell Crow–led JV is expanding its northwest Houston industrial portfolio, betting on sustained logistics and manufacturing demand in the region.
➥ Fort Worth unveiled plans for the next phase of its convention center expansion, aiming to drive long-term tourism growth and downtown economic momentum.
➥ ICE’s growing real estate footprint is driving new property leases and acquisitions across Texas, reflecting increased federal demand for detention and administrative facilities.
➥ DFW claimed the top spot for CRE investment for the fifth straight year, per CBRE's 2025 survey.
Follow the Money
| MULTIFAMILY DALLAS StreetLights and Mitsui Fudosan are moving forward with a high-end multifamily development in Dallas, targeting affluent renters despite a cooling supply pipeline. |
| INDUSTRIAL AUSTIN Jackson-Shaw is planning a 1.2M SF industrial development near Austin, reflecting continued confidence in Central Texas’ long-term distribution fundamentals. |
| DATA CENTER HOUSTON A Lincoln-led JV landed a data center construction tenant in Houston, highlighting the region’s growing appeal for digital infrastructure investment. |
| OFFICE FRISCO Hall Group is breaking ground on a $140M, 10-story office building at Hall Park, continuing its $7B transformation into a mixed-use hub in one of North Texas’ hottest corporate corridors. |
| MULTIFAMILY DALLAS The Bascom Group sold a 424-unit DFW apartment community, capitalizing on investor interest in stabilized Sun Belt multifamily assets. |
| DEVELOPMENT AUSTIN Several high-profile downtown Austin development sites tied to Nate Paul are heading to market, marking a major unwind of once-ambitious projects amid ongoing legal and financial pressures. |
| MULTIFAMILY AUSTIN Griffin secured a refinancing for its Austin apartment properties, signaling lender confidence in stabilized multifamily assets. |
📈 CHART OF THE WEEK
Over 3 MSF of new AI-powered data centers are under construction in North Texas, signaling a major expansion of digital infrastructure.
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