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Population Growth Driving Multifamily Development in Northwest Arkansas

CoStar Market Insights: Region Recently Ranked 22nd on List of Fastest-Growing Metropolitan Areas According to U.S. Census Bureau
August 6, 2018
Northwest Arkansas’ plentiful job opportunities and low cost of living have translated into swelling population growth this cycle. The U.S. Census Bureau reported that the area ranked 22nd on a list of the fastest-growing metropolitan areas in the country.

Although Northwest Arkansas is not ranked among the 100 largest Metropolitan Statistical Areas (MSA), the region's population growth rate in the past year exceeded the growth rates for 96 of the nation’s top MSAs -- and spurred developers to build the largest supply of apartment units in the Northwest Arkansas area in more than a decade.

Last year, the market saw close to 2,000 new apartment units deliver. While approximately 600 units are expected to be completed in 2018, an additional 2,000 are on track to deliver in 2019.

As of August, just shy of 3,000 units were under construction in Northwest Arkansas. This is double the amount of under-construction units in Oklahoma City (1,521 units) and four times the amount of new apartments under construction in Tulsa (533 units). Construction activity also exceeds larger markets like Madison, Wisconsin, Durham, North Carolina and Pittsburgh.

CoStar is reporting an additional 1,270 proposed units that could begin construction in the next year, (with a construction timeline that would put them in line for a 2020 completion), and the probability of even more development passing proposals and getting underway quickly is high.

Similar to most metropolitan areas across the country, development is focused in the downtown areas, encompassing the live-work-play dynamic popularized by developers. The lion’s share of the new inventory consists of high-end 4- and 5-Star buildings replete with such amenities as pet play areas, clubhouses and fitness centers.

The area has benefited from a strong local economy and a growing, well-educated labor force fueled by the University of Arkansas. Also, Northwest Arkansas is home to three Fortune 500 companies -- Walmart, Tyson Foods and J.B. Hunt -- as well as numerous ancillary companies that have operations in the area. These companies have contributed to the creation of more than 15,000 new jobs over the past two years and lowering the market’s unemployment rate to below 3 percent.

The employment opportunities have attracted more people to the area, with an average of about 28 new residents arriving in northwest Arkansas every day, per the U.S. Census Bureau.


CoStar Market Insights provides a snapshot of recent real estate trends. The CoStar Market Analytics team monitors commercial and multifamily real estate across 390 metro areas, with a granular understanding of the projects, players and economic trends that move these markets.

Learn how CoStar Market Analytics can add to your market knowledge, helping to minimize risk and maximize returns.
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