Waco is one of Texas's fastest-growing secondary markets, driven by Baylor University's expanding national profile, the global tourism phenomenon created by Chip and Joanna Gaines' Magnolia brand, and its strategic position on the I-35 corridor between Dallas and Austin. The market of approximately 290,000 has seen commercial real estate fundamentals improve dramatically since 2016 as Magnolia's tourism draw transformed the downtown commercial landscape.
Waco Market Overview: Key Metrics
The Waco commercial real estate market in 2026 reflects a market shaped by Baylor University, Magnolia (Chip and Joanna Gaines), L3Harris Technologies, Hillcrest Baptist Medical Center (Baylor Scott and White), Sodexo, City of Waco, McLennan County government, H-E-B. Here are the key metrics investors and borrowers should know:
- Multifamily Vacancy: 6.5% — near the national average with healthy absorption
- Industrial Vacancy: 5.0% — reflecting strong logistics and distribution demand
- Office Vacancy: 12.0%
- Retail Vacancy: 7.0%
- Rent Growth: 5.0% year-over-year
- Job Growth: 2.8% — outpacing the national average
- Population Growth: 2.0% annually
- Median Asking Rent: $1,200
Multifamily Outlook in Waco
Industrial & Logistics Market
Office & Retail Dynamics
Financing Landscape in Waco
Commercial Lending Solutions arranges commercial real estate financing in Waco from $1 million upward. Magnolia district and Baylor-proximate retail, agency multifamily, and I-35 corridor industrial are the most active financing categories. Waco's transformation story attracts national lender interest unusual for a market of this size.
For borrowers in the Waco area, current commercial mortgage rates range from 6.00% for agency multifamily to higher rates for transitional and value-add projects. Key factors that influence your rate include property type, leverage, sponsor experience, and asset location within the metro.
Top Submarkets to Watch
The Waco metro features several distinct submarkets that present unique investment opportunities:
- Downtown Waco
- Silo District
- South Waco
- East Waco
- Woodway
- Hewitt
- Lorena
- Hillsboro
- Corsicana
- Temple
- Killeen
- Belton
Each of these submarkets has distinct characteristics in terms of tenant demand, development activity, and pricing. The top investment corridors in Waco include Woodway, Hewitt, Lorena, West Waco, Bellmead, Lacy-Lakeview, McGregor, downtown Waco Magnolia district.
Investment Outlook: Waco 2026
Waco's outlook is strongly positive. The Magnolia economic phenomenon continues to attract national retail and hospitality brands to the downtown district. Baylor University's enrollment growth and its expansion of professional schools in law, medicine, and business drives real estate demand. I-35 corridor industrial development is accelerating. CLS expects continued cap rate compression as institutional capital follows Waco's growth trajectory.
CLS CRE in Waco
CLS CRE provides commercial mortgage brokerage services throughout the Waco metropolitan area, with access to 1,000+ lenders including banks, life insurance companies, CMBS conduits, agency lenders, debt funds, and credit unions. Whether you're acquiring, refinancing, or developing commercial property in Waco, our market expertise and lender relationships help you secure the most competitive terms available.
Explore our financing programs for Waco:
- Bridge Loans in Waco
- Permanent Loans in Waco
- Construction Loans in Waco
- Multifamily Financing in Waco
- Industrial Financing in Waco
- Retail Financing in Waco
Trevor Damyan is a commercial mortgage broker at Commercial Lending Solutions with a background in structured finance at CBRE and Marcus and Millichap Capital Corporation. He specializes in bridge loans, construction financing, SBA programs, DSCR loans, and complex capital structures for investors and developers across all 50 states.
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