CBRE brokered the sale of Baybrook Passage, a 189,334-square-foot shopping center at 19425 Gulf Freeway in Webster, Texas.

Mark Witcher, Jolie Duhon, Chris Cozby, Jim Batjer and Harrison Tye with CBRE National Retail Partners arranged the transaction on behalf of the seller, Gulf Coast Commercial Group. The buyer, SLS Properties was self-represented.

The shopping center was built in 2003 and is anchored by Best Buy and Staples. Additional tenants include Boot Barn, Skechers, and Memorial Hermann, as well as a national roster of food & beverage, medical and service-oriented retailers. At the time of sale, the property was 97.2% occupied by 29 tenants with an average tenure of 18 years.

The multifamily housing sector is expected to experience steady, if unspectacular, growth in 2025, according to Yardi Matrix’s Winter Multifamily National Report. While rents are set to rise moderately, sales activity is likely to remain subdued amid ongoing economic challenges.

Yardi Matrix forecasts a 1.5% national increase in multifamily advertised rents in 2025, driven by sustained demand in regions like the Northeast and Midwest, where supply growth is constrained. However, the pace of rent increases continues to slow significantly from the post-pandemic boom.

Between 2021 and 2022, multifamily rents soared by a combined 21.4%, fueled by surging demand. By contrast, rent growth in 2023 and 2024 totaled just 1.9%, with 2024 alone posting a modest 1.0% rise.

Affordability Challenges Bolster Demand

Key factors sustaining demand for multifamily housing include limited affordability in the for-sale housing market. Elevated 30-year mortgage rates, which peaked at 7.4% in late 2023 before settling in the mid-6% range by December 2024, continue to place homeownership out of reach for many Americans.

Despite the Federal Reserve’s interest rate cuts in the fall of 2024, the average rent of $1,783 in the third quarter remains far below the typical mortgage payment of $2,416. This disparity keeps would-be buyers renting longer, further underpinning demand in the multifamily sector.

Construction Slowdown on the Horizon

Although 2025 will see significant new multifamily deliveries, the pipeline is beginning to tighten. After a record 550,000 units came online in 2024, the report anticipates a slight decline to 508,000 units in 2025, adding 3.0% to the total U.S. stock.

Markets expected to see the most significant increases in stock include Austin (7.3%), Charlotte (6.2%), and Nashville and Phoenix (both 6.1%). Other fast-growing metros like Raleigh-Durham (5.4%), Denver (4.9%), and Miami (4.2%) will also see notable expansions.

The largest absolute delivery volumes in 2024 were concentrated in Dallas-Fort Worth (32,600 units), Phoenix (23,200), and Austin (23,100), with similarly high levels expected in these markets for 2025.

However, as construction starts slowed during the latter half of 2024, the report anticipates a more pronounced decline in new multifamily deliveries in 2026 and 2027.

Sales Activity Remains Tepid

The multifamily sales market has struggled to regain momentum, despite a brief surge when interest rates dipped. Through October 2024, $62.7 billion in multifamily properties changed hands, mirroring the previous year’s volume.

Rising rates and uncertainty about future income growth are expected to keep transaction activity muted in 2025. Investors remain cautious as another 500,000 units are delivered before the impacts of slowing starts become apparent.

Lee & Associates Dallas-Fort Worth completed a new lease transaction for a 91,520-square-foot industrial space at Prologis Park 35, 12301 Stemmons Freeway in Farmers Branch, Texas.

Ally Tanghongs and George Tanghongs of Lee & Associates Dallas-Fort Worth represented the Tenant, E-Future Logistics, Inc.

Steve Berger of CBRE Inc. Dallas represented the Landlord, Prologis.

Denholtz Properties has signed a 31,760-square-foot lease with OTC Industrial Technologies at Clovis Crossing, a newly-constructed, two-building, 213,125-square-foot industrial property at 1603 Clovis R Barker Road in San Marcos, Texas.

Acquired by Denholtz Properties in early 2024 as a key piece of its continued national expansion, Clovis Crossing is located on a 13-acre site approximately 30 miles from both Austin and San Antonio. Both of the brand-new Class-A, shallow-bay industrial buildings boast 32’ clear ceiling heights and rear load configurations making them ideally suited for a wide range of tenants.

Headquartered in Columbus, Ohio, OTC Industrial Technologies is a one-stop supplier of comprehensive industrial and manufacturing solutions. With over 60 locations across 40 states, the company offers products from more than 40 leading brands. Its lease at Clovis Crossing will support the expansion of OTC Industrial Technologies’ growing filtration division. As one of the largest filter suppliers in the industry, the company will use the space for warehousing and distribution of its extensive range of HVAC filters, liquid filters, and filter media to customers nationwide.

Denholtz Properties’ acquisition of Clovis Crossing highlights the continued expansion of its national industrial portfolio. Earlier in 2024, the firm also acquired the Lehigh Valley Portfolio, an 18-building, 723,734-square-foot flex/industrial portfolio spread across Allentown and Bethlehem. Over the past several years, Denholtz Properties also entered the Savannah, Ga. market with the acquisition of the three-building, 358,884-square-foot Coleman Industrial Portfolio and acquired two industrial assets to grow its presence in North Carolina – 9201 Forsyth Drive, a 53,811 square-foot industrial property in Charlotte and Interstate Commerce Park, a five-building, 218,570-square-foot industrial portfolio in Greensboro. 

Transwestern’s Carter Thurmond, Nash Frisbie and Bailey Sousa represented Denholtz Properties and Colliers’ Shane Woloshan, Nolan Babb, Travis Hicks, Chase Clancy and Michael Modesett represented OTC Industrial Technologies in the transaction.

181,365 square feet of industrial space is currently available at Clovis Crossing. 

Kansas City recorded the lowest industrial vacancy rate across the country in November at just 3.3%, according to the latest numbers from CommercialEdge.

That’s significantly lower than the national industrial vacancy rate of 7.5% during the same month, according to the December national industrial report released earlier this month by CommercialEdge.

Overall, CommercialEdge reported that 2024 represented more of a normal year for the U.S. industrial market following the surge of activity during the height of the COVID-19 pandemic.

According to CommercialEdge, this year has been defined by a normalization in demand, slower development and steady sales prices.

Year-to-date, 330.7 million square feet of industrial space has been delivered in the United States, while new construction starts totaled just 207.8 million square feet, a significant drop from recent years.

Industrial sales volume as of the end of November hit $54.6 billion, a figure that is on track to match the totals this industry saw in 2023.

And in good news for the sector, the average sales price for industrial assets through November grew 2.7% when compared to the same period a year earlier, reaching $128 a square foot.

Industrial Outdoor Ventures completed the acquisition of adjacent industrial outdoor storage assets on Hightower Drive in Garland, Texas, northeast of Dallas.

IOV now operates seven IOS and truck parking assets in the Dallas marketplace.

Combined, the newly acquired properties total 5.74 acres with almost 26,000 square feet of buildings. The properties are available for lease to a single user or individually.  The owner of the property was a national transportation and logistics firm.

The larger of the two properties, located at 2210 Hightower Drive, is a 3.57-acre asset with an 18,564-square-foot building. The concrete yard area can accommodate parking for 56 trailers. The building, which can be utilized for warehouse and/or maintenance, features 20’ clear ceilings and six grade-level drive-in doors.

The second property, located at 2130 Hightower Drive, is a 2.17-acre facility, with a 7,368 square foot building. The concrete yard area can accommodate parking for 25 trailers. The drive-through service building is 70’ deep with eight 14’ drive-in doors.

In the aggregate, IOV operates seven DFW assets totaling 72.7 acres with approximately 100,000 square feet of buildings for storage, maintenance and complementary uses.