Three months ago I made a few calls on where this market was headed. A couple I felt good about, and one or two I wasn't sure would hold up.

Costs are finally starting to move, podium is still mostly stuck, and a product type I'd more or less written off a year ago is back on our desks. Here's what we're seeing:

Last issue we said costs were high but should ease, and that whether bids actually came down in Q2 or Q3 would depend on the market.

They're starting to come down. GCs are needing to find projects to keep their subcontractors working, and when crews need work, pricing gets sharper.

It's early and it still varies by market, but the direction we called is holding.

We've said for three straight quarters that 5-over-2 doesn't pencil, and for most deals that's still true. The construction cost is too high and the rents don't justify it.

That said, a few are moving. We're projected to start a new podium in Houston in Q4, and we're hearing rumors of others going forward in Kansas City, Indianapolis, and Nashville.

Even so, we're not seeing much that makes sense as a clean 5-over-2 just yet. A handful of developers are finding the exception, but it's still the exception.

No new markets this quarter, but we've seen another surge of work in Active Adult site planning.

It seemed like Active Adult lost its steam a year ago or so, and now, with the economic headwind on market-rate deals, it looks like it's making another big push forward. Some of the strongest equity sources for Active Adult are eager to get deals in the ground, which is usually the clearest signal you get.

There's a second one worth watching. Recent legislation is leaning in favor of Build-for-Rent communities, so it's likely we'll see a push for those developments in the coming months.

Last issue the question was what density we could get on a site with wood frame and surface parking, and it hasn't changed much since. What has changed is that the answer keeps getting clearer.

Within our density study and site planning work, surface-parked deals continue to outpace structured-parking deals. We're seeing even more site plan studies come through the door, and more of them are starting to materialize into real deals, including a few we land planned one to two years ago.

The framework we use to test it is the same one we put together last quarter: construction type, parking strategy, circulation efficiency, site coverage, and AHJ engagement. They all interact, so we test them together rather than one at a time.

We’ve maintained our excellent staff and put time and resources into further development and training, so we're ready for the surge of multifamily work that's coming.

We've also fine-tuned our QA/QC, which means cleaner construction documents and clients who can move through construction quickly without running into surprises in the field.

And we've started taking on some Industrial projects. One of our partners is well-versed in the sector, and it's a deliberate way to diversify what Meeks + Partners can deliver.

That's the quarter. Costs are easing, podium is finding its exceptions, and Active Adult is back.

We'll check these calls again next quarter.

Reply to this email if you want to talk through a site. It comes straight to me.

If this was forwarded to you, you can get the next issue here: Meeks Quarterly » And if you know a developer weighing these same calls, send it their way.

— Trevor