Dallas-Fort Worth– Come for the Steaks, Stay for the Multifamily

by Carl Pankratz

Have you heard that Texas changed its state bird?  It’s now the construction crane.  OK, it’s an old joke, but the fact is that the Texas Economy is booming. You can see the signs not only in new buildings but in job growth, too. Employers have come in droves seeking the low tax, business-friendly regulatory environment found in Texas. This boom in job growth naturally leads to an increased demand for value-add multifamily real estate, making it an exciting time to invest.

As of September 26, 2019, the unemployment rate remains at the historic low of 3.4 percent. The State saw job gains of 3.0 percent in August and 1.8 percent in July. Unlike other economic booms fueled by speculation, this economy is fueled by true job growth.  Even more remarkable is the fact that the growth is in spite of a cool down in the energy sector.  Energy saw jobs decline at an annualized rate of 1.6% year to date and 7.3% over the past two months. With a pickup in energy prices, Texas could have even more room to grow! Moving forward, the Dallas Federal Reserve forecasts, “The outlook for the Texas economy remains positive, and the employment forecast still calls for above-trend growth through year-end.”

The Dallas-Fort Worth Region is fueling the boom.  In September, the unemployment rate fell to 3.1% in Dallas and 3.2% in Fort Worth. Both are better than the state average. Office space saw an increase in the construction pipeline of 5.4 million square feet in the third quarter, with vacancy ticking down and rents ticking up. In the industrial sector, the product type has seen a net absorption of 15.9 million square feet over the first nine months of 2019, pushing vacancy to 5.6%, well below the historical average per the Dallas Federal Reserve Bank. Both industries are indicators of jobs and companies coming to the region. For anyone that hasn’t been to Dallas-Fort Worth in the last five years, the landscape would look fundamentally different. Frisco, formerly a small suburb, is now home to the PGA Headquarters. Richardson is home to State Farm. Charles Schwab, Liberty Mutual, Toyota, TD Ameritrade, and Uber now call the region their home, as well.

The low tax and low regulatory environment make Texas an attractive place to do business.  In California, Governor Gavin Newsom signed a rent control law that will reduce the amount of rent allowable for an apartment owner to charge. New York and Oregon have quickly followed suit, with other states considering other measures. From an investment standpoint, the ramifications could be disastrous. When investors buy apartment properties, they typically do so on three to five-year projections called Pro Formas. Pro Formas are an investor’s budget/forecast, determining where they can: push rents, achieve additional income, and how they can reduce expenses. More importantly, these pro formas determine the quality of a potential investment, including determining how well investors can expect to profit.

Think about everyone that invested in these states based on the ability to raise rents, only to have that ability taken away. Think about other regulations that can have similar effects and how it affects your choices as an investor. It can fundamentally impact your returns. Contrast that with Texas! There is currently a ballot measure to make it more difficult for the State to ever allow income tax to be levied on the future. The State Legislature only meets every two years. The climate of personal responsibility and self-reliance promotes an environment that rewards achievement. As an investor, Texas provides stability. As other states push anti-business measures, Texas focuses on how it can be more business friendly. This respect for business, leads to a better place to invest.

New residents following this job growth from other parts of the country, or current Texans benefitting from it, create exciting opportunities for multifamily investment. According to University of North Texas Economist John Baen, the US will need 4.6 million new units by 2030, and Dallas-Fort Worth alone will need at least 475,000 units. Higher student loan debt, low wage growth in relation to inflation, and several other socio-economic factors push many of these new Texas Residents to become renters. Complicating matters are the headwinds that affect the ability to build more units. Construction costs continue to rise, finding suitable labor will remain a challenge, and cities will restrict zoning to prohibit the amount of growth. All these validate the current investment opportunities in value-add multifamily. As these properties are already on the ground, in areas that likely prevent future buildout, with rents lower than what is required for newly built properties, value-add multifamily real estate continues to hold a promising future. Unlike retail, industrial, or office, multifamily is unique given its that it provides for a basic human need, a place to live. All these factors prove the potential Dallas Fort Worth Multifamily provides investors looking for exciting investment opportunities.

Texas is booming. Dallas-Fort Worth is booming. For investors looking for a place to investment, Dallas-Fort Worth proves very exciting.



Lisa Harris

Lisa Harris is the Director of Operations for Exponential Property Management. In this capacity, she is responsible for driving property performance, monitoring market performance, and providing leadership oversight to a growing team of regional and property managers. 

Lisa has over three decades of experience in multifamily operations and property management. Prior to joining Exponential Property Management, Lisa served as a Regional Director for W3 Luxury Living. In this capacity, she provided directional leadership supporting the businesses property management efforts. She has also held significant regional leadership roles with Monogram Residential Trust, Behringer Harvard, and Lincoln Property Company. 

Lisa studied Advertising and Public Relations at Texas Christian University. She is also a Certified Apartment Manager via the National Apartment Association, as well as a Certified Property Manager via the Institute of Real Estate Management. Lisa is an active member of the Apartment Association of Greater Dallas. 


Stan DeMille

Stan DeMille is the Director of Construction and Development for Exponential Property Group. In this capacity, he provides strategic leadership and direct oversight to the construction aspects of the firm’s ground-up development and value-add renovation projects.

Stan has nearly three decades of architectural and construction management experience. Prior to joining Exponential Property Group, Stan was a Senior Project Manager for Jones Lange LaSalle where he was directly responsible for managing the ground-up development and redevelopment of Chick-fil-A’s throughout the Southwest. In this capacity, he handled all aspects of development from managing relationships with municipalities, architects, civil engineers, and vendors to ensure timely project completion. He also held various construction and development leadership roles with Bar Louie Restaurants, Lact Call Operating, and Consolidated Development Services. 

Stan holds his Bachelors of Science in Architecture from the University of Texas at Arlington. Stan spends most of his free time with his wife and twin boys. He is actively involved in his sons’ extracurricular activities including theater, rock climbing, and baseball.


Sterling Worth

Sterling Worth is the Vice President of Finance and Acquisitions for Exponential Property Group. In this capacity, Sterling leads all investment sourcing and analysis efforts for the firm, as well as debt and equity raising, and asset management. 

Sterling has nearly two decades of institutional commercial real estate investment experience where he has a multi-billion dollar track record of successful capital placement spanning all commercial real estate asset classes. Before joining Exponential, he spent over a decade with Invesco Real Estate, and several years with Clarion Partners.

Sterling holds his Bachelors of Business Administration from Texas A&M University. Most of his free time is spent with his wife Natalie, his daughter Lily, and son Turner. 


Francis Murphy

Francis Murphy is the Director of Operations for Exist Multifamily. In this capacity, he leads a team of operations, sales, and business development professionals for the materials and graphics businesses, respectively. 

Prior to joining Exist Multifamily, Francis owned and operated a Junior Soccer Club in the United Kingdom. His passion for teamwork, development, sports, and giving back to the community fueled his leadership and propelled his success for over a decade in the profession. Prior to this, Francis was an Operations Manager for one of the United Kingdom’s largest pharmaceutical companies where he managed a large team of professionals and maintained direct responsibility for all supply chain operations. 

When Francis isn’t building the materials and graphics businesses at Exist, you can find him spending time making close friends laugh over a competitive game of Texas Hold’em Poker or traveling. 


Amanda Schwarz

Amanda Schwarz is the Director of Investor Services for Exponential Property Group. In this capacity, she oversees all aspects of capital raises, investor communications, and database management for our Investor Services team.

Prior to joining Exponential, Amanda spent over two decades in various client and office management capacities. She brings extensive management and interpersonal skills alongside her multifamily real estate experience, making her uniquely qualified to lead in her current role. 

Amanda holds a Bachelor’s degree from the University of Illinois. When she isn’t spending time making sure Exponential investors have a top-tier client experience, she loves spending time with her family. She also enjoys hiking with her husband and traveling.


Heather Goodell

Heather Goodell is the Chief Financial Officer for Exponential Property Group and it’s affiliated companies. In this capacity, she is responsible for leading and growing a team that oversees all Accounting and Financial statement reporting, Federal and State tax reporting, Treasury Management services and other supporting areas for the firm’s various lines of business.

Prior to joining Exponential, Heather served as CFO for RealManage where she supported all Finance and Accounting activities, including deep involvement with middle-market M&A activity for the firm.

Heather is a licensed CPA and holds her Masters of Accountancy from Auburn University Harbert College of Business as well as her Bachelors of Business Administration from Florida Atlantic University. She loves to spend her free time with her family, friends, and reading a good book.


Natasha Austin

Natasha Austin is the Chief Operating Officer for Exponential Property Group and Exponential Property Management. In this capacity, she acts as the strategic leader over all property management operations and value-add renovation strategy for the company. 

Natasha has deep domain expertise having spent over two decades in multifamily property management and operations. Prior to joining Exponential Property Group as the Director of Operation in 2015, she led property management efforts in various capacities with DD Fire, Pegasus Residential, Guardian Real Estate Services, and United Apartment Group. 

When Natasha is not leading her team of over 100 professionals at Exponential, you can find her with her husband traveling with her kids who are avid baseball players. She also acts as the Executive Director of the Martha’s Ranch Foundation, a 501c3 created to provide a source of fun and support tailored for families with autistic children.


Matthew Bays

Matthew Bays is the Managing Principal and Chief Development Officer for Exponential Property Group as well as the Chief Executive Officer for Exist Multifamily, Exponentials materials and graphics company. Matt oversees the identification and execution of new property development opportunities for the firm, as well as leading and growing the multi-million dollar materials and graphics company.

Prior to joining Exponential in 2017, Matt oversaw all U.S. operations for Renew Sleep Solutions where he led all aspects of operations, business development, new site development, and design/implementation of workflow technologies. He also held senior level roles with Davita, Varsity Shoppe, Iron Mountain, Pinogy Corp, and Dell Corporation. 

Matt holds his MBA from Southern Methodist University Cox School of Business as well as his Bachelors of Science from the University of Texas at Austin. When he is not creating new business ideas, or developing new technology, his efforts are directed towards his role as Chairman of the Board for the Martha’s Ranch Foundation, a 501c3 he created alongside his wife to provide a source of fun and support tailored for families with autistic children. When not working, you can find Matt spending time with his wife Kim, son, Jett, or twin step-sons James and Nathan. Matt is an avid traveler and scuba diver.