Placing in the #9 spot on our list, The Nation’s 10 Busiest Submarkets for Apartment Construction, is Far Northwest San Antonio in metro San Antonio. Far Northwest San Antonio’s apartment inventory expansion rate from 2012 to 1st quarter 2016, including new apartment supply plus units under construction at the end of 1st quarter 2016, was 64.6%. Far Northwest San Antonio has received 4,253 new units since 2012, with another 2,157 units under construction at the end of 1st quarter 2016. Similar to most submarkets on our list, location and ease of access to some of the metro’s top employers is a key component of what makes this area of San Antonio so hot for apartment development. Additionally, high median household income primes this submarket for high-end apartment development centered around popular shopping destinations and master-planned communities.
That is just a taste of what is driving the market. Let’s dive in and see more of what makes Far Northwest San Antonio such a prime candidate for apartment development.
Far Northwest San Antonio is located within the San Antonio metro. The Far Northwest San Antonio submarket is located in the rolling plains of the gorgeous Texas Hill Country and is one of the higher-end areas of San Antonio. Whereas many of the high-development submarkets on this year’s list are centered around various neighborhoods, Far Northwest San Antonio is heavily centered around master-planned communities. The submarket is home to well-known master-planned communities such as The Dominion, Stonewall Ranch and Cresta Bella, to name a few.
Similar to Cedar Park and other strong performers on our list, the northern portion of the submarket is primarily residential, housing a number of San Antonio’s commuters, while the southern portion contains multiple Fortune 500 employers. The intersection of Loop 1604 and I-10, in the southern portion of the submarket where most of the apartment development is occurring, provides easy accessibility to the rest of the San Antonio metro.
Ease of Access to Major Employment Hubs
San Antonio is quickly growing northward, and Far Northwest San Antonio is a recipient of much of that growth. The submarket contains two important roadways: Loop 1604 and I-10, which intersect in the southern part of the submarket. That intersection is a hotbed for apartment development, as well as retail and office space. Spurring recent development are a few major employers located nearby:
- Valero. A Fortune 500 company that is an international producer of transportation fuels and petrochemical products. Valero employees approximately 1,653 San Antonians, according to San Antonio Economic Development Foundation. Valero is headquartered on a 200-acre campus near the intersection of Loop 1604 and I-10.
- NuStar Energy. A Fortune 1000 company that has 8,643 miles of pipeline and 82 terminal/storage facilities that keep and allocate crude oil, refined products and specialty liquids. The company employees around 1,200 people, with 550 of them at the company’s headquarters in Far Northwest San Antonio. The company ranked #4 in Fortune’s Top 10 Places to Work in Texas in and ranked #19 nationally in their 2016 ranking of Best Companies to Work For.
- Medtronic. This Fortune 500 company is a medical device maker that is headquartered in Minneapolis. It opened a unit in Far Northwest San Antonio focused on providing technology, service and support to assist people with diabetes manage glucose levels. The company’s San Antonio unit has a workforce of roughly 1,100 people.
- Security Service Federal Credit Union. This credit union’s headquarters in the Far Northwest San Antonio submarket employs around 1,200 individuals in the San Antonio metro.
- Harland Clarke. Harland Clarke serves 12,500 financial and commercial clients and employs over 3,700 employees across the nation. They are headquartered in Far Northwest San Antonio and employ around 1,500 locals.
- USAA. Though USAA is not technically located within the Far Northwest San Antonio submarket, its regional headquarters are less than a mile south of the submarket, on I-10. USAA is a Fortune 500 company and is the largest private employer in the San Antonio region. It serves members of the military and their families with several options of insurance, banking, investment and financial service products. The company employs roughly 17,000 people. The company ranked #6 in Fortune’s Top 10 Places to Work in Texas in 2016 and ranked #36 nationally in their 2016 ranking of 100 Best Companies to Work For.
In addition to the number of major employers near the intersection of Loop 1604 and I-10, the I-10 highway goes straight into Central San Antonio, making it easy for Far Northwest San Antonio’s residents to get downtown, just 11 miles away. With so many major employers in the area – not to mention great access to other San Antonio employment hubs – it is no wonder that apartment construction has blown up in the submarket.
Retail & Entertainment
Far Northwest San Antonio is quickly becoming a retail and entertainment hub of San Antonio. Let’s take a quick look at some of the retail outlets and entertainment venues within the submarket helping to drive demand for living in the area, all of which are located around the Loop 1604 and I-10 intersection:
- Six Flags Fiesta Texas. This theme park, located on the west side of I-10, just north of Loop 1604, employs some 3,000 people.
- The Rim. The Rim is the largest outdoor retail center in Texas, clocking in with over 2 million square feet of outdoor retail space. The Rim recently completed a fifth phase of construction that now hosts businesses including Hobby Lobby, PetSmart and Hemispheres. Additional expansions have been completed since, with even more anticipated to come about in the future. The Rim is located off I-10, just north of Loop 1604. With over 100 retailers, restaurants and business services, The Rim is a huge attraction for tourists and locals alike. The property is also home to a boutique hotel and residences.
- The Dominion Country Club. The Dominion Country Club is a private country club in the Far Northwest submarket in San Antonio. It boasts a world-class golf course that was home to a Senior PGA tour for 17 consecutive years, distinguishing The Dominion as the longest consecutive host of a Senior Tour event. The club also boasts a 54,000-square-foot clubhouse, various dining options, a spa, a tennis center and pristine courtyards.
- Top Golf. Top Golf, a golf experience that combines golf with entertainment, is located just south of The Rim, on the east side of I-10. The facility opened in late January 2015.
- La Cantera. La Cantera is a roughly 1,700-acre master-planned community situated in Far Northwest San Antonio. It contains a variety of attractions in addition to its strong residential presence. It contains several attractions. The Shops at La Cantera is an upscale, open-air shopping center sits on 150 acres in La Cantera and offers roughly 200 shops and restaurants located within the shopping center. Dillard’s, Macy’s, Neiman-Marcus and Nordstrom department stores anchor the center’s directory. La Cantera Resort & Spa is also within the La Cantera community. The resort also features two elite golf courses: The Resort Course at La Cantera and The Palmer Course at La Cantera. Loma de Vida Spa & Wellness is a new addition to La Cantera Resort & Spa and will open in Spring 2016. The addition is sure to bring even more attention to the exclusive destination.
Universities and Student Housing
Another big apartment demand driver in the Far Northwest San Antonio submarket is the University of Texas at San Antonio (UTSA). As of the Spring 2016, there were 22,632 undergraduate students and another 3,905 students enrolled in graduate and doctoral programs, according to the university’s preliminary count. There also was a 1.8% increase in undergraduate enrollment in Spring 2016 over Spring 2015. While some on-campus housing is available, most students live off campus.
For student housing, 172 apartment units completed in the submarket within the past year in a community dubbed Prado, developed by Fountain Residential Partners. Demand for off-campus housing prompted the sale of Tetro Student Village, a fully-occupied 198-unit property, to a private investor for an estimated $27 million.
Development is highly concentrated around the Loop 1604 and I-10 intersection, where most of the shopping and area’s attractions are also clustered. The vast majority of the submarket’s completions have been Class A product loaded with amenities. Far Northwest San Antonio’s development also tended to be diverse in terms of unit count. Unit count ranged from 116 units through 623 units (for combined-phase projects) and the average property size was roughly 320 units.
Many projects are clustered around retail and entertainment options in the submarkets. For example, in the La Centera area, the first phase of The Residences at La Cantera, a 323-unit conventional apartment complex, was completed in 2013. Naturally, this apartment community has all the bells and whistles from expansive walk-in closets and soaking tubs to a yoga classroom and membership access to the La Cantera Hill Country Resort’s spa and golf course. The property was developed under a joint venture between USAA Real Estate Company and Cambridge Development Group. A second phase of the complex is currently under construction and is scheduled to complete in late 2016. The addition will add another 300 units.
Others are clustered around The Rim retail center:
- Aura at the Rim, scheduled to complete in 2nd quarter 2016, boasts 308 luxury units ranging in price from around $1,000 to $2,000. The property features amenities like a fitness center, spin room and resort-style pool, and is surrounded by premier shopping and restaurants. Trinsic Residential Group was the developer of this complex.
- Lynd Development Partners recently began construction on a 380-unit luxury apartment complex, Lynd @ The Rim. The apartments feature modern design and luxury amenities. The complex will include at least 52 retail stores, 32 restaurants, an IMAX and more! The apartment project is anticipated to cost $42 million and should complete in 3rd quarter 2017.
- Luxe Villas at The Rim are also under construction and are anticipated to complete in 4th quarter 2017. The complex will feature 427 Class A+ apartments. The community includes luxury amenities such as a variety of outdoor courts (pickle ball, tennis, sand volleyball, bocce ball and more) as well as three pools, a social pavilion, play area and a dog park with a fountain. The indoor amenities are even more abundant and resemble that of a spa or resort. The Frankel Family Trust and Legacy Alliance are working together on this community.
There a couple of other noteworthy apartment projects in Far Northwest San Antonio:
- Grand at the Dominion is located in the prestigious Dominion neighborhood east of I-10 consists of 320 Class A units. The property boasts amenities such a clubhouse with an indoor golf simulator, fitness center, yoga studio and billiard room.
- Ventura Ridge is a trendy apartment complex boasting the best Hill Country views in town. The complex, developed by The Carbon Companies, was built with the environment in mind. The property has a variety of eco-friendly and lifestyle features. The 336-unit project was completed in November 2015, completing in 16 months. Phase two of the project will add an additional 156 units and is set to complete later in 2016.
- Developers Koontz Corp completed Savannah Oaks, a 332-unit Class A apartment complex, in January 2016. The gated property boasts spacious floorplans ranging from 700 to 1,244 square feet.
This submarket is bursting with retail and entertainment options to satisfy any resident. Such attractions combined with easy access to countless employment opportunities has pushed development of luxury properties through this cycle. Apartment development seems to be following the area’s expanding retail areas and master-planned communities. While the submarket saw significant development from 2012 through 1st quarter 2016, development has seemed to slow more than other submarkets, which should provide time for properties to lease new supply. The economy is diverse and built upon steady economic drivers that should provide properties with consistent growth.