Since the start of 2012, class-A apartment rents are up roughly 30% across the northern suburbs. This is a similar increase to class-A units in DFW overall. These units had been running full at 95% occupancy but now, occupancy has declined significantly, according to JLL, MPF and CoStar.

From 2016 to today, almost 21,000 new market-rate units have been delivered in the northern suburbs to accommodate the significant job growth that has taken place, especially in greater Legacy and around Cityline. And, the newest units carry a notable rent premium. Dallas North Tollway properties are 12% above class A or $150-plus per month and US 75 assets, while more modest, are still 6% and $80 per month higher. Importantly, the rapid increase in rents from a few years ago has slowed dramatically, as affordability at these top-end rents may have been reached–at least for the moment until the market adapts, says JLL.

New property lease-up is also slow, requiring extended periods to stabilize–sometimes more than two years–and has resulted in some assets de-leasing slightly as new projects deliver and compete for residents. For the new Dallas North Tollway and US 75 projects, the average pace is 18 to 19 units per month. This means the typical project requires 18 months to hit 90% occupancy, impacting base rents, concession burn-off and rent growth, JLL illustrates.

“The new class-A supply being delivered in the northern suburbs appears to be having an impact on the overall submarket occupancy level, but we view this as temporary,” David Fersing, vice president of JLL multifamily capital markets, tells GlobeSt.com. “Over the next 12 months, with continued job growth, corporate expansions and new companies coming to town, the demand for rental housing will bring the overall occupancy levels back above 90% rather quickly and won't have much impact on the middle market B/C space.”