(972) 737-2503

here’s what you should know:

A healthy rebound is unfolding throughout the DFW office market after the impacts of the pandemic.

  • Over the past year, net annual absorption is 3 million SF as compared to -5.7 million the year previous.

Construction activity has been relatively constrained.

  • During the past year, 3 million SF were delivered, and 7.9 million SF of space is currently under construction, with the Frisco/The Colony and the DFW/Freeport Coppell submarkets leading the charge.
  • The number of starts in 22Q2 have declined to 633,000 SF as compared to 1.5 million SF in 21Q1
  • Over the last decade, 13.2 million SF of medical office space was added as a result of high population growth and increases in demand
  • Harwood is expected to deliver in early 2023 with a 359,000 SF 27 story building uptown that as of mid-2022, is 70% preleased. Haynes and Boone, Dallas’ largest law firm, will be taking 125,000 SF of the space.

Subleasing activity has increased and so has sublet space.

  • Sublet space availability has increased by 4 million SF since 2020, reaching 9 million.
  • The metroplex showed 1.5 million SF of subleasing activity in 2021, with the trend continuing into 2022 and subleases making up 10% of total leasing activity in the first half of the year.
  • There is a decade high of 75.3 million SF of available direct space in existing or under construction buildings.
  • Vacancy rate is currently 17.8%, the highest it has been since 2010, although still lower than found in many larger markets.

Corporate Relocations and Expansions Continue to Drive Office Demand in DFW.

  • 2,700 new leases were signed in the first half of 2022, totaling 10.1 million SF and on track to surpass last year’s total.
  • JCPenny is moving its headquarters to CALWest in Plano, a 318,000-SF
  • The CityLine Development comprised of a 186-acre mixed use development landed a significant new 43,000 SF lease with construction firm McCarthy Companies.
  • California-based healthcare software firm Review Wave is joining Common Desk in McKinney with a 34,900 SF space.

Rents are Showing Signs of Recovery and Sales Have Been Resilient.

  • Over the last 12 months, rent growth has been positive at 2.5%
  • The average rent is currently $29.00/SF
  • Solid economic underpinnings and continued interest from companies in more expensive coastal markets have generated increased interest in the metroplex
  • At $240/SF, the metroplex is still relatively affordable with lower barriers to entry than many major markets
  • Cap rates have remained relatively stable at 6.7%.
  • The market got off to a solid start in 2022 when 50-story landmark Trammell Crow Center sold for an estimated price of over $600 million to a California-based real estate investor that opened a second headquarters in Dallas.

The Economy is in Expansion Mode. 

  • 275,000 jobs were added last year, 155,000 more jobs since February 2020, growing 7.4% and fully recovering from the recession. 
  • As of June 2022, the economy has reached 3.9 million jobs and is reporting an unemployment rate of 3.2%
  • Household incomes continue to rise for north Texans, with about 4% growth annually over recent years and now tracking near $80,000
  • The DFW region is averaging 103,000 new residents every year, becoming more diversified and representative of the broader US economy
  • Companies are relocating, including Caterpillar from Illinois to Irving, engineering giant AECOM from Los Angeles to Dallas, and MD7 LLC consultancy firm from San Diego to Allen, bringing billions in capital investment and creating jobs.


More Posts

No Results Found

The page you requested could not be found. Try refining your search, or use the navigation above to locate the post.


Submit a Comment

Your email address will not be published. Required fields are marked *