Almost 40 percent of Dallas-area residents are renters.
For most of those folks, that means apartments.
But a new development trend is offering another option to local residents who want to rent the roofs over their heads. Arizona-based developer NexMetro Communities is building the second of what it hopes will be several communities that provide renters small single-family homes.
The Avilla Northside development in McKinney and the already-open Avilla Premier project in Plano each have more than 100 homes, a swimming pool and outdoor spaces in gated communities.
“You get the privacy of the single-family lifestyle with the maintenance and services you’d expect from an apartment project,” said NexMetro’s vice president Ryan Griffis. “The privacy is probably the number one aspect of why renters choose to live here.”
The brick and stone homes each have a small backyard and range in size from about 650 square feet for a 1-bedroom unit to 1,300 square feet for the largest 3-bedroom. The houses rent from less than $1,400 to just over $2,000 a month, depending on size and location.
Griffis said about 50 percent of his firm’s renters were previously homeowners. “We are drawing pre-seniors and empty nesters,” he said. “We are drawing young professionals who have animals and are looking for privacy.”
Griffis said his firm’s renters stay longer than tenants in traditional apartments — more than two years on average.
NexMetro’s Plano community, which has 120 units, opened late last summer and is more than 90 percent leased. The McKinney project on White Avenue west off U.S. Highway 75 will have its first units ready in the middle of May.
“We started leasing just this past week,” Griffis said. “We’ve had hundreds of phone calls showing interest.”
Traci Coons, who lives in the Avilla Premier community in Plano, said she didn’t know what to expect before touring the property.
“I had never heard of it and was hesitant until I looked at it,” Coons said. “We saw several apartments before we saw this on the website.
“I couldn’t believe it,” she said. “I thought, ‘why doesn’t everybody do this?’ It feels like a home.”
Coons said she and her family moved to the property after she got a new job in the area.
“My kids call it the cottage,” she said. “There is nobody above you or below you, and it’s very, very quiet. I have a dog, and we have a little backyard and a front porch,” Coons said.
NexMetro said it designs the bijou homes in styles that mimic traditional single-family neighborhoods in the area.
Its projects in Arizona are flat-roofed with stucco and stone exteriors and cactus in the yard. In North Texas, the houses are craftsman style with wood, red brick and Austin stone exteriors.
“We are working hard with our design team on what the Texas style is,” Griffis said. “I think you will see some different iterations in our other projects in the area.”
NexMetro is already planning a third local project in Grand Prairie that will have 140 homes. And the developer is buying a property north of Fort Worth for a 200-home community.
“The goal for the next year is about 450 homes” in this area, Griffis said. “We’d like to get to about 600 homes a year after that.”
NexMetro is also building in the Denver area and exploring locations in Florida.
Late last year, NexMetro inked a deal with investor Trez Capital to develop five more communities valued at more than $100 million in Denver, Phoenix and Dallas.
Room in the market
The Arizona builder isn’t the only company in this field.
Lewisville’s Castle Hills development is adding a community of 72 rental homes. Called the Cottages at the Realm, homes in the development will rent for $2,736 a month and up and range from 1,844 to 2,777 square feet.
And apartment developer Greystar is building about a dozen single-family rental homes as part of its new apartment community in North Dallas at Inwood Road and Forest Lane.
“This is something that a lot of different companies are exploring on a small scale,” said Greg Willett, top economist with Richardson-based RealPage. “There is certainly room in the market for this, but it’s not going to become the dominant rental option.
“Millennials are getting older and having kids and they need more space but aren’t necessarily ready to buy,” Willett said. “We’ve seen a run-up in single-family rental demand in this cycle.”
NexMetro’s local construction manager Patrick Bette with BBL Building Co. came out of the apartment building industry to work on the single-family rental projects. He said that home communities can take years to complete, but these projects are done in 18 or 19 months.
With granite countertops, wood-look floors and stainless steel appliances, the rental houses have oversized showers, walk-in closets and 10-foot ceilings.
“It looks similar to a home community down the road,” Bette said.