Fort Features: 3 Reasons to Invest in San Antonio
FORT FEATURES: 3 REASONS TO INVEST IN SAN ANTONIO
Fort Capital is dedicated to providing exceptional returns to investors and stakeholders. In doing so, we are constantly looking for new opportunities to invest in exceptional, risk-adjusted assets in high-growth markets.
As more investors’ eyes continue to turn to Texas, Fort Capital is seeking opportunities to acquire assets in the San Antonio Industrial Market. Our team sees this as a perfect time to enter this market due to its rapid increase in size. Here are the top 3 reasons why we’re investing in San Antonio right now:
1. The Austin-San Antonio Corridor is one of the fastest-growing regions in the country based on population.
San Antonio is one of many cities booming in the state of Texas with concentrated growth in the area between San Antonio and Austin, known as the Austin-San Antonio Corridor. Currently, with 4.5 million people calling it home, it is expected to grow to 6 to 7 million people by 2030[1].
2. San Antonio’s commercial real estate market has expanded by 16.1% since 2016.
San Antonio has a long history of steady commercial real estate market trends. Inventory has grown 18.2 million square feet to a total of 131.4 million square feet in the last five years[2]. Along with that, the industrial market had over 1.7 million square feet of net absorption in 2021 year to date. Most was entirely warehouse and distribution space[3].
The amount of new development is also growing. San Antonio’s construction pipeline currently has 8.5 million square feet actively under construction. With this, demand continues to surpass construction, causing strong rental growth rates. Overall, net asking rents during Q2 2021 came in at $6.48 per square foot, which is an 8.5% increase from last year[4]. Vacancy decreased between Q1 and Q2 2021, from 13.8% to 12.5%. CBRE reported that this is the most space absorbed in a single quarter since 2013.
3. San Antonio could serve as a manufacturing hub in the coming years.
With Apple building a $5 billion campus and Tesla building their Cybertruck factory, there is no doubt that there is tech growth in Austin. This leaves San Antonio with an opportunity for more growth since experts believe that San Antonio can complement Austin’s large tech industry. This is due to San Antonio becoming a popular light industrial and manufacturing hub that can work with Austin tech companies[5].
As the city has grown, San Antonio has proven to be economically stable. With vacancy rates decreasing and the demand for Class B optionality on the rise, the city will only continue to grow.
Have a deal in the San Antonio market to share with us? Submit it here.