New market analysis reveals a surprising convergence in multifamily permitting across top-tier cities, offering insights into the evolving landscape of commercial development.
Multifamily Permitting Levels Reach Similar Ground in Major Cities
This Market Analysis explores the latest U.S. Census data highlighting how four key U.S. metros—Austin, Orlando, Phoenix, and Atlanta—have converged in multifamily permitting activity, each reporting annual permit totals between 11,400 and 12,300 units for the year ending April 2025.
Despite achieving similar volumes, these cities are on divergent paths. Orlando surged ahead, adding 4,351 more permitted units compared to last year. In contrast:
- Austin declined by 7,910 units
- Phoenix dropped 5,891 units
- Atlanta saw a 3,088-unit pullback
This alignment in permitting volume—despite stark year-over-year (YoY) changes—underscores shifting developer sentiment and market recalibration post-pandemic.
Permitting Momentum Shifts Across U.S. Metros
Cities Losing Ground
Several once-booming markets are seeing permitting slowdowns:
- Los Angeles and Washington, DC each recorded 4,000–4,500 fewer multifamily units YoY.
- Miami, now ranked #16 nationally, fell over 3,000 units.
- Tampa mirrored Miami’s decline with a similarly steep drop.
These decreases suggest developers may be recalibrating amid rising construction costs, changing migration patterns, and regulatory challenges.
Markets with Modest Gains
Not all metros followed the downtrend:
- New York, Dallas, and Houston reported modest increases in permitting.
- Columbus, OH, stood out with a nearly 22% YoY jump, signaling Midwest momentum.
CBRE’s recent research supports this regional shift, noting increased investor interest in secondary and tertiary markets as cap rates stabilize and rental growth moderates in core cities.
Smaller Cities Emerge as Development Hotspots
In a surprising turn, smaller and mid-sized markets saw significant upticks in permitting:
- Chicago and Anaheim led the way among larger second-tier cities.
- Fayetteville, Omaha, Des Moines, and Augusta each gained between 1,200 and 2,200 multifamily units YoY.
These gains indicate a broadening development footprint, with builders seeking out more affordable land, less red tape, and high demand in under-supplied regions.
Case in Point: Orlando’s Rise vs. Austin’s Decline
Orlando’s sharp 4,351-unit increase in permits reflects strong population inflow, job growth, and a business-friendly regulatory environment. Developers are capitalizing on demand in both suburban and urban nodes.
In contrast, Austin’s steep decline (-7,910 units) could reflect:
- A cooling demand post-pandemic boom
- Stricter entitlement processes
- Developer fatigue after years of rapid expansion
For a deeper look at how permitting fluctuations affect development cycles, explore our recent post on Why Development Timelines Are Expanding in U.S. Cities.
Looking Ahead: What Multifamily Permitting Signals for CRE
Permitting trends are often a leading indicator of future supply and investor sentiment. With rising interest rates and cost pressures, developers are becoming more strategic:
- Focusing on high-demand, low-barrier markets
- Prioritizing build-to-rent and workforce housing
- Diversifying away from oversaturated metros
Expect continued growth in emerging cities as developers chase yield and stability in a maturing cycle.
