As rental prices soar some North Texas developers are thinking small, really small

Imagine living in a 350-square-foot pad just minutes away from downtown Dallas.

“Yeah, people get a little bit of sticker shock when they hear 350 square feet,” Alex Lowe said. Lowe works with the Dallas-based real estate company, Madison Partners.

Madison Partners recently purchased a 1.3-acre lot on the corner of Carroll Ave and Willow Street that will be home to the micro-unit community, The Bloc House.

"We have lots of wonderful partners that we're working with on the design to make sure that the space is well designed, that people can get as efficient as possible with how they're utilizing the space.”

The 70-plus unit property will offer two-bedroom options and some of the micro-studio units will be fully furnished with a wall bed.

“One of the key components of that design is our partnership with Ori Living, which is a modular furniture company out of New York," Lowe said. "Because of that, at first it sounds like 350 square feet, but more effectively, it's around 440 square feet with how to spot the spaces multifaceted."

Lowe and Jon Hetzel are thinking small to meet the demand following the wave of growth the City of Dallas has seen in the last few years.

“We're focused on what's called the missing middle, which is the space between single-family homes and large multifamily building,” Lowe said.

They received the green light from the City Plan Commission with a unanimous zoning approval in January.

"Dallas has seen, you know, near record-breaking rental rate growth due to all of the demographic changes, people moving to the market, increased jobs, increased salaries," Hetzel said. "Most of all new construction is targeted towards the class A, high-income end of the spectrum."

According to Rent.com, the average rent for apartments in Dallas is between $1,349 to $1,984. The new construction aims to be at or below average rent.

“It's really, really hard for somebody just starting their career to find an apartment in Dallas proper that is well done up to code, nicely furnished at a rate that they can afford,” Hetzels said. “There's not a lot of people focusing on the middle segment of what the renters are looking for, particularly younger renters that are moving to the market for jobs.”

While the concept is not for everyone, the developers said there is a market for small spaces that don’t compromise amenities including walking trails, restaurants, and proximity to downtown Dallas.

"We want them to be close to their job, close to their favorite coffee shop, close to the place where they work. And the way to do that is providing them with a place where they can afford to live," Lowe said.

The property is located directly across the Santa Fe Trail.

"The trail itself is the primary amenity," Hetzel said. "And so, we're exploring a variety of things like apartment bikes that are loaners so people can use the trail, pool, some ability for coworking and fitness and community gathering."

Construction is set to begin in 2024.

According to Madison Partners, this is just the start of the micro-unit concept as they're already in negotiation for other sites throughout North Texas.