Local market perspective on development opportunities for real estate in the United States in 2026, by city
The ULI and PwC Emerging Trends in Real Estate 2026 survey asked more than 1,700 real estate professionals to rate 81 markets for development prospects on a five-point scale. The combined ratings determine the final ranking. The average score of 2.81 indicates the market is rated as fair but improving. The chart below shows the top 10 ranked markets with their estimated development prospect scores based on publicly disclosed rankings and the confirmed national average. Dallas-Fort Worth leads for the second consecutive year, followed by a strong showing from New York metro markets, Jersey City, Brooklyn, and Manhattan all place in the top 10. For the broader investment context, see our U.S. financial markets analysis.
Top 10 U.S. Markets for Real Estate Development in 2026
U.S. Real Estate Development Prospects 2026 — Key Markets Data Table
| Rank | City / Market | Region | 2025 Rank Change | Top Property Sectors | Key Development Driver |
|---|---|---|---|---|---|
| 1 | Dallas-Fort Worth | Southwest | Held #1 | Industrial, Multifamily, Office | Corporate relocations, diversified economy, population growth |
| 2 | Jersey City | Northeast | New Entry Top 5 | Multifamily, Mixed-Use | Manhattan overflow, transit-oriented waterfront |
| 3 | Miami | Southeast | Stable (within 1) | Hotels, Retail, Office | International capital, wealth migration, Latin America gateway |
| 4 | Brooklyn | Northeast | Up | Residential, Adaptive Reuse | Industrial conversion, life sciences, creative economy |
| 5 | Houston | Southwest | Stable | Industrial, Energy Office | LNG/energy expansion, medical center, port logistics |
| 6 | Nashville | Southeast | Stable | Healthcare RE, Multifamily | Healthcare sector, millennial migration, entertainment |
| 7 | Northern New Jersey | Northeast | Up | Industrial, Data Centers | NY logistics gateway, data center corridor, e-commerce |
| 8 | Tampa-St. Petersburg | Southeast | Stable | Multifamily, Workforce Housing | Florida population growth, affordability vs Miami |
| 9 | Manhattan | Northeast | Up | Office Conversion, Hotels | Flight-to-quality office, residential conversion, life sciences |
| 10 | Phoenix | West | Held #10 | Retail, Industrial | TSMC semiconductor campus, population growth, affordability |
| 11-17 | Raleigh/Durham, Charlotte, Denver, Boston, Austin, Seattle, Washington DC | Various | Mixed | Mixed by market | Technology, healthcare, government, life sciences |
| 18 | Orange County | West | +11 places | Industrial, Apartments | LA overflow, strong industrial demand, lifestyle amenities |
| ~30-40 | San Jose / San Francisco | West | +20 places each | Office, R&D, Data Centers | AI sector boom, tech demand recovery, VC activity |
| ~Top Half | Tallahassee | Southeast | +36 places | Multifamily, Government | State capital, university presence, affordable development costs |
| ~Top Third | Chicago | Midwest | +11 places | Industrial, Multifamily | Industrial revival, data centers, Midwest logistics hub |
| Bottom Half | Cincinnati, Minneapolis | Midwest | Declined | Mixed | Fell from top half to bottom half in 2026 rankings |
Data Centers Lead All Sectors for Third Consecutive Year — Senior Housing #2
The ULI/PwC Emerging Trends 2026 survey identifies data centers as the top-rated property type for both investment and development prospects, with scores above 4.0 on a five-point scale, the only property type to exceed this threshold. Senior housing ranks second, approaching a historic demand inflection as the first baby boomers turn 80 in 2026. The AI-driven buildout of data center infrastructure is covered in depth in our data centers statistics report, and the technology sector driving demand is analyzed in our AI worldwide statistics.
- Data Centers (score above 4.0 — only sector to exceed this): AI infrastructure buildout and cloud computing demand have driven data center investment to record levels. National vacancy is below 2% and most facilities are pre-leased before completion. Power grid constraints and water supply issues are the key development bottlenecks in 2026.
- Senior Housing (score above 3.75): The first baby boomers turn 80 in 2026 — a historic demographic inflection. Record-high occupancy and limited new supply create development urgency across active adult, independent living, assisted living, and memory care subtypes. Developers are incorporating wellness technology and lifestyle programming into new formats.
- Moderate Income / Workforce Housing (score 3.75): Affordability crisis pushes residents toward smaller cities and workforce housing products. Strong investor demand but constrained by construction costs and zoning. Tied with single-family rentals for the third-strongest investment prospects score after data centers and senior housing.
- Industrial / Manufacturing (score 3.72 for manufacturing): Durable demand from consumer spending and reshoring. Manufacturing scored highest of all industrial subsectors at 3.72. Despite some easing in pure e-commerce demand, industrial remains a broadly favored buy recommendation across all subsectors.
- Office — Repricing and Restructuring: Trophy and Class A office commands premium rents as occupiers flight-to-quality. Obsolete Class B and C buildings drive conversion opportunities. The bifurcation between premium and commodity office has rarely been more extreme. Investment score 3.61, development score 3.21, reflecting cautious new development amid repricing.
The ULI/PwC Emerging Trends 2026 report describes the industry as operating in a "fog" of economic uncertainty. The average overall real estate prospects score of 2.81 is improving from 2.75 in 2025 and 2.74 in 2024, but still below the 3.0 threshold that would indicate good conditions. The last time the average exceeded 3.0 was 3.19 in 2022, before interest rate hikes dramatically increased financing costs. Only 55% of survey respondents expect their firm's profitability to be good to excellent in 2026, down from 65% in the prior year. The most successful firms in this environment will be those who combine data-driven market selection with operational excellence in asset management, rather than relying on broad market appreciation. Higher interest rates and financing constraints mean development must be underwritten conservatively with clear demand visibility. The wealth concentration context driving high-end real estate demand is in our U.S. millionaires analysis.
Southeast Leads All Regions at 2.90 — West Lags at 2.68 Despite Tech Recovery
The ULI/PwC Emerging Trends 2026 survey applies a regional framework to compare prospects across five regions. The Southeast has the highest average prospects score at 2.90 and places the most markets in the top 20 overall. The West has the lowest regional average at 2.68, with only Phoenix and Orange County in the top 20 despite 11 of 20 West region markets ranking among the top for per capita income and job growth projections over the next five years. The BlackRock real estate investment context, including their major market allocations, is in our BlackRock real estate holdings analysis.
| Region | Avg. Score | Top 20 Markets | Notable Markets | Key Trend |
|---|---|---|---|---|
| Southeast | 2.90 | Most of any region | Miami #3, Nashville #6, Tampa #8, Tallahassee (+36) | Population growth, corporate relocation, affordability vs. Northeast |
| Northeast | ~2.85 | 4 in top 10 | Jersey City #2, Brooklyn #4, N. New Jersey #7, Manhattan #9 | NY metro development alternatives, industrial gateway, life sciences |
| Southwest | ~2.82 | 2 in top 10 | Dallas-Fort Worth #1, Houston #5 | Energy, tech, no state income tax, corporate relocations |
| Midwest | ~2.75 | Few in top 20 | Chicago (+11), Madison (+26), Cincinnati (declined) | Industrial revival, data centers; some markets falling |
| West | 2.68 | 2 in top 20 | Phoenix #10, Orange County #18, SF/SJ (+20 each) | AI tech recovery in NorCal; high costs still weigh on overall |
| National Avg. | 2.81 | 81 markets total | Up from 2.75 in 2025 | Fair but improving; below 3.0 good threshold since 2022 |
Tallahassee +36, San Jose and San Francisco +20 Each — The Year's Biggest Shifts
Beyond the stable top 10, the most revealing data in any ULI ranking is the movers, markets that significantly changed position. In 2026, Tallahassee moved up 36 places, the biggest gain of any market in the survey, rising from near the bottom of all 81 markets to the top half. San Jose and San Francisco each gained 20+ places, recovering from bottom-third rankings to the middle of the pack, driven by the AI investment wave benefiting Silicon Valley office, R&D, and data center demand. Chicago gained 11 spots, reaching the top third. Orange County gained 11 spots, reaching #18. On the downside, Cincinnati and Minneapolis both fell from top half to bottom half, and multiple Florida markets outside Miami and Tampa declined by more than 10 spots each.
- Tallahassee (+36 places — biggest mover): Florida's state capital moved from near the bottom to the top half of all 81 markets. Lower development costs, university presence (Florida State and FAMU), state government employment stability, and growing healthcare infrastructure make Tallahassee an emerging secondary market play for value-oriented developers.
- San Jose and San Francisco (+20 each): The AI boom has fundamentally changed the Northern California real estate outlook. Technology sector leasing, data center land acquisition, R&D facility expansion, and luxury residential demand tied to AI company compensation packages all improved markedly in 2025-2026. Both markets moved from bottom third to the middle of rankings in a single year — the fastest recovery in recent ULI survey history.
- Chicago (+11): Chicago's industrial market — fed by its position as the nation's largest rail hub and a major logistics crossroads — drove the upward move. Data center investment is also accelerating in northern Illinois. Chicago remains affordable relative to coastal markets and is attracting back-office corporate expansions.
- Cincinnati and Minneapolis (declined sharply): Both markets fell from the top half to the bottom half of all 81 markets. Despite having favorable demographic profiles (young populations, affordable housing), softer job market conditions and reduced corporate expansion in these metros weighed on development appetite among survey respondents.
Frequently Asked Questions — U.S. Real Estate Development Prospects 2026
Dallas-Fort Worth leads U.S. real estate development prospects in 2026 for the second consecutive year, according to ULI/PwC Emerging Trends in Real Estate 2026. It is followed by Jersey City (#2), Miami (#3), Brooklyn (#4), and Houston (#5). The survey reflects the views of more than 1,700 real estate professionals rating 81 markets on a 5-point scale.
Emerging Trends in Real Estate 2026 is the 47th annual industry outlook published jointly by PwC and the Urban Land Institute (ULI), released November 5, 2025. It surveys 1,700+ real estate investors, developers, lenders, and advisors across 81 U.S. and Canadian markets on investment and development prospects, property sector outlooks, and capital market conditions. The average overall score in 2026 is 2.81/5.0.
Data centers rank #1 for development prospects for the third consecutive year, with scores above 4.0 out of 5.0, the only property type to exceed this threshold. Senior housing ranks #2 as the oldest baby boomers turn 80 in 2026, driving historic demand. Moderate-income/workforce housing and single-family rentals tied for third at 3.75. Industrial manufacturing scored 3.72.
Dallas-Fort Worth leads because of its diversified, fast-growing economy (energy, technology, finance, healthcare), business-friendly Texas regulatory environment with no state income tax, lower development costs relative to coastal markets, strong population and job growth, and continued corporate relocations from California and the Northeast. DFW's central location, major infrastructure, and sustained demand across industrial, multifamily, and office property types sustain its top ranking.
Tallahassee moved up 36 places, the largest single-year gain of any market in the 2026 ULI/PwC survey, rising from near the bottom of all 81 markets to the top half. San Jose and San Francisco each gained 20+ places, and Chicago and Orange County each gained 11 spots. The AI technology sector boom drove the Northern California recovery.
The Southeast has the highest average real estate prospects score at 2.90, the most markets in the top 20, and includes top performers Miami (#3), Nashville (#6), and Tampa (#8). The West has the lowest regional average at 2.68, with only Phoenix (#10) and Orange County (#18) in the top 20, despite strong income growth projections in Bay Area markets recovering from prior-year lows.
Cautiously improving but still below historical norms. The average market prospects score of 2.81/5.0 in 2026 is better than 2.75 (2025) and 2.74 (2024), but below the 3.0 "good" threshold last reached in 2022. Only 55% of survey respondents expect good-to-excellent profitability. Higher financing costs, construction cost inflation, and economic uncertainty require conservative underwriting. The best opportunities are in sectors with confirmed demand (data centers, senior housing) and markets with strong fundamentals (DFW, Southeast Sun Belt, NY metro).
San Francisco and San Jose each rose 20+ places in the 2026 ULI rankings driven by the AI technology boom. OpenAI, Anthropic, Google DeepMind, and dozens of AI startups are expanding office and R&D footprints in the Bay Area, reversing the post-pandemic office market decline. Data center land acquisition, high-income residential demand tied to AI compensation packages, and renewed venture capital activity improved overall sentiment significantly for both markets.
Miami ranks #3 overall in ULI/PwC 2026 development and investment prospects. Investor interest is strongest in hotels, retail, and office. Apartment acquisitions are viewed with more caution due to elevated supply. Miami has held within one ranked spot of its 2025 position, showing stable, sustained investor confidence. International capital flows, Latin American wealth management hub status, and continued migration from high-tax northern states underpin development activity.
The most significant declines in 2026 were Cincinnati and Minneapolis/St. Paul, both falling from the top half to the bottom half of all 81 markets. Indianapolis and St. Louis each declined approximately 10 spots. Among Florida markets, Deltona/Daytona Beach, Southwest Florida, and Jacksonville all declined more than 10 places. Despite these declines, all remain viable markets, the rankings reflect relative sentiment shifts among surveyed professionals, not absolute market failure.
Senior housing ranks #2 for development prospects in the ULI/PwC Emerging Trends 2026 survey, just behind data centers. The sector is approaching a historic inflection as the first baby boomers turn 80 in 2026. Record-high occupancy, limited new supply from prior years of underbuilding, and shifting consumer preferences toward wellness-focused and technology-enabled communities are creating strong development urgency across active adult, independent living, assisted living, and memory care segments.
Data centers are the top-ranked property type for both investment and development for the third consecutive year, with scores above 4.0 on a 5-point scale, the only type to exceed this threshold. AI infrastructure buildout and cloud computing demand are driving unprecedented development activity. National vacancy is below 2%, most facilities pre-lease before completion. Key bottlenecks: power grid constraints, water supply, and land in established data center corridors (Northern Virginia, Northern New Jersey, Phoenix). For full data, see our data centers statistics.
The ULI/PwC Emerging Trends methodology surveys real estate investors, developers, lenders, brokers, and advisors, 1,700+ professionals in 2026. Participants rate 81 markets for investment and development prospects across property types on a 5-point scale (1 = very poor to 5 = excellent). They also rate aspects of their local markets. These ratings are combined and calculated to determine overall market rankings. A regional framework groups markets into five regions (Southeast, Northeast, Southwest, Midwest, West) for comparison. Results reflect industry sentiment, not statistical market performance data.